As a Help-U-Sell broker, you rarely have to deal with tie-breakers when it comes to listing. Usually when the seller hears your superior offer and is satisfied that you can and will deliver, he or she is ready to sign.
But there are metrics you can introduce into the conversation whether you are competing with others for the listing or not, that will boost your credibility and differentiate you from the rest of the pack.
Average Days on Market. That means from listing to pending status. How many days of marketing did your average listing endure last year before buyer and seller agreed on an offer? That’s powerful information when you compare favorably against your peers. If your average days on market is 57, and the MLS is 85, that means you are 28 days faster (better) at getting your listings sold than your competitors. That’s huge! But even 10 days is worth crowing about. And here’s a clue: you will almost ALWAYS beat the MLS on this and the other three metrics. It’s just the nature of ‘average’ – your individual average should be better than their aggregate average. In fact, if it’s not . . . well you probably have a big problem in your business.
Average Sale Price as a % of List Price. On average, are you getting your sellers 97% of List Price in a sale? Or are you getting 95.3%? If your average Listing Price is $255,000 and your average price of a sold Listing is $253,000, you’re getting 99.2% . . . not too shabby! Now run the same calculation for the MLS. If you discover that the MLS average is 94%, you’re able to tell your sellers that you usually get your clients more than 5% more for their property than your competitors! Which is probably MORE than they are paying you! Now that’s powerful! And, once again, if you aren’t better than the MLS in this metric . . . well, you’ve got a bigger problem. By the way, it’s important that you count only Listing Sides here; comparing your average Listing Price with your Average Sale Price (including buyer sides) skews the results.
Per Person Productivity. Take your total number of closed sides for last year and divide it by the number of licensed people in your office. If you had 62 closed sides and 3 licensees, your per person productivity is better than 20 closed sides per year. Now, compare that with the MLS. You’ll be shocked. That average will probably be in the 6 to 10 closed sides per year range. Now, think like a consumer for a moment. Who do you think is going to do a better job of protecting your interests, of staying abreast of changes in the industry and finance, of solving notty problems when they arise in a transaction: the guy who does 7 closed sides a year or the one who does 20? Want to blow that 200 agent mega-office out of the water? Use this metric. You’ll beat the pants off them every time.
Fallout Rate. Of all the sales you made last year, how many fell out of escrow? Calculate it as a percentage and then compare that with the MLS. Your figure might be 10% and the MLS will almost always be higher, and sometimes significantly higher. If the MLS is 16% you can demonstrate to a seller that they are more likely to make it to closing with you than with a typical broker.
Put it all together and what does it sound like?
‘Mr. & Mrs. Seller, last year it took me, on average, 57 days to get a listing under contract. It took the MLS – which is every other broker – 85 days, which is almost a full month longer. So when you list with me, chances are we’re going to get this process over with quicker. I also got my sellers, on average, 99.2% of their Listing Price. In the MLS right now they’re only getting 94%. So I’m getting my Sellers more for their properties than they are actually paying me! The average agent in my office closed 20 deals last year. In the MLS, the average was 8. I know that’s hard to believe, but it’s true. Who do you think is better equipped to handle your transaction and solve problems when they arise? Thank you. Finally, last year only 10% of my sales fell through. In the MLS it was 16%. Put plainly: with me, you’re going to sell faster, for more money, with less likelihood of falling out of escrow, AND you’ll have the expertise of some of the most productive people in the local market making sure everything goes as planned.’
Now: DO IT. Get out your calculator, log into MLS, and run the numbers. And tell me what you find: I’m itching to share.
3 thoughts on “Differentiation: Four Key Metrics”
These are good points that in some ways are similar to the tactics in the traditional real estate listing presentation world. Good tactics to have for when there ISN’T a price advantage. When things were rocking in San Diego there were lots of companies with prices as low as ours at HUS. IpayOne even had the naming rights to the SportsArena as a credibility boost. (Not that it saved them from homaggedon) There is a company called Sell4Free that waives a listing fee if you buy with them. I think as HUS it is easy to become too focused on the potential savings the flat fee represents and get rusty on the inherent value at ANY price.
You’re right: these kinds of numbers are available to the most ordinary of brokers, not just Help-U-Sell. Still, if you surveyed the thousands of members of, say, the San Diego Association of REALTORS, you might find 1% or 2% actually using real numbers in their marketing. I also think there is a second piece to using these powerful stats: you’re going to get the home sold faster, for more money, with less likelihood of a problem torpedoing the sale . . . in exchange, the seller has an even greater responsibility to price it properly. All of your stats will suffer if you continually take overpriced and/or unsaleable listings.