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One of the themes that’s come out in the recent INMAN conference is the whole need for a single system to guide the agents and make the customer process easier. Mark McLeod – CEO of Growth at Ray White – joins Kylie Davis from Core Logic and discusses how Ray White has successfully been ahead of the curve in this area.
In this 9-minute video, you will learn:
What role technology plays in Ray White’s business philosophy
How easy or difficult technology will be in the future
How to implement new technology platforms smoothly
Mark’s thoughts on the issue “Is it the technology driving the agents or the other way around?”
Mark’s advice to agents who are trying to work out what technology to go with
Rising house prices, student debts and changed expectations from the Millennial generation are changing expectations and the traditional model of home ownership.
The INMAN Connect 2018 conference brought together four new startups in the home ownership space that are rewriting traditional models and creating what’s now being known as the shared equity economy.
“Share equity is as term of new companies and models that are challenging what has always been considered a truth – that you either own or you rent,” said Fabrizio Tiso from Irene Retirement.
Traditional models are based on the idea that a couple – usually married or in a relationship – purchase a property under a shared title, putting up a deposit of 20% and paying down the mortgage with a financial institution until the property is owned outright.
But new shared equity models introduce many variations, allowing for smaller – or no – deposits, co-ownership amongst friends, and even options where the goal is to own or trade a proportion of the property with a third party, such as builder or specialised investment institution.
“The 30 year mortgage as an instrument of home ownership was developed out of the Great Depression,” said Sahil Gupta from Patch Homes. “In most industries, people have the choice of using debt or equity based on the cost of capital. But in housing, this has not been an option until now.”
Here’s a summary of some of the new models now available:
Pre-sell your home to fund retirement
Irene Retirement is a new take on the old reverse mortgage concept but based on equity. It allows elderly homeowners to sell their home, yet continue to live in it or receive income from rent. Retirees sell their home to Irene, get cash upfront and never pay property taxes, homeowners insurance, or big-ticket maintenance costs again.
Just own a bit
Let’s say a house costs $100,000. (Hah!!) You have a great job and can pay a mortgage (let’s face it, it’s cheaper than rent), but you’re struggling to pull together the deposit. Unison HomeOwnership solves this problem by providing you with half the down payment ($10,000 in our example), but this money is not a loan, it is an investment with the outcome being that Unison own one tenth of the property. When the time comes to sell and you achieve a price of $120,000, you pocket $108,000 and Unison receive $12,000 for their share. Equally, if the price goes down, Unison wear their share of the loss.
Converting equity to cash
In a similar vein to Unison, Patch Homes are a finance company that shares a proportion of the property’s ownership and shares in the future appreciation or depreciation of your home’s value. Imagine you own a home (or are paying it off) and want to renovate the kitchen. Rather than increasing your loan amount – and monthly repayments – Patch gives you the option of ‘selling off’ a proportion of your homes equity with Patch recouping their money when you decide to sell.
Rent til you buy
You’re a well paid Millennial with a student loan who can afford to rent but can’t scrape together a deposit for a home. With Divvy, you find the home you want to buy, lease it from Divvy and every monthly rental payment builds up your home equity. Divvy claim that if you rent for three years through them, you get a 10% deposit.
Kylie Davis is the Head of Content at CoreLogic. She was a speaker at INMAN Connect 2018 in San Francisco on Robots and Automation. Connect with her on LinkedIn
As a salesperson, the next time you feel you are losing deals because of price, take your prospect to a cycle shop and ask them if they were to ride a bike, which one of the helmets they would buy – the one that’s on sale for $10 or the sleek, ventilated $150 model that promises it meets all testing standards?
The bet is they’ll opt to buy the $150 model. Why? You need guaranteed protection from a helmet in a crash; as a cyclist you need good ventilation; and if you’re racing, you need a good aerodynamic design. All of which are promised by the more expensive model.
The same is true for many of the products and services being sold every day by professional sales people. Everyone wants a low price. But it’s what customers need that really counts. As a salesperson it’s your job to determine what is needed and then show the customer how you can meet those needs.
In many major buyer organisations today executives are paid based on the amount they can shaved off a purchase price. As a result, they look not at value, not at risk, but at the price. And as they push suppliers for the lowest price they usually increase the risk of failure.
Most reasonable prospects will pay a higher price for guarantees. Here’s what buyers are saying is important to them:
Help and guidance with complex purchases. People who make multiple, varied or complex purchases are often not as knowledgeable as you might think about what they are buying. If you see your role as that of an advisorto a harried prospect, you can get an advantage over your competition.
Quantity, quality, timeliness, accuracy.Customers need to get what they’ve ordered. They need it on time and in top condition.
Minimal stock carrying costs.Your prospects might need just-in-time inventory, which means nothing is received late and they don’t have to keep too much on hand. Prospects will tell you they want a low price, but they will cut you off as a vendor if you foul up delivery.
A technically current, financially sound vendor. Many low-price competitors go broke fairly quickly because they’re cutting corners somewhere. Smart buyers are more concerned with the stability of your company, the quality of your product and your ability to deliver on time than they are about prices.
More certainty on A items than on B or C items.A items are those a business can never be without; B and C items are less important. In the airline industry, for example, fuel is an A item, ice for drinks might be a B item because they are important for passenger satisfaction and service, but not crucial for flight operation, and drink stirrers a C item. The lack of B or C items won’t put a company out of business; lack of an A item spells major disaster. Know where your product or service fits in the hierarchy.
Many sales people, especially those new to sales, often take it personally when a prospect says ‘NO’ and fail to persist with their prospecting efforts while others turn prospecting into stalking not knowing how to engage a prospect effectively. Either way, these people are failing to favourably and persistently position themselves with prospects thus limiting their sales opportunities even further. In sales there is a fine line between persistence and stalking a prospect.
Did you know:
Over 50% of sales people give up at 1st contact if they get a ‘NO’ from the prospect, never to go back to that prospect again.
At the 5th contact 7% of sales people are left to speak with the prospect to see if they can do business together.
At the 8th contact there is only one sales person left to work with the prospect. Hopefully it is you.
So why do these figures persist? What were the successful sales people doing that the others are not? How do you capture the attention of your prospects and determine whether or not they want to engage with you and how often should you be making contact? Assuming you are making contact with prospects, the first thing you have to ask yourself is: if you prospected yourself would you be worth listening to? If you get a ‘NO’, you cannot blame your prospects for not being interested either.
The second thing is to assess where your prospect is at on the ‘ready to buy now’ scale and how you are going to maintain contact with them if they are not ready to buy now. Because, folks, not everyone is a viable prospect all the time. Sales people have to come to realise that not every prospect is ready to work with you straight away, however this does not mean they will not be viable in the near future. Our job in this instance, is to work out where our prospect is at and find out when they are likely to see what we do as relevant to their situation. If they are not ready now does not mean they will never be ready. Our challenge as sales people is to know how to remain in contact with and be relevant to potential prospects while not putting them off or having them want to take out an AVO (Apprehended Violence Order) on us.
The brutal facts: at best, sales people tend to check in on their prospects on a random basis, leaving their prospecting efforts to chance. They also tell us that they are worried about what to say to prospects when they follow up and do not know where to start or how to capture peoples’ attention. They think prospects will not be interested in speaking with them and then they shoot themselves in the foot by not calling the prospect at all or messing up the prospecting call by not engaging with the prospect and finding out if we can talk now or in the future.
Like every aspect of selling, following up on prospects in your pipeline should be part of a planned routine. In our experience, with the exception of prospects already in the sales cycle, that line is usually drawn at about one direct contact every 5 weeks. Rather than get caught up worrying will the prospect pay attention to you or not, let’s look at the many ways you can to stay in meaningful touch with prospects and not be considered a stalker. Plan to use a combination of direct contacts (via the phone) with indirect contacts (email, social media, etc.) to stay in touch with prospects.
Tip: using the phone exclusively is generally not the best way to stay in touch with prospects. Instead we suggest you mix phone calls with email and social media which can be both individualised and general interest (to the prospect), rather than generalised corporate brochures.
An effective prospect contact program could include…
Week 1: a follow up telephone call with action items noted for the next direct contact
Week 3: send a company email newsletter, announcement or article. It doesn’t matter what you send as long as it is content-rich and not an advertisement for your products or services.
Week 4: Another indirect contact via email or social media such as something specific to the prospect i.e. a news article, something about their industry that is relevant to them, their company etc. This contact is designed to strengthen your personal relationship and build rapport. But please note: it must be sincere and genuine or your efforts will be seen as sycophantic and grasping.
Week 5: Another follow up telephone call – this must be structured by defining a Valid Business Reason (VBR) for your call to your prospect – a VBR is something of interest or relevant to your prospect not you.
What about Week 2? After you initial dazzling VBR in Week 1 give your prospect time to digest where you are coming from. If they are not ready to see you yet what you say can start planting seeds in their mind so that the next time you contact them you are building a strong case for them to want to see you down the track.
Important point: When making a follow up telephone prospecting call, make sure that you are not still thinking about what to say as the phone rings. Even if you an experienced sales person you need to work out our intentions and what you are going to say before dialling the number.
Establishing your VBR by jotting down a few key points about what you want to convey to your prospect and having a fall back position handy just in case the initial VBR does not work is the sign of a good sales person. Even practice saying out loud what you want to say in that first 10-15 seconds is very helpful.
If it doesn’t sound right to you then it isn’t going to sound right to your prospect – you can bet on that. So ‘would you listen to you?’
Remember: Prospecting is the oxygen that fuels the sales fire and without effective prospecting we cannot sell. If you are curious about being effective at prospecting then here are some useful articles that will add to your sales knowledge bank.
I have been writing about Trust in sales and business for many years; however, this year has seen a rise in my output on this topic, especially with the fallout from the Banking Royal Commission. Yet, trust is the heartbeat of business, sales and society.
Without this life force pumping vitality through our collective systems every day we start to wither and recoil. We become weak and anaemic. We close ourselves off and lose sight of what is real and important to our survival.
However, trust is much more present in our daily lives than the media and governments might have us believe.
Most of the people we rely upon to get us through our daily lives are strangers to us. The infrastructure for us to travel on and live within, the clothes we wear, the food we eat, rely upon the endeavour of strangers for the most part, and we trust that they are doing the right thing. And for the most part people are. It is heartening and comforting if we lend our attention to this fact.
Yet, when the things we are meant to trust fail, like banking institutions -i.e. the fallout from the Banking Royal Commission-, we feel betrayed, let down, angry and confused. We start to question what is true and what is not. We become wary, cautious, and more anxious, especially about the intentions of others.
As cited in the Australian Financial Review article this week:
‘Former ANZ CEO John McFarlane calls for rethink of banking philosophy… he has called for a shift in corporate philosophy away from the focus on making money to making a contribution to society. In an essay about long-term sustainable value, McFarlane admits that as a banker, “today I am ashamed of the reputation of our banks”.
“I joined the industry over forty years ago where the bank manager was the doyen of the community,” he says. “Not so today. We must return to the philosophy that banking is a profession as well as a business, and that contribution rather than reward is its centre of gravity.”
Short-termism, adherence to higher and higher shareholder returns, win-at-all-costs hyper aggressive greed based ‘Bro’ cultures, and affluence creation as a sole purpose in of itself, are all factors that breach trust and bring organisations to their knees with the likelihood of customers, members, patrons, patients, shareholders and employees leaving in droves.
When our trust is breached by individuals or organisations, it is very hard to come back to that entity and feel completely safe. Our radar is heightened and alert. It’s hard to relax when we are not sure of their intentions and we stay wary, looking for signs of more danger. We end up questioning the motives of others with good reason because if we don’t, we may become their victims.
This is the dance of all human relationships. I confess I start out with trust as the default setting; however, I know of others who start the other way around. Wherever we start, we are working with the tension between trust and mistrust. We look for signals that help us navigate our relationships and whether we can feel safe with people or not. This is true internally within organisations and teams, with customers, and people in general.
Hard earned over many years, trust can evaporate overnight.
Trust Building Elements
So what do we need to do to develop, encourage, support and sustain trust based relationships in sales, business and society?
Here is a list of Trust Building Elements for your consideration:
Expertise:have the ability, knowledge and resources to meet customers’ realistic expectations in our areas of expertise
Dependability:do what we say we will do. Make promises we can keep and keep the promises we make. Be reliable. Deliver quality.
Candour:cultivate the quality of being open and honest. Frankness.
Customer orientation: Place as much emphasis on our customers’ interests as our own.
Compatibility:create a common connection. Find something in common. Be caring.
Clarity:be clear about what you can and cannot do for people. How you help them.
Collaboration & Cooperation:work together, with each other. Aim for win:win relationships. Sort out differences in a respectful manner. Find common ground to work from.
Consistency:set clear guidelines, expectations and accountabilities and stick to them.
Communication:maintain frequent, open and meaningful communications. No confusing terms, tricky jargon or asterisks. Communicate any changes in a timely manner to give people a chance to adapt, and act if desired.
Principles & Purpose:design and lead a culture around principles, not rules. Define a higher purpose that supports mutually beneficial, fair and sustainable long term practices, values and outcomes.