In commercial real estate brokerage, it is important if not critical to maintain accurate local sales data relating to the location, the precincts, the building types, and the brokerages. In that way, you as the broker or agent can fully observe trends and changes. You can then adjust your prospecting and negotiation models. (NB – you can get many more real estate ideas here in ‘Commercial Snapshot’)
Frequent Changes in Local Property Market
The property market changes a few times each year, perhaps in unexpected ways, and that is why your sales data is so valuable. Information from the location will help you make simple adjustments to your prospecting and/or marketing plan to then get better results for your clients and for yourself. Use the sales data as part of your listing pitch; talk about how things are changing and use the data visually in graphs and charts. Show and use statistics from all the verifiable sales.
So, what should you look for when it comes to this data?
Look at the current listings and the properties to see what is selling today; then review what is staying on the market, and determine why some properties are moving faster than others.
Accuracy in sales figures
Accurate sales data will allow you to refine your critical strategies with clients and property listings. Here are some of the important elements or indicators to track as part of monitoring that commercial property listing and sales data:
- Current and future supply for the town or precinct – when you consider an area or a location for property activity over time, you can look at the ratios of vacant land to develop land. You can look at how redevelopment opportunities may be evolving, or new property developments may be arising. Assess the current and future supply for the location and the levels of inquiry that you currently understand.
- Local area demand for listings – throughout the year the level of inquiry for different types of property will shift and change. That local area demand should be tracked as an office, and by each broker. Soon you will see that some brokers are more active than others in attracting and converting inquiry. You will also see that some parts of your area or territory will have more levels of inquiry to work with.
- Time on market – every exclusive listing should be tracked as to time on market and conversion to a successful transaction. The information that you gather in that respect will be essential as you pitch, present, and sell your services with new clients and for new listings.
- Listings available by property type – it is always interesting to know how many listings are available in a property precinct when it comes to the property types. A shortage of listings will always drive prices upward given typical market conditions. An abundance of listings and a lengthy time on market will soften prices and negotiations. Understand the facts in the property market today by location and property type.
- Price trends and results – get to the real facts of every property sale. The asking price is typically not the resultant price unless the property market is overheated. Some clients incorrectly base their listing targets on inflated asking prices; I go back to the point that accurate figures will help you with your listing pitch, your client recommendations, and your marketing momentum. Get the prices and the sale results so you can talk through the logic and the direction of every successful local property sale.
- Marketing strategies that help sale – How will you best market a property for sale? Do you have your reasons for certain promotional choices? Can you stand out with better promotional choices when compared to your local competitors? Make your ideas of promotion clear and base your recommendations on solid logic and local property evidence.
This sales data from the property market will help you show and prove your sales recommendations to a client or customer. Relevant commercial real estate information like this will also help you close a negotiation faster.