Quarterly Market Reports
Article Courtesy of: Inman News
By: Cara Ameer

Educating and empowering clients will lead sellers to being comfortable with making good decisions and hopefully generating some more inventory in this challenging market. Here are a few questions they'll most likely be asking you in 2022 — and how to expertly answer them
 
Over the last two years, the real estate market has had a major shift, and a new normal was created in real estate. That “new normal” meant low inventory, multiple offers, crazy asking prices, pie-in-the-sky offers and sellers calling the shots on their time and terms.
As we transition into 2022, what will sellers want to know when they are considering putting their home on the market? What concerns and questions will they have? Here are seven questions agents should expect when talking to sellers about selling in the 2022 market.

1. We would consider selling, but where do we go?

Hence, the mega-million-dollar question in just about every market these days.  There are plenty of people that, if they knew with certainty where they would move to, they would put their home on the market in a New York minute.

But that’s the challenge today. They aren’t worried about selling and cashing out. With prices climbing and very little choices available in many markets, plus long delays for new construction, these are all hesitation points that are holding sellers back from moving forward.

When a client or prospect reaches out to discuss selling their property — whether it is simply a happy thought at this point or they have a timeframe in mind — it is best to start getting them familiar with what choices may look like for both finding something to buy or rent.

You may have to reach far and wide, and it may require a lot of digging in the dirt, including working your agent network as well as that of your sphere for any options that aren’t officially for sale (but could be under the right circumstances), as well as anything that could be coming up in the future.

Rentals may not just mean diving into existing homes but also understanding apartment complexes and what options may be possible there, whether short term or long term. Having contacts that manage short-term rentals will also prove highly valuable, particularly if they have access to properties that might be exciting to stay in, even for a short period of time.

Many newer apartment complexes are quite luxurious and have a lot of amenities — something like this may assuage a would-be seller as a comfortable temporary solution while they work to find something more permanent to relocate to.

It’s also important to explain various options available as far as negotiating a timeframe whereby the seller can occupy their property past closing with a post-closing, short-term occupancy agreement or lease for a certain amount of time, but also explain how that could impact the buyer audience for their property.

For example, if the price point is likely to attract buyers getting mortgages, post-closing occupancy by a seller longer than 60 days may cause the property to be viewed as investment property and trigger a higher interest rate from the lender.

2. Will I be able to get a price as high as what comparable homes sold for in 2021?

It depends on a lot of factors, such as when you will be coming on the market and what you might be competing with. While low inventory is projected to remain, today’s buyers still want turn-key, and given the prices they are paying and likely stretching themselves, they don’t have the financial bandwidth or the time to take on major renovation projects.

So, if the property is not updated, has deferred maintenance and in need a lot of prep for sale, they may not get as much as they could have six or 12 months ago, depending on where the property is located as people were clamoring to just get a house.

Some buyers have put the brakes on, and after looking at crappy home after crappy home, they might not be inclined to pull the trigger at just anything.

The crazy overpricing that has taken place in the last two years might be knocked back a bit, depending on the property, where it is located and who the buyer audience is.

3. Do I have to do any prep for sale since inventory is so low?

This is a perfect question to follow the pricing discussion. Today’s buyers want turnkey, and since many buyers may be making decisions from afar — because, say, they aren’t able to come in town fast enough before a home may sell — they are basing their decisions on how a property looks online or perhaps a virtual showing by their agent.

That being said, this is not the time to skimp on taking the time to properly prepare a home for sale. The basic rules still apply from decluttering, cleaning, pressure washing, window cleaning, painting, freshening up landscaping and taking care of any needed repairs or deferred maintenance from caulking, torn screens, wood rot, corroded hardware, etc.

Some upgrades or improvements may be necessary, such as new appliances, updating countertops to today’s design trends and expectations along with cabinet hardware. Consider replacing old sinks, plumbing and lighting fixtures as well.
Time spent preparing your home for sale will translate into a better appearance online as well as in person — and help to justify your asking price.

4. Even if I do prepare my home for sale, can I just sell ‘as is’?

This question really depends on what is being done in your market and what expectation (or not) contract documents create. In some markets, the property is presumed to be sold “as is” except for any health and safety issues.

In other markets, the way the inspection and repair paragraphs read, it is almost inviting the buyer to create a repair list. Of course, a seller can always negotiate selling “as is,” but a variety of factors go into this.

If the property has structural components that are near end of life — roof, air conditioning and heating systems, water heater, plumbing, etc., it may be difficult to sell “as is” if the buyer will have difficulty obtaining property insurance or if it is extremely costly without replacing these items before closing, which in turn could cause a snag if buyer is obtaining financing.

Trying to pass off a home with an old roof or heating and air conditioning system while asking beyond top dollar could be difficult. These kinds of items are often cause for concern for many buyers who are already going well over asking price to buy a home and don’t want to have to spend money replacing a lot of big ticket items.

A seller may have to consider replacing some of these things to make the home more sellable and the transaction go that much smoother. Alternatively, obtaining estimates and being prepared to take care of this prior to closing once a buyer is found can also be an option, but since contractors and timelines can be challenging, this can cause unnecessary delays and frustration by all involved, so it is often better to deal with this before putting the home on the market.

5. What about selling ‘off market’?

With so many potential sellers hesitant to formally list their property due to the uncertainty of where to go, along with the pressure of having to uproot and potentially commit to another living arrangement they may be less than thrilled about, coupled with the unknown of how long it might take to find something they would want to buy, sellers may ask if there is a way to sell without having to formally list and go through the pomp and circumstance of photos, videos, broker opens, public open houses, etc.

In addition, as more information is forthcoming regarding the COVID omicron variant and rising cases in the U.S., sellers may have some concerns and want to look for a less intrusive way of selling their home.

Off-market sales have been the topic of a tremendous amount of controversy, and private networks promoting them have been in violation of the National Association of Realtors’ Clear Cooperation policy.

While agents haven’t really had to get into the weeds with a lot of the rules and regulations affecting our business in the past when meeting with a seller, the plethora of changes over the last two years is causing the tide to change.

Most sellers have no idea about the rules of the road when it comes to wanting to sell “off market” and the potential ramifications that could affect the agent and broker. They may not understand why you can’t post a few photos and spread the word on social media or have an invitation-only open house if you aren’t formally listed.

So, it is more important than ever to explain to a seller about what “off market” means and how it could impact their ability to sell. While “Coming Soon” status is not a new thing, it may be to consumer that haven’t been in the real estate market in awhile, thus it is also important to explain the difference between what “Coming Soon” means and what activities can be done in that status vs. “Off Market.”

While many MLSs throughout the country have some version of a “Seller Exclusion from MLS” form or allow a listing to be registered with the MLS but not formally listed on the market (which means no marketing can be done), the seller needs to understand what an agent can and cannot do if they choose to not list in MLS and how that may impact them and their bottom line.

Often wrapped in this discussion is, “I don’t want to formally list, so can’t you just find me a buyer who will pay my price and close when I want?” It will be important to discuss all of the above as it is not as simple as just that, hence less people with the ability to know about the property which may not result in finding the buyer who is the best puzzle piece to match with the seller in terms of price, terms, expectations, flexibility and so on.

6. What about iBuyers?

Despite the demise of Zillow Offers, there are still a myriad of companies out there promoting that they will buy a seller’s home without them having to formally go on the market.

Agents need to take the time to educate themselves about these various companies to be able to explain the potential hitches and “gotchas” involved that a seller won’t know about until they get to the closing table.

The actual costs may be quite eye-opening for a seller and end up costing more, plus leaving money on the table due to lack of leverage. Many large real estate brokerages have programs to generate an offer for a seller before coming on the market that can be used as leverage, if nothing else.

It may be helpful to walk through that exercise with the seller so they can see what they might be preliminarily giving up if they went that route.

7. What can you do on the commission?  

Questions about commission have rarely escaped any listing appointment. Several powerful pieces have recently been written in Inman about this very topic. The empowered and informed consumer has likely consulted their armchair expert “Google,” who has given them information that can be taken out of context.

That being said, sellers may be asking if their house is going to sell so fast, why do they need to pay x amount. It is crucial that agents refine their response to account for this question.

Three or four years ago, homes may have taken three to six months to sell or even longer in many markets, and it was easy to justify all the visible time you were going to have to put into the listing from being present at showings, multiple open houses, broker opens, fancy luncheons or broker events, following up on all the feedback, etc.

With some of the luxury price points, signing a listing agreement was almost like getting married to a property as you didn’t know how many months or years it might take to get it sold.

Furthermore, it is also important for sellers to understand the new NAR rules regarding display of buyer agent commissions on websites. While most sellers don’t care what the buyer or seller side get commission-wise (as they are just focused on the total amount being paid to the agent(s) involved in the transaction), it is important for sellers to understand that this information is no longer confined to the MLS system.

When they want to do the Texas two-step when it comes to trying to reduce the listing fee, they also need to know how that may impact the selling-side commission offering, along with how it stacks up relative to the competition.

While agents can’t intentionally omit showing a property due to the commission being offered if a client wants to see it, it is harder to police internal choices an agent makes when putting a property tour together of what to show a client (if they aren’t asking about a certain home) while omitting others.

Thus the endless circular debate ensues that agents don’t work for free and can choose where they want to spend their time and effort to get paid and for how much.

Selling a home is like a game of chess, and trying to play the game with minimal help or insight is like working against yourself. Demonstrate to a seller that besides marketing and all the hype you can create for a new listing, intentional strategy, attention to detail and knowing the contract and all addendums inside and out is crucial in anticipating and mitigating things from going wrong by being proactive in the first place.

Ensuring all negotiated terms are clear, providing a timeline of events, actively monitoring each milestone and being able to explain how the contract addresses the umpteen scenarios that can arise along with how you would handle them can make you a shining star to the seller. When you show them your value, they will feel bad for asking you to discount in the first place.

Shower them with so much knowledge and professionalism they will be absolutely blown away. Walk in the door with all the potential contract forms well organized in a binder or folder, indexed and tabbed so they understand what they could be dealing with.

Highlight provisions that they need to pay extra close attention to and how you will be hovering over all to ensure there are no hiccups. In California for example, the Residential Purchase Agreement (RPA) has undergone an overhaul and a new purchase agreement form and approximately 90 addendums have been updated.

The first page of the RPA is a very detailed chart of all contract timelines for every potential contingency and milestone.  That chart alone when shown to a seller (or buyer for that matter) can look quite daunting when they don’t really know what they should be looking for, but you do.

While some questions stay the same from year to year, others change based on market conditions and the tools and technology that the consumer is aware of, such as iBuying. When the market was at its low point during the real estate market crash and shortly thereafter, sellers used to want to know how much money they would have to bring to closing before the listed, or if they owed much more than they could sell for, what a short sale was and all the ramifications involved.

The agents in the business during the heyday of that distressed market got very good at doing cost sheets for a seller before ever setting foot in the door along with having their title company or short sale attorney on speed dial to consult with the seller on procedure and process.

While those days are gladly in the rearview mirror, hopefully to never return again, we must continue to evolve in strengthening our ability to answer our sellers questions with confidence and substance versus surface-level answers and saying “I’ll look into that,” but never following through.

Educating and empowering our clients will lead sellers to being comfortable with making good decisions and hopefully generating some more inventory in this challenging market.

Cara Ameer is a broker associate and global luxury agent with Coldwell Banker Vanguard Realty in Ponte Vedra Beach, Florida. You can follow her on Facebook or Twitter.
7 Questions Sellers Will Ask On Listing Appointments in 2022
GBREB NEWS

New Report: Rent Control Would Cut Housing Supply, Lower Values & Tax Revenue in Boston, Across Massachusetts

A new analysis shows rent control proposals would drastically reduce the supply of apartments, property values and tax revenue in Boston and throughout Massachusetts if the Legislature rescinds the voter-approved ban on the policy.

The new NAA reports analyze the impact if a 3% annual cap on apartment rents is implemented in Boston or across the state, as proposed in current legislation. Among the key findings:
● New apartment supply will drop by more than 700 units per year;
●  Apartment property values will drop by more than $260 million; and
●  Property tax revenue to the City of Boston will drop by more than $2 million annually.

Across Massachusetts, the negative outcomes increase exponentially:
● Impacts 40%, or more than 18,000 units of foregone new housing stock and existing units potentially lost due to infeasible repairs and upgrades of existing stock;
● Apartment property values drop by more than $820 million; and
Property tax revenue to cities and towns will drop by more than $7 million annually.

The reports further notes that, in Boston, apartments and their residents contribute more than $54 billion to the regional economy annually, and support more than 228,000 jobs. Throughout the state, apartments and their residents contribute more than $60 billion to the Massachusetts economy each year, and support more than 268,000 jobs. But if a 3% annual cap on apartment rents is implemented, both the economic strength and massive workforce created by the apartment industry would come under serious threat.

IMPACTS OF RENT CONTROL: MASSACHUSETTS
IMPACTS OF RENT CONTROL: BOSTON

New Rent Control Report
Article Courtesy of: Inman News
By: Christy Murdock
 
Any top producer will tell you that to build a solid foundation for your business, you must have a plan (and one that’s actually written down tends to stick and come to fruition).

Performance coach and counselor Dr. Darlene Treese’s five paradigm-shifting steps make a solid framework for developing a business plan, and she would know, having worked on leadership, performance and mental health with students, families and even the Department of Defense. 

We’ve paired some of Dr. Treese’s best advice with that of industry professionals on how agents should approach business planning for 2022. 

Shift your mindset

Many agents view themselves as service providers and see their work as transactional in nature. One of the most important things you can do to develop your business plan is to begin thinking of yourself as a business rather than as a salesperson. 

According to Mark Choey, HighNote founder and CEO, many agents fall into the trap of being super-busy but having very few long-term results that come from all of that busy-ness.

“As an agent, you are not only the CEO, but the CMO, CFO, CTO, Chief Economist, bookkeeper, handyman, janitor, and, of course, the VP of sales!” Choey said. Understanding all of the moving parts of a business can make a huge difference in how effective you are in building your business. 

“Don’t let others define your success. Know yourself.” – Dr. Treese

Begin by determining what type of business entity would work well for you, whether LLC, C-Corp, or S-Corp. Talk to your accountant or financial adviser and your attorney to better understand the advantages and disadvantages of each and to put a plan together.  

Once you start thinking of yourself as a business owner rather than an individual agent, you’ll begin to develop a perspective that helps you think big picture and long term, rather than focusing on immediate results.

Become resilient 

One of the biggest obstacles agents face is, ironically, the one of too much success. This often causes them to get bogged down in the day-to-day of client services, putting out fires and doing little to plan for the future. It keeps them from taking advantage of the potential their business offers. 

According to DOORA Properties broker-owner Troy Palmquist, planning for the year in advance, setting goals, and letting those goals dictate your actions is essential for keeping yourself focused and bringing more consistency to your business.

“So many agents fall on their face when they get busy and then stop doing the things that got them busy in the first place,” Palmquist said. One of the things that he finds particularly effective — sphere of influence marketing — is the first thing to go by the wayside when agents get a few clients in place.

Palmquist stresses the importance of setting a goal and creating a path, then sticking to the path as you have laid it out. Manage the growth as it comes rather than ramping back on your communication and marketing — the things that are working and creating the growth.

“View failure as a learning opportunity. View obstacles as challenges.” – Dr. Treese

According to York Baur, CEO of MoxiWorks, “One of the key resources that agents often overlook is their sphere of influence — their ‘database’ — which is where the majority of their business comes from.”  

Take advantage of the potential of your CRM and transaction management platform to simplify and streamline your operation. Making sure that you have the information you need in a system where you can use it to market is the key to success, Baur said.

Make investments

Investing in yourself and your business often means taking a leap of faith and setting yourself up for success. Part of that process is remembering what activities bring in money — your networking, your outreach, your expertise — and focusing your efforts on those activities. 

Many agents continue to think of themselves as a one-person show with total responsibility for every aspect of their business. According to Choey, the first thing every agent needs to do is hire an assistant if they don’t have one already. 

“If you feel like you can’t afford one, split him or her with another agent … or two! You absolutely need an assistant to handle all the details, admin, payments, scheduling, so you can do the things only you are licensed to do, sell real estate!”

“Invest in yourself. Act like you’ve already won.” – Dr. Treese

Next, Choey recommends hiring a business coach who will hold you accountable to “the numbers you need to hit each and every week and each and every month.” 

Those are not necessarily sales numbers, but numbers going out: 
• money spent on leads
• the number of calls to your sphere
• social media engagement
• time spent at networking events
• farming
• email newsletters
• the number of appointments taken
• the number of properties shown or previewed
• the number of clients you are working with

According to Baur, there are no expenses, only investments. “Every dollar, minute, or favor from someone else is an investment that needs to have a return in mind.” This means that everything you do should lead to a potential result or accomplishment. 

Maintaining consistent outward focus will result in consistent dividends. Freeing up your time and giving yourself the opportunity to perform pays for the people who help to make it possible.

Avoid negativity

For many of us, building a business means overcoming a lifetime of messaging about who we are or what we are capable of. Some of us suffer from imposter syndrome — the sense that we are only pretending to be as competent or capable as we appear to be — while others are fighting a childhood context of poverty, educational struggles or other challenges to our self-image. 

If there are people in your life who are constantly telling you what you can’t do or making you feel bad about your efforts and accomplishments, it’s time to avoid them, Dr. Treese says. “Surround yourself with positive people and with those who share your vision and can help it grow. Be with those you want to be like.” 

“Avoid toxic people. Surround yourself with positive people.” – Dr. Treese

Many agents ignore a valuable resource that is constantly available to them at little or no cost — brokerage meetings and masterminds, local associations with training and networking events, and state or national conferences and associational events. Connecting with the best and brightest at these events can be a powerful motivator and a way to learn from the experiences of successful colleagues.
 
In addition, if the pandemic has taught us anything, there are a plethora of online resources — from blogs to YouTube channels to webinars and online courses. You can learn anything from social media marketing to graphic design to bookkeeping to the ins and outs of specific real estate niches. 

When you come from a place of possibility and potential and surround yourself with like-minded individuals, fellow entrepreneurs, and positive thinkers, you set yourself up for success.

Take action

Finally, from real estate investor and radio host Abhi Golhar, is the fitting advice to “Stop planning. Start doing.” According to Golhar, too many people set out to spend time convincing themselves that they’ll be successful if only they develop a perfect plan at the outset. “It’s like a rocking chair,” Golhar said. “It gives you something to do but ultimately gets you nowhere.” 

According to Golhar, many agents spend too much time working on step-by-step plans rather than putting their ideas into operation. He offers the example of creating a marketing campaign: You can speculate about which strategy will be most effective, but you’ll get further if you design the graphics, write the copy, and get your ad live. That way, you can compare different iterations and hone in on the one that works best.

“Do what you are most passionate about.” – Dr. Treese

Often, planning is just another word for procrastination, and it’s never going to be foolproof. Make sure the planning process you do for 2022 is meaningful without being an excuse or a means of delaying necessary forward momentum.

Christy Murdock is a Realtor, freelance writer, coach and consultant and the owner of Writing Real Estate. She is also the creator of the online course Crafting the Property Description: The Step-by-Step Formula for Reluctant Real Estate Writers.
5 Business Planning Must-Do’s for 2022
As you may know, the free forms benefit provided to you as part of your membership dues through partnerships between the National and Massachusetts Associations of REALTORS® and zipLogix is changing. At the end of this year, NAR will discontinue the zipForms™ member benefit, and MAR has chosen a new, alternative provider – Remine Docs + – to offer free access to its MassForms Library. At GBAR, however, we’ve opted to keep this important member benefit on the zipForms™ Plus platform.
 
Specifically, the GBAR Board of Directors has voted to continue delivery of the GBREB Standard Forms Library on the zipForms™ Plus platform for at least two more years (2022-2023), and will partner with LoneWolf (which now owns and manages the zipLogix brand) to provide and service this product. What does this mean for you? As a GBAR member, you will have continuous, uninterrupted access to your current zipLogix account, transactions history, and forms files. There will be no new log-in account or credentials to set-up, no need to back-up or transfer files, and no additional cost to you. You will have access to both the desktop and mobile versions of zipForms™ Plus for GBREB Forms and MassForms™, and your membership dues remain the same for 2022.
 
Notably, for those who use the Digital Ink e-signature tool, broker transaction management tool - zipTMS, or other items available in the suite of products offered to agents and brokers, you may purchase them separately through LoneWolf. Meanwhile, for those who want choice and may wish to explore and use the Remine Docs + product, you will be able to find the Greater Boston Real Estate Board’s Forms there as well.
 
To learn more, please watch this GBAR Legal Live session includes a discussion on access to the GBREB Forms Library  on various forms platforms as well as language and content revisions on existing forms.
GBAR Retains zipForms Plus Member Benefit
Article Courtesy of: Inman News
By: Tom Toole

Just by getting on the phone, you can generate new leads and build your own listing inventory. The business is that simple. The people who have the most conversations and go on the most appointments sell the most houses

The real estate inventory shortage continues, with countless agents competing for too few listings. So, how will you take charge of your own inventory?

Instead of waiting for sellers to come to you, leverage the listings you already have and build your own inventory. Let potential sellers know about the work you’re doing, and establish yourself as the real estate expert in their neighborhood.

1. Use circle dialing

Reach out to the homeowners in an area where you’re already working and deliver value. Let them know that you’ve listed a home, you’re hosting an open house, you’ve gone under contract or you’ve closed a home, or share general neighborhood sales activity.

If, for example, you sold a home after getting multiple offers, you can use that information to deliver value to the other owners in the neighborhood using a script similar to this one.

Congratulations on the fact that your home’s value just went up. This is Tom Toole with RE/MAX Main Line and the Tom Toole Sales Group, and we just sold the Wolf family’s three-bedroom, two-bath property down the street after receiving four offers on the house. How does your home compare to their house?

Make sure that you use the name of the homeowner in your communication because these owners will likely know your customers, and using a name personalizes your message.

At this point, the person on the phone may tell you that their house is larger or smaller, and then you can continue the conversation.

The buyers who lost out on that home still want to buy in this neighborhood, so I wondered whether you have any interest in selling your home.

Because you’re the agent with the most recent sale in the neighborhood, you can establish yourself as the expert in the area. And now you can work to help the buyers who lost out on the deal, and you can help the existing homeowners begin a conversation about selling their own homes.

From here, you can begin the normal process of qualifying the client and working to build rapport.

2. Leverage your phone’s contact list

Instead of beginning with the first name on the list, scroll all the way down to the bottom because those are often the people we never call. Craft a relevant message that you can share with the people on your list. Here’s an example: 

Hey Nick, it’s Tom Toole. I realize things have been pretty crazy this year, and I wanted to see how you and your family are doing.
Add questions like, “how has the work environment been?” If they have kids, ask about school. Have a human conversation, and do not talk about real estate. (Think FORD script: family, occupation, recreation, dreams.)


Remember, these people know you’re a Realtor, so if they have questions about the market or if they have a need, they will ask you. This is the opportunity to provide value by being the knowledge broker and knowing the market.

They may ask you about the market or something else related to real estate, and you’ll have a great opportunity to provide value in the form of information.

These people in your phone book will include family, friends, past clients and other people in your sphere of influence who already know, like and trust you. The list might also include mortgage brokers, estate attorneys, or accountants, and other people you have helped your clients or with whom you have done business.

Bonus tip: Start at Z in your phone book, and work your way up because everyone always starts at A in the contact list.

3. Take advantage of your CRM

Identify all the long-term leads you haven’t talked to in a while, qualified leads that you’ve previously engaged and past clients who have been in their homes for a while. Send them this simple text:

 Hey Nick. The holiday season is already here and the spring market is just around the corner.  Question: have you had any thoughts about selling during the coming year?

The fact that this has been one of the most seller-friendly markets in history gives you reasons to engage those people who are thinking about selling.

As an agent, it is your job to be the knowledge broker and pass on what is happening in the market. You cannot leave it up to the consumer to know, and when you internalize that mission and come from a place of help, it shines through in your dialogues. It is an easy and effective way to get buyers and sellers off the fence. 
 
By simply getting on the phone, you can generate new leads and build your own listing inventory. The people who have the most conversations and go on the most appointments sell the most houses. The business is that simple.

Do the work that other agents aren’t willing to do, and you can drive sales now and well into the future, regardless of inventory shortages.

Tom Toole is the founder and team leader at Tom Toole Sales Group. 
 
3 Proven Tactics For Overcoming the Inventory Shortage

 

Article Courtesy of: Inman News
By: Bernice Ross
 
From need-to-know statistics to predictions about the future, Bernice Ross recounts the most important takeaways from NAR's Realtors Conference & Expo. Here's what you need to know
 
REALTORS® from across the world convened last week at the National Association of Realtors’ (NAR) Conference & Expo in San Diego — vaccinated, masked up and ready to face the challenges ahead in 2022.
There was plenty of good news on the economic and legislative fronts, the new 2021 NAR Profile of Home Buyers and Sellers revealed some startling findings, and CoStar provided the fireworks as it proclaimed its core value proposition loud and clear: “Your listing, your lead.”

Here’s the lowdown on what happened and you need to know.

NAR successfully defends the 1031 Exchange

Realtors were ecstatic to learn NAR had defeated the Biden’s administration attempt to eliminate 1031 Tax Deferred Exchange.
Kudos to NAR’s leadership and all the Realtors who fought this at the grassroots level. Not only did they stop it, NAR’s chief economist, Dr. Laurence Yun, went on to say, “There is no proposed bill in D.C. to remove it.” 

2021 is a banner year for the industry despite the pandemic

According to Dr. Yun, “Once the numbers are counted up at the end of December, we will find out home sales this year would have been the best in 15 years since 2006.” 
These numbers are a tribute to the resilience and perseverance of the Realtor community as it came roaring back from what is arguably the greatest disruptive event of our lifetimes. 

Supply chain issues expected to improve in 2022

When Americans received their stimulus checks, they went on a buying spree. The problem was that factories were still closed due to the pandemic. The result was there was nothing in the pipeline.
Dr. Yun expects supply chain issues to improve in 2022, although the worker shortage will continue to be an ongoing challenge for the entire economy. 

Need-to-know stats from the 2021 NAR Profile of Home Buyers and Sellers

NAR just released its 2021 Profile of Home Buyers and Sellers. Here are some of its most important findings.   

The 2 most important statistics for your business
Do you know what percentage of buyers and sellers only interview one agent before they decide to list or purchase? 

In 2020, 67 percent of the buyers and 75 percent of the sellers only interviewed one agent. In the new 2021 profile, 73 percent of the buyers and a whopping 82 percent of the sellers only interviewed one agent!

These numbers are incredibly important given that the first agent who meets with the buyer or seller in person is the agent who gets the business. 

The No. 1 takeaway here is that as soon as you receive a buyer or seller lead, your highest priority must be to set a face-to-face appointment, even if they’re not planning on transacting right away.

With buyers, the goal of the meeting is to build your relationship by helping them by having them check their credit report for errors, seeing if they will qualify for down payment assistance, and beginning the mortgage pre-approval process. Of course, you will also be able to determine whether the buyer is also a potential seller. 

Here’s why this is incredibly important. According to the 2021 NAR Home Buyer and Seller Generational Trends, 51 percent of all buyers owned their previous residence. If you’re working with baby boomers, those numbers range from 65 to 85 percent

In other words, if you didn’t follow up on 50 buyer leads this year, you missed the opportunity to meet with at least 25 potential sellers. 

In terms of setting a meeting with the seller, explain that the purpose of the meeting is to provide them with an updated valuation of their property plus some additional information and reports. Two excellent sources of these reports are NARRPR.com and HomeDisclosure.com. 

If the seller is purchasing in the area, update them on market changes and any changes in interest rates, and assist them in beginning the preapproval process.  

Other important findings  

A major drop in how long sellers stay in their homes 
For the last decade, the median length of time sellers stayed in their homes has hovered between nine to 10 years. This year, that number dropped to eight years. This number hasn’t been this low since 2010.

A new high for median prices: 100 percent of asking price
2021 set another record. For the first time since NAR started tracking these numbers in 2002, the average sales price in the U.S. was 100 percent of the listing price.

Average market time plunges
According to the 2021 profile, there has also been a major decrease in market time: 
“For all sellers, time on market decreased this year to a median of just one week, from three weeks in 2020. Time on the market and the ratio of sales price to listing price have a strong relationship; generally, the longer a home is on the market the greater the discount from the listing price upon sale … Sixty-two percent of sellers reported their home was on the market for two weeks or less.”

Referrals still reign supreme 
Seventy-three percent of the sellers either knew or worked with the agent based on a referral. 

FSBOs: a dying breed
It is becoming increasingly difficult for FSBOs to sell without the assistance of an agent. Only 7 percent of all sellers were FSBOs, however, only 3 percent didn’t know the buyer vs. 4 percent who already knew the buyer.
The 4 percent who knew the buyer includes intra-family transfers due to death, divorce, conveying part of the ownership interest to children, etc. 

Stop worrying about iBuyers
According to the 2021 Profile, “While the survey asked about iBuyers as a selling method, less than one percent of sellers used these online only programs.”

Fireworks from CoStar

Make no mistake about it — CoStar intends to become a dominant player in the residential real estate tech space. Its branding was everywhere at the conference.
The company had a huge booth where it hosted a Tesla and vacation giveaway. Its banners were everywhere, and plus, it posted its ads on vacant buildings in the Gas Lamp Quarter as well as on the convention buses.
 
As you prepare for 2022, you must make setting face-to-face appointments your top priority, whether it’s a buyer or seller lead, past client or someone in your referral database. Strive to be top-of-mind. Remember, 73 percent of the buyers and 82 percent of the sellers hire the first agent they see face to face when they’re ready to transact. Make sure that agent is you!

Bernice Ross, president and CEO of BrokerageUP and RealEstateCoach.com, is a national speaker, author and trainer with over 1,000 published articles. Learn about her broker/manager training programs designed for women, by women, at BrokerageUp.com and her new agent sales training at RealEstateCoach.com/newagent.

11+ Takeaways From NAR’s Annual Conference

Article Courtesy of: Inman News
By: Jimmy Burgess
 
If you control the listings, you control the market. If the majority of your business is coming from buyers, you are a real estate salesperson. But, if the majority of your business is coming from listings, you are running a real estate business. Huge difference! 

After 27 years in real estate, I can confidently say that generating more listings comes down to these seven steps. Follow these steps, and you’ll never be listing-poor. 

1. Build a real estate database filled with homeowners

Whatever we focus on expands. Are you focused on growing your database with homeowners? If so, then you now have the foundation for generating more listings.

You should fill your database with friends and family members who own homes in the areas you service. You should include:
Your past buyers.
Owners you’ve met at open houses.
Past expired listing homeowners.
Homeowners in your farm area that you have communicated with.

The way I think about a homeowner database is very systematic. Although we have not been in a typical market environment for more than 18 months, the National Association of Realtors says 10 years is the average length of time a homeowner stays in a house in a normal market. 

On average, 10 percent of your homeowner database will sell each year. No one gets 100 percent of the listings from the potential listings in their database, but following the steps in this article should allow you to convert 50 percent of the homeowners in your database into listings when they decide to sell.

Your database should provide an average of five listings per 100 homeowners per year using this formula. If your goal is to list 20 homes this year, your goal should be to build a database of 400 homeowners.

The more homeowners you add to your real estate database, the better. This group of homeowners provides the opportunity to communicate and add value to them consistently. Communicate consistently to generate new and future listings.

2. Automate the process of sending them comparable home sales activity

We live in the information age. The more pertinent information you provide homeowners, the more top-of-mind you will be when their time to sell arrives.

Because the market is constantly changing, providing real-time information about homes, like the homeowners’, that come on the market and sell is an ideal way to provide them with relevant details about their home’s value.

Your MLS provider and most websites provide automated systems that will email someone properties meeting the criteria you set. These automated property details are a systematic way to add value to the homeowners and keep your face and name in front of them. Every homeowner in your database should have this consistent communication piece in place.

3. Email the homeowners in your database a monthly newsletter

Stay top-of-mind by consistently sending a monthly real estate newsletter to your database. Ask yourself what information the recipient of your newsletter would find educational or entertaining.

It should be a mix of real estate information and community highlights. Identify the areas you want in each month’s edition, and build an email template that is easily utilized each month. The ideal email newsletter for me includes three parts.

The top of the email includes a video of me reviewing the market developments from the previous month. This allows me to speak directly to everyone in my database. It shows my understanding of the market and gives me the ability to connect with the readers more deeply through the video.

In the second portion of the email, I highlight an upcoming local event or a “my favorites” list. Highlighting the local event usually involves a short paragraph introducing the upcoming event linked to the event’s website. The “my favorites” list is very popular with the people in my database. 

A few examples of these lists include:

My 5 favorite date-night restaurants in (your city)
My 3 favorite coffee shops in (your city)
My 6 favorite lunch spots (your city)
My 7 favorite things to do on a rainy day in (your city)
My 4 favorite places for meeting friends in (your city)

The third portion of the email allows me to highlight properties and any new listings taken that month. This allows me to expose the new listings to the buyers in my database and show the homeowners in my database that other sellers are choosing me to list their homes for sale. 

Monthly email newsletters are a great way to add value to your database consistently.

4. Leverage the tool Homebot

One of the best ways to provide valuable insight to homeowners is by giving them a detailed financial breakdown of their home as an asset. Homebot uses advanced analytics to provide a monthly breakdown of the home’s valuation, the amount of equity the homeowner has, options on refinancing and many other insightful details. 

This is the most complete asset evaluation tool I have ever seen for homeowners and a key tool for adding value to homeowners.

This monthly report is uniquely insightful for the homeowner, and it comes branded from you. Homebot is another way to add professional and consistent value to the homeowners in your database.

5. Send an unsolicited CMA every 6 months

I mentioned Homebot above, but providing a personalized CMA every six months personalizes your service to the homeowner and makes a tremendous difference.

The most personal way to really connect with the seller is to utilize a tool like BombBomb or Zoom to record your screen, with your face visible in a smaller box on the screen, and go through the numbers on video with the homeowner — the most effective way I know to generate listings in today’s market environment.

I sent one unsolicited video CMA each day I worked in the fourth quarter of 2018. I did 72 of these during the quarter. Within six months, I generated more than $11M in listings directly from these CMAs I emailed to past buyers, homeowners who had indicated they might sell in the next few years, or homeowners in the neighborhoods I farmed.

Sending unsolicited CMAs is a way to exceed the homeowner’s expectations and generate more listings.

6. Make personalized phone calls every 3-6 months

People do business with people. Email or mail will never replace personal conversations. Depending on how close they are to selling, build relationships that will lead to listings by calling the homeowner every three to six months.

Make check-in calls to generate conversations and build relationships. Start by asking about family, but always ask about their home at some point during the call.

The scripts I used when asking about their home were fairly straightforward. 

Here are a few examples:
“It has been a few months since I checked-in. Are you all still loving your house?” 
“You mentioned six months ago that you all might be considering a move in a couple years. I just wanted to check-in to see if anything has changed.”
“With everything we’ve been through over the past 18 months, a lot of people are reevaluating what they want in a home. Have you all considered repositioning to a home that might better fit your family?”

Nothing ever happens until there is a conversation. Phone calls are a crucial part of the process for generating more listings.

7. Utilize an Adwerx sphere of influence campaign 

The best way to stay top-of-mind for the homeowners in your database is to be everywhere they look. Adwerx provides that opportunity with their sphere of influence campaign. 

Here’s how it works: 
Go to the Adwerx website and begin a sphere of influence campaign.
Configure your ad with the template they provide, including your name, photo, branding, tagline and phone number. 
Upload the names and email addresses of the homeowners in your database.

Adwerx will then retarget the homeowners and follow them wherever they go online, from CNN to Fox News. Whether they visit sites like ESPN or The Wall Street Journal, Adwerx will place your ad on almost any site they visit.

The retargeting campaign is not that expensive compared to the potential return through just one listing a year.

By executing these seven steps, you’ll be top-of-mind for your targeted homeowners, and you will generate more listings.

Jimmy Burgess is the Chief Growth Officer for Berkshire Hathaway HomeServices Beach Properties of Florida in Northwest Florida.

7 Simple Steps for Getting More Listings in 2022
Article Courtesy of: Inman News
By: Bernice Ross

For almost two decades, real estate professionals have been told they will be disintermediated by technology innovation.

Zillow’s decision to stop its iBuying operations is more than just a response to the extreme volatility of the Zestimate and their inability to accurately forecast prices. It’s a recognition that real estate investing, real estate brokerage, and mortgage are fraught with problems that technology companies seldom encounter.

When Zillow first launched in 2006, I wrote several columns citing the inaccuracy of the Zestimate. As a result, Zillow founder Rich Barton invited me to join him for lunch at the 2007 Real Estate Connect to discuss Zillow’s business model in more depth. 

Zillow stood by that promise until  they launched their iBuyer program, Zillow Offers, which they first piloted in 2017 as Zillow Instant Offers. At that point they were no longer advertisers. They were now competing directly with agents to obtain the listing.

In January 2021, Zillow launched its brokerage operation to streamline their iBuying process. They hired salaried agents to work with sellers who were seeking a cash offer from Zillow Offers. Zillow Home was the broker of record.

According to the Real Deal, Zillow made this decision to grow their revenue. When they initially launched the iBuying business in 2017, no one anticipated the pandemic, the labor shortages, and the severe problems in the supply chain that impacted Zillow’s ability to rapidly purchase, update and the sell their iBuyer inventory.

The result had undermined the accuracy of their Zestimates. On a recent earnings call with investors, Barton stated, “Our observed error rate has been far more volatile than we thought possible.”

He later added that, “Fundamentally we have been unable to predict future pricing of homes to a level of accuracy that makes this a safe business to be in.”

Zestimates: A thorn in the side of Realtors since 2006

Since their launch in 2006, Zillow’s Zestimates have been a thorn in the side of agents and for good reason. One of the most common objections agents still face today is, “But Zillow says my house is worth more!”

Unfortunately, very few agents know how to successfully defend against the Zestimate. One clever agent I interviewed back in 2007 overcame the Zillow objection by saying, “I don’t give estimates — I give exactimates.”

Today the best approach is to quote the values generated by other AVMs (automated valuation models) including HomeSnap, realtor.com and The Chase Home Value Estimator Evaluator. You could also include offers from iBuyers such as Opendoor.

When you present sellers with several different AVM values, they are usually confused as to which value is correct. At that point, take out your CMA and explain how you arrived at your price based upon your square footage CMA and local market knowledge.

Cheers from the Inman community

After struggling with the “Zillow objection” for 15 years, the Inman community welcomed Zillow’s admission that their Zestimates were no longer accurate due to extreme market volatility. Michael Scoffner summed up the mood like this:

“What? You mean you can’t rely on a Zestimate?……shocker! (yawn). You gotta admit that the irony in this failure is epic!”

What’s unclear at this point, however, is did Barton only refer to predicting “future value,” not the present value? The problem is with properties sometimes selling for 10 to 30 percent over asking price, predicting the price where they will sell now has become problematical for almost everyone.

What Zillow didn’t say

Over and beyond market volatility and supply chain issues, Zillow’s foray into iBuying and becoming a brokerage has resulted in headaches that may have played an additional role in their decision to abandon their iBuyer program.

One of the most notable issues may be antitrust lawsuit filed by REX Real Estate against NAR and Zillow that resulted in the DOJ intervening.

On September 2, 2021, U.S. District Court Judge Thomas S. Zilly ruled in REX’s favor, saying the brokerage has provided sufficient evidence to back up their antitrust allegations, which hinge on Zillow’s execution of NAR’s “No-Commingling Rule” to separate non-multiple listing service listings from MLS listings on its website.

CoStar throws down the gauntlet

At Inman Connect Las Vegas, Andy Florance, founder and CEO of CoStar Group, declared war on Zillow’s business model. CoStar is the global leader in commercial real estate information, analytics and news. They also own Apartments.com, and they are now making their move into residential real estate.

In a thinly veiled reference to Zillow, (calling them “Zilter”), Florance drew a parallel of what it would be like if “Zilter” did to your “For Sale” sign what they do digitally to your listing online. He explained it like this:

So, we just put our sign on the front lawn and the “Zilter” van pops up, a guy hops out, and he spray paints over the agent’s name, the broker’s name, and their phone number. Now by law, you must havethe listing agent’s name on the sign. So, he staples a little business card to the bottom where technically you could see it, and then puts a different agent’s name up there on the sign.

What this guy has done is to hijack the listing.

Florance continued the analogy:

The listing agent, who is now really mad, drives off to a showing. When he turns around, however, the dude who sprayed over his sign is now sitting in the backseat tracking where all his showings are. (This is a reference to the fact that Zillow recently acquired ShowingTime.)

Bad for both consumers and agents?

Based upon his interviews and focus groups with buyers from all over the company, Florance is convinced Zillow’s model doesn’t serve the consumer well. Moreover, when a consumer hits that button on Zillow, they’re starting “a relationship with a number five robo caller in the United States.”

Florance went on to say, if they touch that button:

They’ll get shocked with robo calls and texts — it’s a horrible environment.

The buyer also wants to be able to talk to someone knowledgeable about the property, not a robo call center. That experience doesn’t work for the buyers, and it doesn’t work for the agents. The agents obviously do not like having to pay for leads that used to come to them automatically.


CoStar’s model will direct listing leads to listing agent, not to buyer’s agent who is paying a portal for premium placement.

The war is on

In early 2022, CoStar will begin competing head-to-head against Zillow in New York City. CoStar has purchased Homes.com (which will compete with the Zillow.com) and HomeSnap which will compete with Zillow’s agent products.

Zillow currently has a huge strategic advantage over CoStar with consumers. According to Statista.com, as of October 4, 2021, Zillow is the leading real estate and rental website in the United States with 36 million visits a month.

Barton’s decision to drop the Zillow Offers program and allocate his resources in their core model is a smart move given that CoStar is going on the attack. In the meantime, agents now have a powerful way to counteract Zillow’s Zestimates when they price properties.

It will be fascinating to see if CoStar can successfully prevail against Zillow — popcorn, anyone?
 
Zillow Drops iBuyer Program, What’s Next?
Article Courtesy of: Inman News
By: Rainy Hake Austin
 
 With a new year on the horizon, it’s important to begin planning for 2022 — and this includes how you’d like to effectively market your business.

When developing your marketing budget for 2022, I suggest taking a holistic approach to your marketing strategy and how best to leverage the new and existing channels at your disposal.

Your budget should account for a diverse marketing mix including print, digital, social media, mobile, direct mail, event marketing and more. Here a several tips for setting up an effective and strategic marketing budget for 2022.

1. Consider the long-term investment

When developing your marketing budget for 2022, consider marketing as a long-term investment for your business — not just a line item.

In our industry, marketing has become an essential element of the business and must be treated and approached with the same emphasis on strategy and investment as any other part of your yearly plan. Consider how to best anchor and support your goals and objectives with targeted marketing approaches throughout the year.

2. Plan early and often

Though the end of the year is a popular time to plan, it’s prudent to take inventory early and often when it comes to your marketing budget and strategy. Examining the success and failures from previous years and pivoting when necessary while reinvesting in areas giving you higher ROI is key.

3. Base your budget on goals

What do you want to accomplish in the new year and what marketing strategies do you want to implement? Don’t guess these items, but rather, strategically tailor your year to meet key milestones.
Your marketing budget and goals should be an extension of your business strategy. This will help to set a clear intention and plan ahead.

4. Develop markers for measurement

Set markers for measurement throughout the year and account for them often. It’s important to check in on how your campaigns are performing and where adjustments need to made, ensuring flexibility to shift when necessary in order to reestablish funds in areas giving you the most ROI. This can vary from person to person and business to business. For instance, you may want to invest a portion of your budget in tracking a QR code, a Facebook advertising campaign or Google analytics.

5. Follow a hub and spoke model

Your marketing budget should follow a hub and spoke model with one central point to send direct marketing efforts for conversion. This can be an agent website, Instagram page or another channel. Ensure your budget is aimed at strengthening this model throughout the year.

To conclude, when developing a strategic and effective marketing budget for 2022, it’s important to consider several elements. These include creating markers for measurement, basing your budget on goals, having a hub and spoke model, and planning early and often.

Taking these various factors into account will ensure a successful marketing strategy in the new year.

Rainy Hake Austin is the president of The Agency in Los Angeles, California
5 Tips for Building Your 2022 Marketing Budget

 

Article Courtesy of: Inman News
By: Andrea V. Brambila


The National Association of REALTORS® (NAR) will consider a policy requiring multiple listing services to display buyer broker commissions on their listing sites and in the data feeds they provide to agents and brokers at its annual conference next month, but will not consider any policies related to lockboxes.

NAR’s MLS Technology and Emerging Issues Advisory Board, which is part of its Multiple Listing Issues and Policies Committee, held a meeting on Oct. 5 to discuss policies to put forward to the full MLS committee for a vote on Nov. 13 at the Realtors Conference and Expo in San Diego, California.

Last month the advisory board approved several policies the trade group will consider, including a request from real estate brokerage giant Realogy to change a rule regarding listing broker attribution as well as rules regarding buyer agents touting their services as “free,” filtering listings by commission or brokerage name and broker back office feeds. The proposed policies regarding buyer agents and filtering listings by commission were inspired by a now-scuttled antitrust settlement between NAR and the U.S. Department of Justice.

The settlement would also have required NAR to repeal any rule that discourages MLSs or MLS participants from publishing or displaying to consumers compensation offered to other MLS participants and would have mandated that MLS subscribers provide information about such compensation to their clients.

In the wake of the settlement, at least 65 MLS have changed their rules to allow public display of buyer agent commissions.

Would require MLSs with listing sites, but not agents or brokers, to display buyer broker commission

NAR policy currently allows MLSs to prohibit disclosing to prospective buyers the total commissions offered to buyer brokers.

Now, NAR, which has more than 1.4 million members, will consider a proposed policy, MLS Policy Statement 8.8, that requires MLSs with public-facing websites to display the buyer broker commission and requires MLSs to include the buyer broker commission in their Internet Data Exchange (IDX) and Virtual Office Website (VOW) feeds, but does not require that the brokers and agents using the feeds display the buyer broker commission. IDX and VOW websites display a pooled set of listings from the MLS.

The proposal reads:
MLSs must include the listing broker’s offer of compensation for each active listing displayed on its consumer-facing website(s) and in MLS data feeds provided to participants and subscribers, and must permit MLS participants or subscribers to share such information though IDX and VOW displays or through any other form or format provided to clients and consumers. The information about the offer of compensation must be accompanied by a disclaimer stating that the offer is made only to participants of the MLS where the listing is filed.

According to the advisory board’s meeting minutes, the rationale for the proposal is that “[d]isclosure of the offer of compensation to buyer agents (including non-agency relationships defined by state law) will reinforce transparency for the clients and consumers working with MLS participants and subscribers in a real estate transaction.”

Any proposals approved by the MLS committee would then go to the NAR board of directors, who will meet on Nov. 15. If the board votes in favor of the policies they would go into effect Jan. 1, 2022 and MLSs would have until March 1 to implement them.

No lockbox changes for now

The NAR-DOJ settlement would also have required NAR to adopt a rule that requires all member boards and MLSs to allow any licensed real estate agent or agent of a broker, to access, with seller approval, the lockboxes of properties listed on an MLS.

Discount real estate brokerage REX Real Estate, which is licensed but is not Realtor-affiliated, has been particularly vocal regarding the elimination of rules that limit lockbox access to Realtors, calling such rules “anti-consumer.”

The MLS advisory board, which has no further meetings planned before NAR’s conference, decided not put forward any lockbox-related policies this time around. Instead, the advisory board discussed establishing a new joint “Work Group” with NAR’s Professional Standards Committee “to review the ethical obligations and MLS policies, including reinforcing the duties set forth in Article 3 of the Code of Ethics, and further ensuring that all brokers have access to listed properties consistent with the sellers’ or owners’ authorization,” the meeting minutes said.

NAR work groups are typically composed of a subset of committee members who study an issue in depth and may propose related changes. Article 3 of the Realtor Code of Ethics requires Realtors to cooperate with other brokers except when cooperation is not in their client’s best interest.

“Please note that the discussion referenced was about ensuring that all brokers have access to properties, not specifically lockbox access,” NAR spokesperson Mantill Williams told Inman via email. “If a Work Group is formed, we anticipate that its purpose will be determined later this year or in early 2022, and that it will consist of representatives of the Multiple Listing Service Policy Committee and the Professional Standards Committee.”

Amendments to proposed policies

The advisory board also voted to slightly amend two of the proposals that will go before the full MLS committee in November. The policy proposal for a single MLS data feed now reads (underlining indicates additions):

Policy Statement 8.6: That MLSs must offer a Participant, or their designee, a single data feed in accordance with the Participant’s licensed authorized uses.


And the policy proposal for a broker back office feed now reads:

Participants are entitled to use, and MLSs must provide to Participants a Brokerage Back Office Feed per the Data, Use and Terms established below:

“Data” means all real property listing and roster information in the MLS database, including all listings of all statuses available to all Participants in the MLS, but excludes (I) MLS only fields (those fields only visible to MLS staff and the listing Participant), and (ii) fields and content to which the MLS does not have a sufficient license for use in the Brokerage Back Office Feed.


The latter change “further defines and explains the listing information that is to be available as part of the Brokerage Back Office Feed,” the advisory board said.
 
Buyer Commissions In, Lockboxes Out--When NAR Votes Next Month
Article Courtesy of : Inman News
By: Danny Brown

Now that some semblance of normalcy has returned and open houses are back, we should all be rethinking how we hold and host them. Of course, we need to take health and safety measures seriously — that’s a prerequisite to everything we do now.

First and foremost, an open house is an opportunity to showcase your brand, personality, knowledge and style. There is no single prospecting tool that is more effective and impactful.

You are the host everyone is coming to greet, and this is your time to shine. If you are not taking the time to prepare and set up your open house properly, you’re missing out on a major opportunity to connect with buyers, sellers, brokers and neighbors. So, when it comes to open houses, here are the eight things you need to keep in mind.

1. Pre-game prep

An open house is like a performance, and you need to harness your energy so you can perform at your peak. Do not stay out late and party the night before and show up exhausted or hungover. In fact, do the opposite. Hydrate the night before like a professional athlete does before a game.  

Make sure you get a good night’s sleep, and be well rested. In the morning, practice stretching or get a yoga or pilates class in. You can also go on a light jog or hike. You are going to be on your feet for three to four hours, so preserve your energy, and do not make Sunday morning your hardest training day of the week.

I made the mistake a few times of going for a long run and showing up to my open house with blisters, limping and wincing in pain. Also, have a healthy, hearty breakfast or brunch, and pack healthy snacks or a lunch to bring with you.

2. Know your stuff

Do not show up to an open house and expect results if you are not prepared to be an expert in that particular neighborhood or price point. Make sure you know all of the relevant comps and even the history of sales around the house for the past five years.  

Know the price of the last tear-down, the price of the new construction homes and the average price per square foot. It’s imperative to come armed with knowledge of an off-market listing in the area or an upcoming listing that no one knows about.

You have to know more than the neighbors and buyers walking in the door, and you have to showcase your expertise, which includes knowing the restaurants, shops, schools and whatever else is going on in that neighborhood.

3. Signage

An open house is an opportunity to advertise at no cost. Invest in as many signs as you can afford, and put them out on strategic corners. Put out 20-plus signs if you can!

If you don’t want to do the grunt work, pay a sign company or someone else $60 to put out your signs at 8 a.m. and pick them up at 8 p.m. 

In the early days, I used to get up at the crack of dawn on Sunday, tape on the property address and put out signs. I always came home with cuts on my hands. I hated it, and eventually, I bit the bullet and realized that a sign company was a cost of doing business and a great ROI. I look at it as 12 hours of free advertising and branding!

4. Activate the space

Appeal to all of the senses at your open house, and set the right mood. Light a candle that smells good — something light and natural that is not nauseating.

Play music in the background, but know your audience. Do go nuts and blast Eminem or risk offending some folks. (But then again, you might find that one client who is a diehard Slim Shady fan, and instantly became their broker of choice.)

Open up the windows to get fresh air, turn on the lights and lamps, and have bottles of cold water and healthy snacks in the kitchen. If it is a hot summer day, turn on the AC; if it’s cold, turn on the heat. Activate the space. 

5. Make it a virtual open house

Since COVID-19, began many buyers have become uncomfortable with coming to open houses, so it is critical to livestream them on Facebook, Instagram and YouTube.

Make sure the lighting is good, and there are no sound issues. I often get to the open house 30 minutes before it starts or the day before and shoot a video tour, room by room, and post it on YouTube so that buyers can access the tour 24/7. Also, that way, you expose the property to a much larger audience.

6. Read the room

An open house is a time to let your personality shine and connect with people. That said, you need to be protective of your energy and focus, and make sure you do not get distracted talking to nice people who want to monopolize your time and energy yet will never buy, sell or refer your business in a million years.

Of course, be polite to everyone, but you have to read the room and make quick decisions about who to spend time with. You also do not want to oversell the listing if they are not interested.  

You need to be nimble and shift gears quickly, and bring up other properties that may be a better fit. This truly is an art that takes years of practice. The more open houses you do, the better you will get at it. 

7. Safety first

Always have a safety plan at an open house. Make sure a family member, friend or fellow agent knows you are hosting an open house, and make a plan to call them a few minutes after the open so they know you have left safely. 

It is also important to hide your valuables or purse so someone does not snatch it while you are showing a buyer the gym in the basement level. Of course, you need to alert your sellers that they need to clear out all valuables, medications and jewelry, or at least hide everything well.

If the home is large, you should have another agent or assistant helping you. It’s always safer to have two people hosting the open house when possible. I remember a few years ago, there was a thief coming into open houses and taking flat screen TVs off the wall and running out. It happens, so be alert. 

8. Follow up, and play the long game

You must follow up with any good leads after the open house or no later than the next morning! It is best if you have an upcoming listing or an off-market opportunity to discuss with them as buyers are hungry for new listings and pockets they have not heard about.  

Be prepared to cultivate the lead, and be patient if they are not ready to pull the trigger. Most buyers take a year or two — and sometimes more — to take action, so add them to your database, set up an auto notification, stay in contact with them, and invest in your future business. 

I have had a few instances where I have received a call from someone I met at an open house five years ago who wanted me to come list their house. This business is a marathon, not a sprint. 

If you are going to commit three to five hours on a Sunday where you can be enjoying yourself or spending time with your family and friends, make the most of it. If you follow the steps above you will put yourself in a position to have success.  

Of course, there will be Sunday afternoons where you are not feeling it and can’t muster the energy or enthusiasm. I have been there many times and have kicked myself for wasting my time when I could have been resting or doing something fun.

If you are not up for doing the open house right, you are better off not doing it at all. Like everything in life, the more you put in the more you get out. 

Danny Brown is a luxury Realtor with Compass in Los Angeles, California.
8 Ways to Get The Most (Leads) Out of Your Next Open House

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GBAR 2022 Roadshow
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