Listings are everything in commercial real estate brokerage. Until you get your own listings and pipeline of listings underway, it will be a bit of a struggle. You will need a consistent flow of quality listings to generate a reasonable commission over time; that fact cannot be avoided. It is also very easy to slip into issues of complacency when you have a few listings to work on.
Most top agents will convert and sell exclusive listings on a ratio of (or better than) approximately 75% sold to 25% unsold. At peak times in the property market, that ratio will improve to over 80% sold and to under 20% unsold. Regardless of how ‘hot’ the market may be from a sales perspective for you, there will always be clients refusing to listen to business logic and market evidence in selling their property. Don’t struggle with an unrealistic client for too long. If they fail to listen to your recommendations then find other clients to serve.
Attracting Exclusive Listings
The following points apply to attracting, pricing and marketing quality exclusive listings today:
- Most commercial properties will be bought and sold in the same town or city. Approximately 80% of your marketing campaign should for that reason be focused in the local area and also your town or city.
- You can comprehensively service a property exclusively, because you have the time. When the client has committed to you as the agent of choice for a reasonable period of time, you can devote the effort to the property marketing process. You cannot and should not apply the same amount resources to any open listing. If you happen to sell an open listing, it will be a product of luck more than anything else. Clients with open listings should not receive a lot of your professional focus and skill; remember that they have not fully trusted you with the listing and on that basis you cannot fully trust them with the momentum of the sale. Sure, help them where you believe you can if you can see a potential result, however focus your efforts on your exclusive listing stock at every opportunity.
- Vendor paid marketing should be converted as part of every exclusive listing appointment. Pitch and present your services accordingly. As a general rule, set a target of dollars earned for marketing funds conversion on a monthly basis. Given the number of listings that you are working on at any point in time, you should be able to convert advertising funds equivalent to an amount of approximately 1% of the value of a property.
- Targeted marketing campaigns should feature as part of every exclusive listing appointment. Get involved at a personal level with all of your exclusive listings and quality properties. Tell the client exactly how you will be taking their property to the market in a comprehensive and direct way. Help them see how you are going to market, inspect, and negotiate the best price for their property.
- With every exclusive listing, determine the strengths and weaknesses that apply with each property to be promoted. The strengths of a property can be direct factors of attraction in the established marketing campaign. The weaknesses on the other hand may need to be resolved prior to any promotional process.
- Understand the levels of competition that apply locally to the property type both in selling and leasing. The factors of supply and demand will have an impact on the levels of enquiry and the discounts or incentives to be offered as part of selling and leasing.
Any top agent should be able to work on at least 10 to 15 exclusive listings at any one time. Beyond that point, things become a bit more difficult given the workload and requirements of focus on each listing and client. On that basis it is best to avoid open listings and concentrate on pitching and presenting for quality listings and your exclusive appointment.
When you control the listing stock, you control the property enquiry; other brokers and interested parties need will to come to you as the agent controlling the listing stock. As a general rule, listing control will always help you capture market share and property opportunity. Open listings can waste a lot of your time.
Simple Rules to Follow
Here are some simple rules to help you focus on quality listings in the best locations:
- Research the local area – Identify the best buildings and the best locations in your sales territory or zone. Those building should feature in your prospecting activities. Talk to the landlords and or property owners in each case. Also talk to the tenants in occupancy.
- Look at recent sales and leasing records – Over a period of time there will be historic sales and leasing records to tap into and work through. Those sales records will lead you to successful property investors and owner occupiers.
- Understand the property cycle – In your town or city you will find that local business activity will set the sentiment or the best times of year for buying and selling properties. There will also be times where properties should not be sold given that the level of expected enquiry is likely be low during local festivals and holidays. Maximise your prospecting efforts leading into the peak selling times of year.
- Track the enquiry rates – As part of every marketing campaign, track the levels of enquiry coming in through the different channels of media. You will soon understand the best marketing strategies to use in today’s property market. You will also know what people are looking for when it comes to quality properties and top locations.
So the message here is that you should think about the property marketplace strategically. Look for the factors of change and track the levels of current activity. Choose your property types and locations so that you can convert ever more listings exclusively.