Selling Soulfully with Jennifer Allan

For those who haven't encountered a "listing exclusion" yet, it's simply a request from a seller that if a certain person or persons buy the home after it goes on the market, your listing commission won't apply. For example, perhaps the seller knows a guy at work who says he'd be interested in purchasing the house, but he's still thinking about it. Your seller doesn't want to wait for him to make up his mind to go on the market, but neither does he want to pay you if the guy actually ponies up. So, the seller asks you to "exclude" this particular person from your listing agreement.

Should you do it?

My advice? Sure. Don't argue, don't explain, and don't make a big deal out of it. Write in the exclusion and get on with putting the house on the market. The chances that this guy is actually going to purchase the house are slim, but if he does, the seller will probably need your assistance to get the contract written and to closing. For which you most certainly may charge a reasonable fee.

No reason to go to battle over this. Save your energy for bigger things!

 The Summer of Soul Begins Saturday... Get Your Ticket here! 

You wanna know the top search term that brings new surfers to my website? Okay, there are two. The first is "New agent announcement letter." The second is "Sample listing presentation."

I offer a free sample listing presentation on my website if you join my VIP Lounge (that's free, too). Seems to be a popular item. I'm rather proud of my listing presentation - there's nothing boiler-plate or corporate about it - it's direct and to-the-point, conversational and informative. I've used it, or a similar version for years.

But over the last year or so I've been rethinking the idea of a formal listing presentation (Are listing presentations really necessary... or effective?). I've been experimenting with not doing it and have walked away from my listing appointments much more pleased with myself. But I wasn't sure... for sure.

Well, this last week, I met with a real estate agent in Dothan, Alabama to talk about selling one of my properties (the one where the squatter renter was FINALLY evicted!). She came to the house and asked me to show her around. She asked questions and actually listened to my (sometimes long-winded) answers. She took notes. As we toured, she casually mentioned other homes she'd seen or sold recently that were comparable to mine. Because she knew I was also in the biz, she respectfully asked for my thoughts on a marketing strategy. And listened.

After I was done showing her the house and grounds, she said she wanted to go back to the office and do her homework, now that she'd seen the property. She'd be ready to present her findings the next day if that was okay with me. It was and she did and I hired her.

No presentation. No fancy graphs or charts. No bio, resume or testimonials. Just a subtly demonstrated knowledge of the marketplace, a sincere interest in my situation and a respectful acknowledgment of my intelligence and experience. Had she shown up with a 90-minute formal presentation of how wonderful she was, how awesome her company is and how dangerous it is to OVERPRICE, I'd have tuned her out within 5 minutes.

Do I know her marketing plan? Oops, no, not really. I suppose I could ask and maybe I should. But her non-salespitchy "presentation" made me trust her.

Now, truth be told, this sort of quiet confidence takes awhile to develop. I certainly didn't have it my first year or even my second; maybe even my third. Well, heck, here I am in my 12^th year just realizing that I don't need a fancy presentation!

I do believe that the process of creating a formal presentation is good for the soul - it helps you to figure out what you offer and why you're special, and for the times when a seller seems to want something in writing, you have it ready to go. I have much of my presentation available on my website, so sellers can check me out ahead of time or after they've met me.

But during that hour you're meeting with a seller for the first time, it's far more effective to just BE there with them... asking questions, listening to the answers and demonstrating your competence.

So... I have my answer. No More Listing Presentations for me!

Dorky Announcement Letters - DEDorked!

I've been a real estate agent for twelve years. The entire twelve years, I've worked the traditional model... I get paid when the house closes. Sometimes I get paid BIG time, which sometimes doesn't seem proportionate (in a seller's eyes) to the amount of work I actually did.

But a significant part of why we make the money we do is that we agree to work on contingency - if we don't get our buyer or seller to a closing, we don't get paid, regardless of how hard we worked or how smart we worked. If we don't perform... we are not compensated.

Not many industries work under these conditions.

That's not really the point of this blog today, however. After all the fun a few weeks ago debating the value of our services, I got to thinking. Maybe I could offer a third fee option (I currently offer two; click here to read about them) - How about an upfront fee that is non-refundable, but significantly less than the seller would pay under a traditional commission structure?

Let's say, illustratively, the seller pays me $3,000 at the time of listing instead of, say, 3% at the closing. If my average sales price is $300,000, this saves the seller about $6,000. ($300,000 x 3% = $9,000 - $3000 = $6,000)

So, I was thinking I was pretty smart. I get paid upfront and in a world where a For Sale sign in the yard is certainly no guarantee of a paycheck in the bank, I might come out ahead. I was all ready to talk to my broker to make sure he was okay with it.

But... whoa, Jennifer, slam on the brakes.

I know how I feel when I pay upfront for something and don't get the results I expect. I'm mad, I'm disappointed, I'm frustrated. I'm certainly not feeling warm and fuzzy toward the person or company I paid upfront.

I don't want my clients to feel that way about me. If I take their $3,000 and then can't sell their home... do you think they'll be philosophical about it and happily refer me to all their friends? Probably not. They'll resent me and the fact that I took their money and didn't perform. Is this fair? Probably not, but it's how we human beings are wired.

So... I dunno. I'm kind of used to the idea of Pay for Performance and I feel good about it for myself and my business. I may not mess with something that's working...

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I recently had a listing expire after three months on the market. Nothing has sold in my client's neighborhood for almost a year, so it wasn't a big surprise. We gave it a shot and it didn't work out for us. No biggie. She was prepared for the possibility and has no hard feelings toward me.

But that's not an accident. I always prepare my sellers for the chance that their home won't sell, despite our best efforts (by "our," I mean mine and my seller's joint efforts to prepare and present a great product to market). I don't make a big deal about it and I certainly don't lecture them or otherwise insult their intelligence; I just ask a simple question:

"What will you do if the house doesn't sell?"

Then I shut up.

If the seller doesn't have to sell (and I'm happy to take those listings if they're reasonable on price), then I've planted the seed that I/we don't control the market and if the house doesn't sell, it might be beyond our/my control. If the seller does need to sell, it forces them to think about the unthinkable - that they'll own a house they don't want and can't afford.  The next thing you know, they're asking me what they need to do to ensure that doesn't happen. Suddenly, I'M THE EXPERT and they'll listen to me!

It also works beautifully for sellers who want to test the market at their price. A similar approach - "What if the house doesn't sell at that price? Will you be okay with that?" often works wonders in getting the seller to really think about what he's doing.

I don't consider myself a salesperson; I consider myself an advisor. Therefore, I don't try to convince my sellers that I can "sell" their homes. With the above words, I am relieved of the personal responsibility of selling a house that, for whatever reason, may not be sellable today. 

For the record, my listings are always priced well, always staged and always easy to show. That's my job - to help my seller prepare and present their home to market in the best possible light.

That's all I can do.

I was cleaning out old files this morning and came across this little blurb I wrote years ago and used in my listing presentations. If you like it... feel free to use it! 

What does a Real Estate Agent DO for all that money?
Many people think that the main reason you hire a real estate agent is for MLS exposure.  And, unfortunately, in some cases that may appear to be the primary service some real estate agents provide.  However, a GOOD agent provides much more than simply a For Sale sign and a listing on an online database.

Connections
A good real estate agent has great connections in the real estate world.  She has a readily available list of home improvement contractors (heating, roofing, structural, electrical, painting, plumbing etc.), one or two good handymen, a cleaning service, legal referrals and lawn service providers. You should never have to go to the phone book to find help during the marketing process.

Systems
A good real estate agent has systems in place to sell homes far more efficiently than a homeowner ever could.  Selling or buying a home within the established real estate system is incredibly efficient compared to selling or buying a home outside of the system.  Real estate agents have (or should have) a 7 day/week showing service, MLS access, a contracts library, lock boxes, signs and Internet sites.

Expertise
Obviously, one important reason you hire a real estate agent is because you expect him to know more about selling homes than you do.  Selling real estate professionally requires a license and continuing education, but in reality, 99% of a real estate agent's expertise comes from on-the-job experience.  And, the more experienced the real estate agent, the more expertise he has.  Every real estate transaction is a little different, with its own little quirks, glitches and special circumstances.  The best way to get in trouble is when you don't know what you don't know! 

Time
Your real estate agent will spend a lot of time managing the sale of your home.  There is far more going on behind the scenes than holding open houses and attending closings, although due to the above factors (connections, systems and expertise), a good real estate agent will be pretty efficient at their job. The time your agents spends handling the sale of your home will save YOU lots of time... and money!

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copyright Jennifer Allan 2007