Will the sun keep shining?

Will the sun keep shining?


Summer rolls on and the weather has been generally pretty pleasant. It brings its own challenges for us at TM training & development, particularly running training courses in rooms without air conditioning, but we mustn't grumble - after all, it won't be long until we are moaning about the cold.
 
But what about the climate within the property market? We all know the old saying "Make hay while the sun shines"...but what if it stops shining? There is strong anecdotal evidence that things are becoming tougher. A reduction in applicants registering, a fall in asking prices, not quite the stampede towards new instructions that we witnessed in the Spring...
 
This edition of our newsletter assumes that the second half of 2014 will not be as bright as the first. Astute agents are already gearing up for changing conditions - we have seen a significant increase in demand for our selling and negotiation courses.
 
Whatever happens during the rest of the year, enjoy the newsletter and we hope you will find the suggestions for improving your business useful in the coming months.



Time for change?

The impact of MMR and introduction of stricter lending criteria, coupled with a change of message in much of the media, are leading to lower applicant numbers and a noticeable shift in the key “supply and demand” balance.

 Two consecutive months of falling asking prices in London make for an interesting barometer too, particularly if you believe in “the ripple effect”.

 Dramatic though it may sound, “Adapt or Die” needs to be the company mantra. “Old market” habits may not generate sufficient business in changed conditions, but although they must be reviewed, habits are notoriously difficult to break.

 The first step to take is to review the working processes in place for your listing and selling operations and assess your team’s effectiveness at each stage of these processes.

 The listing operation comprises six key stages to focus on – generating appointments, booking appointments, preparation for the valuation, the valuation appointment itself, follow up and finally vendor management.

 Survival partly depends on seizing the lion’s share of good quality available stock and to ensure you are an appropriate choice of agent for local vendors. How effective is your team at generating appointments? Leaflets, letters, wanted ads on your website, in the newspaper and window, diligent levels of contact with local “own-to-sell” applicants and running chainbuilding and homeswap registers have all led to an increase in valuations elsewhere.

 Some agents are not experiencing a reduction in valuations so the second stage of the process – booking appointments - becomes their initial priority. When valuation enquiries are taken, are the staff handling that stage in an exceptional manner and being seen as different from your competitors – have they been trained in building real rapport with these potential clients by establishing their true underlying reason for move and prioritising the quality appointments according to motivation and saleability? Do they know how to control the timing of the valuation in your favour and ensure your valuer meets decision makers? Do they book the appointment in such an exceptional manner that the client thinks “I needn’t talk to any other agent about my move”?

 The other stages of the listing operation – including the appointment itself - all play a part in your success and merit an overhaul if you are falling short of an exceptional standard. Have you accompanied your valuers on appointments and coached them on their weaknesses?

 Many agents recognise the necessity to increase fees, but such ambition will only be realised by being seen as different from your competitors. The good news is that behavioural difference costs no money – just energy and effort.

 The crucial stage of following up valuation appointments is always one which can be improved. Keeping in touch makes a massive difference to success. Agents who plan and implement a diligent follow up system will inevitably win more market share.

 The final stage of the listing operation – vendor management – is absolutely critical to success. What is the system and standard of ongoing client care and contact? Have the staff been trained how to persuade vendors to improve the saleability of the instruction? Senior staff visiting these clients has a far greater success rate than a sporadic telephone call from an inexperienced employee carrying out a task in which they have little expertise or confidence.

 As far as the selling operation is concerned, again there are six processes that must be reviewed. Knowledge/preparation, creating the right first impression, accurate applicant qualification, matching/benefit selling, gaining commitment, obtaining/negotiating offers – effectiveness in all these disciplines is critical. Yet our mystery shopper exercises reveal that many “negotiators” do not warrant that job title as they merely fulfil the role of polite dispensers of information and then hope that something will happen!

 What are your front line staff’s sales habits? One estate agency branch upon whom we conducted a mystery shopper exercise has texted and emailed the applicant in excess of twenty times to advise of new instructions but not made a single phone call to them. A glaring example of an “old market” habit…I fear for that company’s existence if that habit is not changed.

 Are the team highly skilled at identifying the “make you money” customers through higher level questioning skills? Have they been given support and guidance on maximising income streams through mortgage, conveyancing and survey referrals?

 An objective review of the selling and listing processes coupled with the necessary resultant coaching and training will dramatically improve the chances of winning an increased percentage of available instructions and sales. The role of managers, directors and owners must include a significant slice of time to coach the teams towards exceptional performance – good is no longer good enough. One key question to ask yourself is how much money you are spending on servicing unmotivated vendors and applicants compared to improving the skills of your staff?

 If market conditions do toughen, many estate agents may be about to be entering a battle but are failing to equip the troops for the fight.



2014 Tour Dates

Thursday 25th September in Coventry

Winning Quality Instructions  (morning session)

For sales and lettings valuers, this course covers things an exceptional valuer needs to do before, during and after an appointment to win the business at the right price and on the right terms. The key objectives are improving conversion rates, securing appropriate asking prices and maximising fees. It has received amazing feedback and positively influenced the performance of all who have attended it.

And

Increasing Market Share of Instructions and Sales (afternoon session)

Halfday course to cover how to get through more doors, be the agent of choice in your area, differentiate yourselves from other agents, retain clients, create raving fans of your business. With stock the key to success, this course is worth its weight in gold!

The trainers will be Julian O'Dell and Peter Chapman

We look forward to seeing you!

(There are only a limited number of spaces available.)


 Each session costs &99 plus VAT per delegate or you can book a full day at a cost of &170 plus Vat per delegate to include lunch.

________________

Tuesday 28th October in Manchester

Excellence in Client Care (morning session)

With client loyalty and trust the absolute key to success in agency, this fantastic halfday session shows how to win and retain your clients, thereby driving down withdrawal rates and increasing income. Suitable for any staff who are responsible for communication with vendors and landlords. 

And

Selling in a Tougher Market (afternoon session)

For any staff who are responsible for dealing with applicants, securing viewings and offers, and maximising business opportunities in challenging market conditions. This course shows how to raise the bar in terms of selling skills and techniques and has proven a resounding success.

 Each session costs &99 plus VAT per delegate or you can book a full day at a cost of &170 plus Vat per delegate to include lunch.


To book or for more information contact us on 01480 405583, email us at admin@tm-traininganddevelopment.co.uk or visit our website http://www.tmtraininganddevelopment.co.uk/online-booking.php

 



I was only taking orders…

Estate agents often experience a decrease in the number of new applicants registering during the Summer and thus a potential reduction in agreed sales, leading to the need for a spectacular Autumn to redress the balance.

Most practitioners recognise that simple “order taking” by staff when dealing with applicants was good enough in a buoyant selling market as buyers were beating a path to their door to snap properties up. In a cooler climate, skills have to be sharpened for survival, and many companies have been slow to do so in the past, leading to a significant number struggling to reach targets.

 The Mystery Shopper exercises we carry out are enlightening often for the wrong reasons. The following is a direct transcript of a telephone conversation between a hot applicant and an estate agent which took place recently.

 “Good Morning (Company Name Given)”

“Hi. I wonder if you could send me some details of flats up to &200,000 please?”

“No problem. Your name is Sir?”

 Name and address given

 “Flats up to &200,000 yeah?”

“Yes.”

“No problem at all. I’ll get details in the post.”

“Thank you very much.”

“Take care.”

“Bye.”

“Bye Bye.”

 It is unlikely that this negotiator had woken up that morning and decided to go to work to do their job deliberately badly, however one could be forgiven for concluding that that is what happened.

 Had this been a real applicant, what a terrible way to be dealt with! The negotiator failed to give their name at any point during the conversation making it all rather cold and impersonal. No interest was shown in the customer as a human being. No contact details were requested guaranteeing no telephone follow up was possible. Nothing was established as to their reason for move, timescales, position of their own property, mortgage situation or property requirements.

 As it happens, the applicant’s brief was that he was ready, willing and able to buy within a very short timescale due to a job move to the area. He had no property to sell. He was likely to visit the area within the next three days to start viewing and probably to make a buying decision immediately. He would have welcomed another mortgage quote and would have been interested in being referred to the Lettings department in case he failed to find somewhere to buy quickly enough. In short, this applicant was as good as they get, and yet no business resulted from this encounter.

 For those proprietors and directors reading this, can you be certain that your staff are not guilty of such shortcomings? Granted, this was only a Mystery Shopper, but the agent did not know that!

 Imagine this person as a real applicant…how would he have felt about the service received? Consider the context that he subsequently phoned other agents, as he surely would, and received better treatment more appropriate to his circumstances.

 Another agent might have engaged him in a longer conversation and quickly discovered what a fantastic prospect he actually was. Simply by establishing a few key elements of information, it would become clear that he should receive V.I.P. treatment.

 “How soon do you need to have moved by?”, “How are you getting on with your own property?” and “When are you next in the area to view?” are questions that would have painted an interesting picture.

 “Describe your ideal home to me…” offers the applicant the chance to wax lyrical about what is important to them in their new property and gives the negotiator an idea of which available properties may be most suitable.

 An immediate match could be done to see what is appropriate and viewings might be suggested and arranged. Associated services such as mortgages, conveyancing or lettings could also be offered.

 Details could be emailed or even hand delivered if it was a precious local property-to-sell customer. This would also mean that properties on with the agent in question and a competitor or two would be received and potentially viewed through this agent first.

 Finally, a follow up call to check the safe receipt of those details and to check suitability and desired viewings would ensure a great start to the applicant’s interaction with the agent. This must increase the likelihood that he will pay a visit to the agent in question upon arriving in the area in the near future, prior to seeing the local competitors.

 In the case of the call detailed earlier in this article, it is doubtful that the agent would have sold this applicant a property. In fact, the only subsequent dealings with the customer would probably be when he phoned in to be taking off the mailing list due to finding a property elsewhere.



Can you manage?

Many lettings agencies focus on “doing deals” and quick income rather than building their business and protecting their future through increasing the number of managed properties. In truth, the regular income gained from an extensive portfolio of managed properties ought to be regarded as the bedrock of such operations.

Some sales agents have started up a lettings function in recent years to help support  an ailing sales business, however many of these have chosen the “let only” route as a management operation is beyond their capabilities or means, or simply because they are looking for a “quick fix” increase in income that “let only” deals can provide.

Ultimately, a steadily growing reliable income stream from managed properties provides the stability and profitability that safeguard a business over the longer term. This is an objective that takes time to achieve although the adoption of “best practice” principles will accelerate the process.

One key element to success is to ensure your management service stands out and offers genuine differences from that offered by your competition.

This could include greater frequency and quality of routine inspections, perhaps to include a detailed follow up report with photographic evidence of ongoing condition. Offering online access for landlords to keep up to date with progress on the letting or management of their property has been very well received by clients of firms who have set up such a facility. The assignment of a personal property management specialist to oversee all aspects relating to their property, a robust rent guarantee scheme, an organised accounting process that pays the landlord swiftly and accurately and a smooth checkout process that minimises void periods will all prove to be instruction winners.

Detailed record keeping to prove your track record on landlord and tenant retention, and success stories of resolved issues, carry considerable weight, as do testimonials from other clients.

Having established your clear USPs, the next stage is to assess how effectively these are being promoted.

The ability to “sell” management as a concept to potential landlords varies massively amongst the lettings firms for whom we are invited to carry out consultancy work and training. It is an area that we concentrate on very early in the business development process, and, once the skills and principles are addressed, there is always a significant impact on upping the number of managed properties.

It is interesting to ask frontline lettings staff, who are usually the ones responsible for convincing landlords to go for a fully managed service, exactly what the complete range of benefits that management will mean. There are several that staff do not regularly promote.

Aside from the obvious avoidance of hassle that a managed landlord will experience, assuming the agent has a 24 hour helpline for the tenant to call in the case of emergencies, (any landlord hinting that they are intending to self manage should be asked the question “What is the best number for the tenant to reach you on at 1.00 or 2.00am?” – it often makes them think again!) there are clear financial benefits which often slip under the radar.

Data that some of my lettings agent client firms have shared with me in recent years show that the average length of tenancy is greater for managed properties compared to unmanaged. Furthermore, any void periods tend to be shorter, potentially because a proportion of tenants specifically request to view only managed properties for the likely ease of problem-solving, therefore leading to a higher level of interest and demand. This may also account for the fact that there is evidence to suggest that rents achieved on managed units are more favourable compared to unmanaged.

A landlord choosing to self-manage will miss out on such advantages, and later on potentially be forced to negotiate the minefields of appropriate handling/registering of deposits and taking the correct legal steps to deal with a defaulting tenant.

As a landlord myself, I genuinely believe that opting for a “tenant find” service is highly likely to be a false economy. It is the job of the lettings agent to persuade the landlord clients of that at the outset, and for the property management department to convince them that they have made the right choice.



Thought for the day...

"Progress is impossible without change, and those who cannot change their minds cannot change anything." George Bernard Shaw