The Actual Listing Presentation
In the previous chapters we focused on how to gather an unending supply of listing leads. We discussed becoming the best agent for the job. We mentioned the necessity of learning market statistics, and how and where to find them. We discussed how you can increase your credibility and power by arming yourself with this basic and relevant knowledge.
Next we determined the best way to build an accurate CMA, or comparative market analysis, and then we touched on the theory behind my listing presentation. If you’ve been studying the information, you know how and why this presentation works.
Now, I will show you how to present my listing plan to a seller client. I would encourage you to print it out and read with a pen or highlighter in hand, and to take notes. You should expect to review the material again and again until it has been fully absorbed. And if you do, I promise that you’ll be listing properties at 8% or more — every time!
A day in the life of a listing agent.
I want you to pretend that you’re the listing agent in this story. It may not be a true story for you yet, but it could be. It’s been true for me countless times. Imagine that it’s a Thursday morning. You’ve just come into the office and noticed a CMA request that arrived from your website overnight. Along with it, so did eight buyer leads.
If you’re like most agents, that kind of good news doesn’t happen often; but, in my case, not a day goes by that I don’t receive one or two CMA requests from potential sellers and fifteen to twenty buyer leads — and all because of the technology that I use to capture traffic from my website.
But once again I’m getting sidetracked. We’ve already talked about the lead capture gateway and how it’s a critical piece of your arsenal for generating an endless supply of listing and buyer leads. For now, let’s stick with the listing presentation.
Okay. So it’s Thursday morning, and you have a new CMA request in your inbox. The first things you do are to pull up the tax value and print out the tax sheet, which will tell you a lot about the property and the CMA request. Using the tax records and the appreciation rates for that area, you determine the approximate value of the home.
Next you log into your MLS database and pull up all the closed comparables for the seller’s subdivision, with the approximate size and number of bedrooms and baths. There are twenty-one comparables to use and only one obvious distressed sale, so you eliminate that one from the average. After finding an average for the other twenty, you print out the comps in a one-liner format and note the “average” price on the page.
Next you pull up all the active comparables listed in the MLS (three, in this case), average them, print out the query, and write down the average price. If there are not any active comps, you might want to use the “list price” average for the closed comps, since the list price was the price they would show if they were “active” listings today. The idea is to include these so you don’t inadvertently skew the average price downward.
Now add these three numbers that you’ve written down, and divide by three. Now you have your average sale price. Multiply it by 105% to determine the high end of your reasonable range. Then multiply it by 95% to give you the low end of the range. What you’re doing is adding and subtracting 5% from the average price or mid-point. In a matter of minutes, you’ve completed a very thorough CMA that’s beyond scrutiny.
So now you call the seller and thank him for visiting your website. You tell him that you received his home-valuation request and that you’re in the process of compiling data to determine the home’s value. I generally tell the seller that I’ve seen very nice homes and some pretty bad homes, and some in the middle, and I’d like to know where in that range his home is.
I generally ask the seller to rank his home on a scale of one to ten; one being a bomb had gone off, and ten being a brand new home. Then I ask him to pretend that I’m Stevie Wonder and to give me a verbal tour of the place, since I’m not actually there to view it.
I allow him to take me from room to room, all the while I’m asking him for specifics about the home’s curb appeal and other possible attractions. After touring the house, we next “go” outside, where I have him talk me through the yard, the exterior paint, the roof, the overall condition, the immediate neighbors’ homes, and the landscaping.
Then I generally say something like, “Gosh, that sounds like a really nice house! Why on earth would you want to sell it?” The response I get is very important because it can provide me with the seller’s motivation and, often, his time frame.
Next, I try to determine whether or not the seller has a realistic grasp of the home’s value. To do that, I then ask him if he has any idea what he would like to sell it for, in a perfect world. Sometimes sellers aren’t completely practical about these things (I bet you already knew that!), but generally they are. And if a seller isn’t being realistic, he will likely believe that his home is worth much more than the initial CMA would indicate.
In that case, I proceed with something like this: “Wow! You must have a really nice house. I’m looking at every single home that’s been sold in your neighborhood during the past year, and I’m not seeing anything within $15,000 of that price. Can you help me understand what features your home has that make it stand out so much?”
Many times the seller will tell me that the house down the street sold for that much even though it isn’t nearly as nice as his. Generally, however, the seller down the street just didn’t want anyone to know that he had to sell his house for much less than he’d been asking. But now that you have the comps in your hand, you can tell the seller exactly what a house sold for, and sometimes that fact is all you need to move the seller into reality.
On the other hand, sometimes your potential client’s home actually is worth more than you would’ve expected, so you also need to be open to what he tells you. On those rare occasions, you should be prepared to tweak your CMA a little. Having asked him up front what his expectation is, however, keeps you from the embarrassment of not including a legitimate feature that adds value to his home. You don’t appear to be trying to undervalue the seller’s home.
Now that you know the seller’s motivation, his time frame, and his opinion of the property’s value (it could even be that he had a recent appraisal, which he’s now using to test you), you can tell him that you’ll complete your research and then call him back with your valuation. Simply set up an appointment, and either call or visit in person.
In the next chapter we’ll discuss how to make your listing presentation — whether you choose to do it in person, or take the listing over the phone like I have done many times. Either way, you’ll want to know what to say when you talk to the seller and we will cover that next, so you won’t want to miss it!
View all articles in this series:
- The New Ultimate Listing Presentation (Part 1)
- The New Ultimate Listing Presentation (Part 2)
- The New Ultimate Listing Presentation (Part 3)
- The New Ultimate Listing Presentation (Part 4)
- The New Ultimate Listing Presentation (Part 5)
- The New Ultimate Listing Presentation (Part 6)
- The New Ultimate Listing Presentation (Part 7)
- The New Ultimate Listing Presentation (Part 8)
- The New Ultimate Listing Presentation (Part 9)
- The New Ultimate Listing Presentation (Part 10)
- The New Ultimate Listing Presentation (Part 11)
- The New Ultimate Listing Presentation (Part 12)
- The New Ultimate Listing Presentation (Part 13)
- The New Ultimate Listing Presentation (Part 14)
- The New Ultimate Listing Presentation (Part 15)
- The New Ultimate Listing Presentation (Part 16)
- The New Ultimate Listing Presentation (Part 17)
- The New Ultimate Listing Presentation (Part 18)
- The New Ultimate Listing Presentation (Part 19)
- The New Ultimate Listing Presentation (Part 20)
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Matt Jones is the founder and CEO of FavoriteAgent.com, nationally syndicated columnist, broker, and best selling author of LCM: The Secret to Success in the New Age of Real Estate, The Ultimate Listing Presentation, Traffic: How to Sell Fast and Net More, Becoming a Mega-Producer, The Science of Online Marketing, 10 Steps to Real Estate Success, 20 Questions: Everything You Always Wanted to Know about Real Estate but Were Afraid to Ask, The Virtual Office Model, Max-Bang!, and The NEW Ultimate Listing Presentation. Jones' North Carolina-based company has been profiled by major media outlets as an innovator and a pioneer in the industry, and CNN's Pulse on America claimed FavoriteAgent.com is "changing the way real estate is being done in America." This article is syndicated in the following locations: iTunes, YouTube, Stitcher Radio, BlogMattBlog.com, RealBlogging.com, NewsGeni.us, TheCommissionCheck.com, RevampedAgent.com, and now Amazon Kindle.