In his latest column Jonathan Rolande explains why estate agents need to ditch selling techniques and brush up on persuasion to ride out a falling market.
If you’re lucky enough to be under 35, the current property market probably feels like sailing in uncharted water - the last time rates were high and prices fell was way back in 2008. Back then, there was almost no liquidity, mortgages disappeared almost overnight as lending fell 60% effectively killing the market.
We’re seeing lending volumes and transactions falling again. Sales are taking longer and the fall-through rate is climbing.
This is a potentially toxic combination for estate agents who rely on a steady flow of fees coming in. As we all know – and most of the public don’t – margins in agency are slim - portals, offices, staff, marketing… the list of outgoings is long and the bills roll in month in, month out – even when the fees don’t.
But although things are not as bad as they could be - or were 15 years ago - but as I have said here before, everybody in the sector should be hoping for the best, whilst quietly planning for the worst. So incomes should be maximised, and costs cut where possible.
There’s a mindset change needed too.
I’m not just talking about us, but the public too – our sellers and our buyers.
In booming markets, salespeople are king. Those with energy and drive are well rewarded. Enthusiasm for the market is infectious. Good salespeople take on more stock than competitors and give buyers that extra push to make the deal. Cross-selling additional products is easy – nothing is more appealing than a confident agent who isn’t desperate to make their next deal.
But if the current conditions prevail, and it looks like they will, we can expect to see many of our star performers struggle. As sales figures flounder, impatience and desperation set in. high flying colleagues will frankly, not be able to hack it. A case of the brightest candles burning the quickest.
So what mindset will help?
Until things get back to something more like we have been used to, it will be the persuasive negotiators who win through. Clients won’t be pushed or rushed into big decisions like they have been.
Sellers are going to have to be persuaded that it still makes sense to go on the market. they have to be helped to forget the 2022 value they have in their minds and instead see the sense in selling now, even at a lower price.
Buyers will need to be helped to see that buying a property isn’t a favour to the agent or seller, but something tangible, life-changing, even life-affirming. Somewhere to finally escape the rollercoaster of rental, a place for the long-term, a home first and an investment second.
Persuasive techniques do take time, it’s tortoise, not hare but even subtle changes have a noticeable effect. Some of the key points are
· Establish credibility. That doesn’t mean simply bragging about being the top office in the town. Frame yourself as an expert in your area, somebody who lives and breathes it and frankly knows more than anyone else about it too. Getting out to meet people at business and social events, creating the right content on social media and releasing news stories to the press get results.
· Find the common ground. A seller reluctant to take an offer might not have thought about renegotiating an onward purchase. A buyer stuck at a low price might need figures broken down “Yes it’s £5000 but that’s £5 a week on a mortgage for your perfect home.”
· Keep your position strong. You’re the expert after all. Have facts and figures to hand to back up what you say. A good example would be the good news about inflation despite Thursday’s interest hike and some lenders beginning to reduce rates. Create some punchy graphics with statistics that you can send them right away on email or Whatsapp to back up your case.
· Use emotion. The less salesy approach will build a real and long-lasting working relationship with clients, in many cases, you’ll be really listening to their needs when others haven’t. By doing this, you can truly sell to their requirement. And it will be effortless.
Things are going to get difficult but it won’t last forever. Those that don’t get blown off course by the economic storm will come out of it leaner and stronger. We just need to adjust our sails for a bit.
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So near, yet so far.
Persuasion is the only way to conduct business but framing yourself as the Expert to establish credibility invites logical thought and decisions from a vendor. Something they only consider when there is an emotional connection.
For any agency interested in knowing more about persuasion,
Search the free pdf download of Warren Blair's The Forbidden Keys of Persuasion.
If you can't persuade, you can only Sell and nobody likes you for that.
"Frame yourself as an expert in your area, somebody who lives and breathes it and frankly knows more than anyone else about it too. Getting out to meet people at business and social events"
It is a job not something to live and breathe. The people I know who have lived and breathed their job are divorced.
I have better things to do in my out of work time to waste it at boring award events etc and if I banged on to my mates about building and selling houses when we meet I would soon not have any mates left.
No one is interested in other people's jobs.
Well said, Janet. There's a fine line between being 'professional' and being 'too professional'.
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