How can you truly trust someone when you can’t see their eyes?
If any business is a people business, it is real estate. Real estate auctions expert or not, an agent depends on networking to build their client roster and a solid referral network, over time. The first order of business is to build familiarity and trust with people we meet, and work to expand that pool every day. The first step is to genuinely connect with potential clients and come across as honest human beings they can trust. We must ‘connect’ with them.
Here is a question every agent needs to ask themselves.
How can I effectively connect with people when the first thing I do when I slide out of my house is to cover my most powerful asset for building trust and connect with people, my eyes?
We grab the darkest set of sunglasses we can find and the store shelf, and as long as we think we look cool in them, we slap them on our faces and walk the streets all day forgetting about the opportunities we are missing along the way. Every single day. Where did the good old days where everyone made eye contact and greeted other passers by? What would you be able to do if you were able to make eye contact with ten additional people each day whether on the street, at the neighborhood store or on the restaurant patio? How much more effective would your meetings be with prospective clients if you remove the mask off off your eyes when you meet with them?
If on the odd occasion you must don glasses during a showing outdoors on a very sunny day, it is best to do so after excusing yourself and preferably after you building a relatively reliable level of trust with the prospect.
The next time you reach for the Zoro mask, no matter how expensive or cool it is, ask yourself whether it is really helping, or hindering your growth as a real estate professional. If stacking the odds in your favour means suffering a bit of a glare every once in a while, that just may be the compromise you need to edge out your competition.
Not long ago, many markets were literally frozen. Today we went to the opposite extreme. Agents and investors in a number of markets are complaining from low inventory, with many having closed over one hundred deals last year. A good sign if banks are able to continue to manage the inflow of foreclosures into the market. While inventory control and Federal Reserve money printing policies have directly led to a demand-based market within an inflationary environment that further helped to boost prices, the reality is that agents and investors are now looking for ways to manage multiple offers more efficiently. Irrespective of market conditions, allowing offers to fall through the cracks has deep implications on sellers, agents and buyers, and must be effectively addressed.
One of the emerging trends in real estate is fully transparent public real estate auctions. The idea of ‘auction’ is making its way into agent and investor plans, slowly but surely. But if the statistics offer any reliable indication, real estate auctions will become significantly more prominent over the next 2-3 years. In fact, NAR (National Association of REALTORS®) projects that the auction market will consist of one of every real estate transaction, by 2014-15.
As in any industry, there are visionaries and pioneers who embrace new technologies and adopt new ways to manage and grow their businesses. Automating offer management is now emerging as an effective means for real estate agents and real estate investors to manage incoming offers and counter offers while maximizing property value at the same time.
The idea and execution are both extremely simple:
1- Set a start and end date to auction a property online. Traditional on location auctions tend to be relatively cumbersome, resource intensive and expensive. New 100% online auction platforms are replacing the old model and are entirely free of charge.
2- Pre-market the auction to investors, brokers, agents, consumers and anyone you would usually reach out to through your usual marketing channels, and direct them to the online auction page. Include the auction open and expiry dates and times. Use email, post cards, your website and social media channels to create excitement around the auction, and include the link to the auction page.
3- Watch offers come in and get outranked automatically by other interested buyers, through your online dashboard and at your convenience.
4- Contact the buyer with the highest bid, at auction expiry (the auction end date and time), to begin the legal paperwork.
Along the way, advanced platforms such as ListedBy should enable you to view bidder profiles and contact information, so you may connect with them directly if you wish to flesh out the more likely buyers, much like you would in a typical, non auction environment.
Letting technology take in bids, update bidders and automatically increase bids based on preset limits each interested buyer inputs into the system is a surefire way to manage hundreds of offers simultaneously, especially important in a hot market. So you can seal that crack once and for all, and maximize sales and property value.
If anyone in the industry knows how to reach top producer status and hold it consistently, it’s RE/MAX REALTOR® and success coach Christy Crouch. We caught up with Christy to discover her top secret.
LB: Christy, many real estate professionals can and do benefit greatly from your experience. If you were to share your number one secret to success, what would that be?
R: Treating it like a business, as if you own the company and you are the CEO of your company. You have to make choices and behave like the CEO of a major corporation would. Consistency is key. The consistency of what you do day after day in this business determines the consistency of your income month after month.
LB: What is/are the main challenge(s) that you face in pushing through with this advice in your own business. How do you overcome them?
R: Schedule and time management. I have two kids under the age of 13 and juggling it all can be challenging at times. To overcome it I follow a daily schedule. I plan each month out ahead of time with what days I’m working, what activities are going on and work my personal and business life together. I ask myself daily… is what I’m doing today going to benefit me, my family, my business, or contribute to someone else? If the answer is no, I generally shift to a more productive action. On some level it’s simply a choice and you have to Just Do It every single day like the Nike ad says.
LB: What is the main downside for not applying this principle?
R: You’ll never become a top producing agent without treating it like a business. You may sell a lot of houses one year and not the next. You’ll experience inconsistency, overwhelm, burnout and breakdown much more often.
LB: How can listing or buying property using free online real estate auctions or ‘Best Offer’ technology on ListedBy or other platforms impact your business?
R: I believe the more exposure you can have for yourself, your business, and especially your listings, the better off you’ll be. The Internet puts the world at our fingertips and I think we should take full advantage of that.
LB: Anything else you would like to share?
R: I am just like anyone else. If I can do it, they can do it. It’s all about the choices we make every single day. Choose to win and you will!
LB: Once again, thank you very much for your contribution.
About Christy Crouch: Christy Crouch is the co-founder of You’re The Difference Sales & Life Coaching (www.yourethedifference.com), coauthor of the highly acclaimed real estate objection handler book, Now What Do I Say? Christy is an active agent in Virginia, has participated in closing thousands of transactions in her career, and was inducted in the RE/MAX Hall of Fame for her production. Christy is in the top 2.3% of her marketplace. Her goal is to share what she’s learned with other agents to support them in having a highly successful real estate sales business while having a happy and balanced life.
We’ve spoken quite a bit recently about the restrictive and compromising nature of the traditional real estate auction revenue model. Auctioneers generate their revenue mainly through a brokerage fee referred to as a Buyer’s Premium. This fee, typically between 2 and 10 percent of the value of the property, is added to the final purchasing price that a buyer must pay to complete their purchase.
Let’s say you or your client, if you are a REALTOR®, are interested in California residential real estate auctions and you find an opportunity to bid on a $100,000 house (starting bid). If you end up winning the auction at $105,000, you would be required to pay up to $10,500 on top of the final winning bid price. That’s $10,500 dollars more than you intended to pay for the actual house, and that anyone would naturally prefer to put towards closing costs, renovations, or trips to Hawaii for the next couple of years.
Three issues emerge from this typical scenario that, for now, still occurs every day across America:
1. Buyer Capacity Is Compromised – Technically, what would have happened under the $105,000 home auction example, if you had lost the auction to another buyer, is that you could have had another $10,500 to put towards winning the property. But because you knew you had to pay a ‘Buyer’s Premium/Penalty’ on top of the final winning bid, you would have had to stop your bids at $105,000, as your total payment at that price level would have been $120,000 (price of the house plus $10,500 for the auctioneer)!
2. Home Value and Home Seller Are Compromised – What this example highlights is the loss the home seller incurs under current Buyer Premium auction models. Instead of capitalizing on an extra $10,500 that bidders could use towards the purchase of your home, that same money has to go to the auction house. This caps the actual property value at $105,000 instead of a possible $120,000 ($105,000 + another $10,500 that has to go towards the Buyer’s Premium fee).
3. Slower Selling Environment/Market – The higher the price, the fewer the pool of buyers who can afford to buy a specific property. As simple as that. With an extra $10,500 taken out of play to pay for the auctioneer’s fees, fewer buyers are available to participate in the auction. More buyers directly lends to a more active, faster moving market where sellers can exit and can go on to purchase their next home more quickly, and where overall market inventory can turn at a healthier pace.
An entirely free model where neither buyer nor seller pay any fees to buy or sell at auction is packed with benefits for everyone involved, and is a recipe for a more efficient market where everyone wins:
- More money available to buyers to put towards a property;
- Optimized property value and more money for the seller; and,
- A healthier, faster moving market.
We’re pleased to announce the release of a new consumer handbook on real estate auctions, ListedBy – Real Estate Auction Primer for Consumers.
One of the terminologies explained in the booklet, which will be available for download right here within this blog post next week, is Transparency.
Transparency is one of the key advantages of real estate auctions, specifically online real estate auctions. That’s when bidders can see each others’ bids at any time, and can look up each others’ information, such as account profiles. Much like on LinkedIn and other social networks.
This kind of transparency gives everyone a greater sense of trust and confidence in the process, equal chance, and optimizes a property’s market value. New platforms such as ListedBy.com allow everyone to view other’s bids and member profiles including any ratings, recommendations or comments.
The guide also emphasizes the importance for consumers to engage an experienced REALTOR® when considering selling or buying a home through auction.
Click to DOWNLOAD ListedBy – Real Estate Auction Primer for Consumers.
Meanwhile here is the full News Release capturing the content of the booklet:
ListedBy Releases Real Estate Auction Guide for Consumers
Downloadable handbook outlines and explains basic auction terminology, strategies and ‘must-know’ guidelines for home buyers and sellers
NAPA, Calif. – November 30, 2012 – ListedBy (www.ListedBy.com), the first free online real estate marketplace and social network with live bidding auction and ‘Best Offer’ functionality has released ListedBy – Real Estate Auction Primer for Consumers, a ‘must-know’ guide for anyone looking to buy or sell real estate through auction.
“As the auction market gains traction, important terminologies and factors are a must for both buyers and sellers,” said Stephan Piscano, CEO and Co-Founder, ListedBy. “ListedBy’s model changes the auction practice almost entirely and adds new dimensions even experienced real estate professionals can greatly benefit from.”
ListedBy – Real Estate Auction Primer for Consumers will be available for download, free of charge, in the Knowledge Centre on ListedBy Blog, starting December 4, 2012. Consumers considering auctioning their home or purchasing a property at auction can also tap expert advice on the ListedBy Member Forum.
ListedBy – Real Estate Auction Primer for Consumers
Basic Terminology and Strategies
1. Auction – The term auction is derived from the Latin ‘augeō’, which means ‘I increase’ or ‘I augment’. It is a process of buying and selling goods or services by offering them up for bid, taking bids, and then selling the item to the highest bidder at a pre-set set auction expiry date and time.
2. English Auction – Is an auction where the price is driven up by buyers and where the highest bidder wins, at auction expiry.
3. Dutch Auction – A process where the starting price of an asset begins higher and scales down until the offer meets a bid.
4. Reserve Auction – A ‘Reserve Auction’ sets a minimum price below which the seller is not obliged to sell the property at the expiry of the auction. As a home seller, use this strategy to secure an absolute price below which you are not ready to sell, and to advise bidders that bids must go higher for an acceptable agreement to be reached.
5. No Reserve Auction – A ‘No Reserve’ auction, also known as an Absolute Auction, legally binds the seller to release the property to the highest bidder above the set starting bid price. This strategy is usually used to create early excitement around an attractive, lower but acceptable price. The approach can drive a bidding competition that can result in a final sale price higher than originally expected by the seller.
6. Buy It Now – By placing a bid under a Buy It Now price option set by the seller, the bidder instantly wins the auction and both seller and buyer are obligated to transact at the set price. Leverage Buy It Now to avoid entering into a competitive bidding scenario and to secure and close on the property quickly.
7. Buyer’s Premium – A traditional practice that new business models such as ListedBy.com are eliminating. Also referred to as a Buyer’s Penalty, or the fee that a winning bidder must pay over and above the price of the subject property. The premium is typically between two and ten percent of the asset value.
8. Open Outcry – Unlike sealed bid auctions, ‘open outcry’ auctions are ‘open’ or ‘fully transparent.’ The identity of all bidders is disclosed to each other during an open outcry.
9. Auction Expiry – An auction has a start date and time, and a close ‘expiry’ date and time after which new bids are no longer accepted. In cases where a last minute bid comes in just prior to the expiry, certain auctioneer rules may include a short extension, to give former bidders a chance to counter the late coming bid.
1. Fees and charges – New, advertising and service driven business models are doing away with all fees associated with buying or selling property at auction. As a seller, look for auctioning your property through a provider or platform that does not charge any fees or commissions. As a buyer, look for auction venues that do not charge any Buyer Premium or penalty.
2. Transparency – Sealed bids may have some advantages in certain cases. However, in buying or selling your home, it is important to first consider a fully transparent environment where everyone gets to see who is bidding and how much. Transparency gives everyone a greater sense of trust and confidence in the process, equal chance, and optimizes a property’s market value. New platforms such as ListedBy.com allow everyone to view each other’s bids and member profiles including any ratings, recommendations or comments.
3. Online Auctions – New, entirely Web-based auction platforms and service providers offer a simpler, quicker and more efficient avenue for buyers and sellers to engage in auction. An online avenue also does away with the added effort, inconvenience, resources and expenses needed to organize and run a physical, on-location auction.
4. Engage a REALTOR® – While buying and selling at auction online is relatively easy, look to engage an experienced representative who understands real estate marketing, knows the area, the auction process and various strategies that can be used to maximize your property value or clinch you a better deal, if you are a buyer. A local REALTOR® who also has experience in online auctions can bring significant advantage to the process. The Member Directory on ListedBy lists agents from across the U.S. and can be a great place to begin your research.
Benefits of Online Auction for Buyers
· Knowledge that the property will sell at auction expiry.
· Knowledge of who you are bidding against and where the bids are at any point in time. A fair play environment.
· Ability to participate free of charge and from anywhere, anytime.
· Ability to conveniently view and bid on multiple properties.
· No Buyer Premiums means additional funds to put towards a desired property.
· Significantly cuts down price negotiations time typically consumed in traditional buying and selling.
Benefits of Online Auction for Sellers
· Expose your property to cash-ready, pre-qualified buyers.
· Let the market reflect the right value of your property.
· Create excitement around the sale of your property.
· Certainty that the property will sell and by when.
· A way to potentially sell your property more quickly.
· Create competition among buyers.
· Less back and forth negotiations lends for an overall faster, easier process.
- ListedBy on LinkedIn and Twitter @ListedByYou
The auction segment is growing rapidly and, more and more REALTORS® are moving to learn about auctions to add to their marketing toolkit and differentiating expertise. One of the biggest shifts that ListedBy is driving in the real estate auctions market segment is the move to an entirely Web-based process. The benefits are huge and in many cases obvious, including efficiency, speed and lower costs for everyone involved.
Another major change is the revenue model. While traditional auctions usually involve registration/participation fees and, the biggie, up to 10 percent of the asset value in what is referred to as a Buyer’s Premium, ListedBy is doing away with ALL these costs. The result is more money in buyer pockets to go towards making a deal happen. For the seller, it means wider participation and optimal market value, for reasons too many to cover in this post.
If not the auction part of ListedBy, industry professionals are highly interested in the platform’s online offer submission technology, another major advance ListedBy is bringing to the real estate transaction that we will also discuss here in the future.
We look forward to engaging with you here on the blog as well as in the ListedBy (LB Social™) Forum. If there are any specific issues or subjects you’d like us to tackle, please post your ideas and thoughts in the Comments area below, or send me an email to email@example.com.
Please drop by often for corporate updates and news, special feature property listings and education on the world of auctions, or to view and participate in on-going discussions.
Meanwhile here is the full announcement about the launch of ListedBy Blog that was issued on the Wire earlier today:
Online Real Estate Auctions Platform ListedBy Launches Blog
Dynamic stage to deliver timely corporate news, ListedBy user communication and online real estate auction education
ListedBy (www.ListedBy.com), the first free online real estate marketplace and social network with integrated live bidding auction and ‘Best Offer’ functionality today announced ListedBy Blog, a dynamic environment the company will use to deliver corporate and product news, featured listings, ListedBy member and user information, education materials, articles, event schedules and market reports.
“I am excited about how the blog feature on our site will allow us to not only broaden our ever growing base, but also gives us yet another way to keep direct contact with our very loyal and active user base on the site,” said Stephan Piscano, CEO and Co-Founder, ListedBy.
ListedBy Blog is now live and features a number of real estate marketing and auction related educational articles, success tips, and answers to frequently asked questions.
Membership in ListedBy continues to increase at a rapid pace with thousands of new accounts added over the past month and approximately 4000 industry professionals now participating on the site’s LinkedIn Group.
- Media and industry analyst briefings: firstname.lastname@example.org
o Leaders and Laggers – How Industry Pioneers are Using Online Real Estate Auctions to Distance Themselves
o Online Real Estate Auctions – When to Dive and When to Skip
Online Real Estate Auctions – ListedBy KNOWLEDGE CENTRE – How Chicago’s REALTOR® Cassandra Barber Achieves Consistent Success
Online real estate auctions marketplace ListedBy recently caught up with Cassandra Barber, GRI, SFR to find out the main secret behind her success. Here is our interview:
LB: Thank you very much for your time. We know that many ListedBy. com members and others will benefit greatly from your experience. If you were to share your number one secret to success, what would that be?
R: There is not a secret to my success – just a lot of hard work.
LB: What is/are the main challenge(s) that you face in pushing through with this advice in your own business? How do you overcome them?
R: Staying focused and not allowing distractions to keep me from my goals. Real Estate is an industry that if you allow the “noise” of the next best practice to distract you, you will forever be re-inventing yourself.
When you visualize where you want to be in your business, answer the questions what is it going to take to accomplish that, and stay focused on those answers you will realize your goals.
LB: What is the main downside for not applying this principle?
R: The biggest downside is not reaching your full potential by not accomplishing the goals that you set for your business.
LB: How can listing or buying property using free online real estate auctions or ‘Best Offer’ technology on ListedBy or other platforms impact
R: I realized auctions provide another tool that REALTORS can offer their clients and of course every circumstance will be different. The market dictates that we must think outside the box and auctions provide an avenue for quick and productive results.
LB: Anything else you would like to share?
R: Auctions may not be for everyone or every home, but agents should consider auctions as a valuable option and tool. The National Assoc. of REALTORS convention this year featured a session on auctions and for me that speaks volume to the value that auctions will have in our market place now and in the future.
LB: Once again, thank you very much for your contribution.
About REA: RealEstateAuctions.com (REA) is a leader in U.S. real estate auction sales. Our team of auction specialists has closed more than 8,000 sales of all types all over the country with a huge list of client partners, including HUD, FDIC, Fannie Mae, Freddie Mac, pension funds and a myriad of other corporations, institutions, developers and private owners located
throughout the U.S.
HC’s Ryan Stewman wrote a blog post today along with a detailed video analyzing the key aspects of ListedBy.com. Beside the fact that ListedBy is indeed gaining rapid traction amongst real estate professionals and investors, what was interesting is that Stewman honed in on the LinkedIn-like social networking system built in to the platform.
“Anytime a new technology comes out, a few hardworking people who rise to the challenge, can find gold in it. I believe ListedBy.com is gold.”
One of the main challenges that face the real estate industry today is to figure out how to use social media effectively in business. Many real estate professionals wonder how much time they should spend social networking, while others struggle to come up with effective content to keep that elusive engine going. Fair challenges, among many many more.
By integrating the LB Social™ system into the overall ListedBy.com dashboard and tool set, REALTORS, investors and consumers can effect social interactions that are directly linked to the business at hand. With little effort. From creating a detailed professional profile, researching and connecting with a local agent with a click, to building a regional or national REALTOR referral network, to inviting and adding personal email contacts from Outlook, Gmail and others with ease, it’s all there. What is left is for the user on ListedBy to realize that these tools are available to them, then use them to their advantage.
Stewman also discusses why agents should also look to lock in their zip codes in terms advertising on the site, as with any new and fast growing site, getting in early has its advantages. Both from a lower cost point of view, and from an early market positioning perspective.
For those new to the site, ListedBy is the first free real estate marketplace and social network with integrated live auction and ‘Submit Offer’ functionality. Basically, a real estate auction site where users register to use the site entirely free of charge, then list properties for sale either through the auction option, a Best Offer / Buy It Now option, or a straight forward Classified option. All the options are free.
In all cases, the listing agent/poster is featured as the primary contact next to their listing, with all their contact information and hyperlinks back to their own website, to connect them with potential buyers as quickly as possible. No middlemen in between overshadowing the listing agent on their own listing page.
While traditional and longstanding auction sites and organizations may not like ListedBy’s business model (they charge 1-10% buyer’s premium on every property sold), ListedBy has done away entirely with ALL fees associated with auction. No registration fees, and no buyer premiums. ListedBy’s revenue model is mainly advertising based.
Like Stewman said in his article, “Anytime a new technology comes out, a few hardworking people who rise to the challenge, can find gold in it. I believe ListedBy.com is gold.”
One of our participants on the ListedBy.com LinkeIn Group today asked us whether NAR projections for real estate auctions reaching 1 out of every 5 properties sold by 2014-15 covers specific geographies or are regionalized. As well, whether the majority of the auctions would be online or onsite.
Here is our response, to help our readers here to have convenient access to it.
We suspect that the majority include online + on location, because that’s the traditional model used by auction organizations thus far. The numbers cover the entire US. New models like ListedBy.com are turning the traditional model upside down by doing three key things:
1- 100% free. No fees for buyers nor sellers. Means more participation and more money to go towards the property instead of paying 2-8% buyer premiums.
2- 100% transparency. Everyone gets to see who is bidding and how much. Gives everyone equal chance and optimizes property market value.
3- All 100% online. Simpler, quicker, cheaper and more efficient for everyone involved.
Here is a link to a recent article we published on ListedBy.com that goes into a bit more detail.