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After an incredible period of real estate prosperity, right about now, you could be forgiven for thinking that real estate agents and business owners were being squeezed from all directions.
Inflation means everything costs more, staff expenses like superannuation are rising, a low unemployment rate means good people are hard to come by, and that aforementioned cost of living means great staff are hoping for a little more in their pay packet.
Of course, real estate isn’t the only industry experiencing this big squeeze.
Real estate customers are feeling it, too, meaning that good old fee conversation is likely to pop up a whole lot more in the coming months as the cost of living continues to bite and the huge property price gains of previous years become a thing of the past.
So how can you address the big squeeze?
Well, let’s break it down a little, starting with that age-old dilemma that is the fee conversation.
The fee conversation
As business owners, it’s pretty clear that now is not the time to be slashing your income by discounting fees.
More importantly, as has been said for years, when you are competing by lowering your fees, it’s simply a race to the bottom.
Instead, now is the time to be demonstrating your value as an agent who is an indispensable asset to your vendors.
In other words, it’s time to get crystal clear on the value you offer and how this benefits your customer.
So, what exactly is that value?
Quite simply, it’s saving them time and stress on the sale of their property courtesy of:
- Your market knowledge that allows for accurate pricing and the correct marketing of a property.
- A buyer database and the ability to match people from that database or other interested potential buyers with their home.
- Honest feedback to let them know how well a sales campaign is tracking and if or when it may need to be re-evaluated.
Addressing seller and buyer concerns
Part of showcasing that value involves addressing both buyer and seller concerns through great education about what exactly is going on in the market.
Not the national market, but their specific market — their street, their neighbourhood, their suburb and their town.
This education sets a solid foundation for the further conversations you might need to have to address any buyer and seller concerns.
It positions you as that market expert and the trusted authority who can cut through the noise to paint an accurate picture of what a property is worth and then connect a seller with a buyer with the least amount of hassle and stress.
And along the way, it’s building your brand.
Managing the skills shortage
On the flip side of the real estate business, there are some other potential challenges emerging, not least of which is the skills shortage.
With unemployment at a near-record low, great people can be hard to find. There’s also a good chance wages are about to start rising.
Meanwhile, the legacy of the pandemic means good team members, such as experienced property managers, are rethinking whether that job is for them. After all, it’s been a tough couple of years where PMs have been sandwiched between legislation, landlords and renters.
That means now is the time to get laser-focused on your company culture and what benefits your business offers your staff. It’s time to consider what support mechanisms you have in place to retain great team members and why people would want to work for you.
That said, there remains the challenge of attracting qualified and skilled personnel into the industry and specifically your business for a price that you can afford.
Is it time to rethink your business model?
All this begs the question, could now be the time to rethink your business model?
Is this the moment to look at centralising some of those back-of-house tasks or tapping into the power of a network who have skilled staff available to do the legwork on your behalf?
In the process, it could free you up to build your brand, focus on the customer moments that matter, and offer the real value that vendors and buyers seek.
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