How do you become the go-to agent in the competitive world of luxury real estate? Here are the six assets every luxury agent must master.
How do you thrive in today’s luxury market? Don’t miss Inman’s Luxury Connect, October 15-17, 2019, in Beverly Hills, California. Walk away with the marketing, technology and luxury intelligence to grow your business while expanding your referral network with built-in networking sessions. Join 500 of the most notable names in luxury real estate. Reserve your spot here.
I reside in an area called Orange County or “The O.C.” It’s a region in Southern California that serves as the center stage for several TV shows. It’s draped in designer cars, fashion, sun, surf, sand and some streets are even adorned with luxury real estate mansions.
For more than 50 years, I have called this part of the world my personal and professional home. Over that time, I have seen numerous changes in its culture and perception, which has left me with one thing I know for sure: If you are going to stand out in this luxurious part of the world, you need to be exceptional at what you do.
As a luxury agent with almost a billion dollars in sales, I am often asked how I created a sustainable livelihood in a niche market that some only dream of developing.
My answer is: “I do it differently than one does in the non-luxury market”
If you are someone interested in entering into the competitive luxury market, this article will outline what I believe are the six common characteristics required to be a luxury agent in today’s market. Master these six essentials, and you’ll make your mark and endure as a luxury agent.
What is the luxury market?
A luxury market is defined as the top 15 percent of all sold values within that market. For example, my niche luxury market of Newport Beach, California, starts at $4.3 million (15 percent of all sales are above $4.3 million as of August of 2019).
The city of Riverside, California’s luxury market, located 45 minutes inland, starts at $545,000.
This presents two common sense facts about luxury markets:
- No matter where in the U.S. you hang your license, a luxury market exists in your area
- No matter what area you practice real estate, there is extreme competition for that luxury market share
Becoming the go-to agent
How do you become the go-to agent for luxury real estate in your luxury market? Here are my six pearls of wisdom that help you open that golden gate.
1. Look the part
Allow me to start with the least, yet very important aspect of sales, which is appearance. I believe Zig Zigler said it best when he stated, “You cannot climb the ladder of success being dressed in a costume of failure.”
This means that as a luxury agent, look the part. Believe it or not, it doesn’t take much.
For example, some simple secrets include purchasing a new jacket or business suit at least twice a year and tailoring your jackets or clothes to fit as though they were meant just for you instead of off the sale rack.
Pay attention to the wrinkle factor of your clothing. Linen might be breathable, but it also looks like a hot mess the moment you sit down.
Always make sure your socks are new (if you wear socks, which I happen not to), your shoes are clean and your mani-pedi is fresh. Why? At all high-end showings, you will be shaking hands and likely removing your shoes when touring their prized possession.
Always, and I mean always, arrive in a clean and organized car, with your business card and marketing materials presented in an easy to exchange format. A bumbling disheveled agent does not exude confidence because, as every business mentor will teach you, a first impression makes lasting impressions.
2. Know your market
No clothing, grooming nor clean and organized automobile will make a bit of difference in being a top luxury agent if you cannot back up your image with your experience, knowledge and, most importantly, results.
Selling in the luxury market is so much more than pulling up comparables or placing properties in the MLS with hopes it will sell. (Hope, by the way, is not a strategy.)
In the luxury market, one must bring together a vast number of factors to extrapolate an appropriate list price to, in turn, give yourself the best chance of selling your luxury listing.
That vast list includes knowing:
Your market vulnerabilities
As a luxury agent, you need to know your market vulnerabilities. This means being aware of factors that will eventually influence your market, such as growing inventory not yet reported in the news, anticipated rate hikes or pending data that will impact your listing when it shows up as a comp and forces you to reduce your price.
Not all pending transactions are immediately reported to the MLS, so be vigilant to your market pulse.
To adjust, you need to know all the nuances in your market. You need to anticipate trends such as an increase in inventory and a decrease in demand.
You need to be well-read by studying all the trade magazines and financial media available. That means making Inman a part of your morning routine as you sip on your first few cups of coffee. This is important because even though real estate is local, it is still affected by global occurrences.
Understanding supply and demand is not only basic Economics 101, but it is also critical in evaluating your list price.
In the O.C. luxury market, for example, there is currently a market time of 569 days (August 2019). We have a 6 percent supply and only a 1 percent demand.
Based on these numbers, it is paramount that your initial list price is strong and that you are prepared to adjust accordingly within the first 90 days, so that your luxury property is not on the tail end of the 569 day cycle, or worse, on the expired list.
How to explain it all to clients
I know all of our clients believe they know more about valuation than we agents, and as much as I appreciate my clients’ input into valuation, I make sure my clients have all the pertinent information available so that, together, we can come up with a list price that will give us the best chance of success.
If you really want to go the extra mile, retain a luxury appraiser prior to list. This will give you a true market valuation based on tangible and intangible conditions.
What the home’s features are really worth
Know the property’s luxury features that command luxury prices such as high-end appliances, architectural features, natural resources used throughout, ocean or city views. What does your listing have that is special, unique or rare?
3. Invest in marketing
We are all familiar with the business saying, “You need to spend money to make money.” I mention that because this is the golden rule when it comes to creating your marketing budget.
Gone are the days when a four- to 16-page brochure was enough to sell a luxury home. Nowadays, savvy sellers and buyers expect a lot more, including:
- Social media presence: Today’s luxury market clients expect a comprehensive, professional social media campaign, featured on mature social media platforms that meet the target market of your buyer or seller. No, Snapchat is not a good match for a million-dollar client.
- Short films or creative videos: A visual presentation of a luxury home is no longer just a static photo. Search engines such as Google now prioritize video and push that content to feeds. Clients now want to showcase their homes on a video platform, which must be shot and edited by professionals, not on your smartphone selfie mode as you peruse through your listing.
- Virtual staging: Not every mansion is decorated properly, therefore, if you find that your listing is out of date or that money doesn’t buy the taste it takes to sell your listing, consider virtual staging. Virtual staging allows you to quickly change an out-of-date look to a Cape Cod or a contemporary home that will allow a buyer to better evaluate your listing for their lifestyle. Virtually staged photos are now allowed to be featured on the MLS as long as you provide a disclaimer. Virtual staging is not disruptive in cases where clients are still living in the property. Virtually staged photos can also be enlarged and placed on an easel for client walkthroughs, allowing prospective buyers to see the potential of the room they are viewing.
- Staged social events: One way to bring new traffic to your listing and make it an interactive experience is to create a sunset cocktail party or other social events for the who’s who in your area. There is nothing that makes a house more alive to a buyer than inviting them to experience your property with food, entertainment and fun. If people are enjoying themselves at your event, they will talk about it the next day, and you will get a great deal of mileage out of this by encouraging photos and sharing on social platforms.
4. Create luxury listing presentations
You only have one opportunity to make a good first impression. Therefore, if you are fortunate enough to be on a short list of agents being considered for a luxury listing, make sure your listing presentation speaks for your professionalism.
Here are a few pointers:
Make it professional
Without a doubt, make sure your listing presentation is professional, detailed and, most of all, current. The presentation should not only showcase your strengths and sales successes as an agent, local and international marketing platforms, but it also needs to dedicate some page space to the company you represent, as though you are the point-person because your company is also in the interview queue. Upon completion, both a digital and paper version of the customized presentation should be left with your client.
Commit to memory
Authenticity is a must, which means that when it comes to interacting with the client, know your presentation — and commit your material to memory. Rather than reading the pages like a schoolteacher teaching English, you instead confidently deliver your story, all while observing your client’s reaction so you can take pause on the areas they find enticing.
Know there’s strengths in numbers
I have been in this business for 30 years. Although I know my “stuff,” I never hesitate to ask some key members in my company to attend important presentations with me. That can include the chief marketing officer, who can explain to the clients all the resources available to them to market to potential homebuyers.
Or my personal favorite, the president of the company; which in my case is our owner, Gary Legrand. As the president of our company and a former uber-successful agent, he not only speaks our language and improves my chances of obtaining the listing, but his presence also shows the client that we as a company care from the top down.
Together, we show our real estate knowledge for the area as well as the power of the relationships our company has with high-net-worth individuals who can afford luxury listings.
5. Know the different personality types
In life, success and failure often comes down to effective communication. Each of us processes information differently, therefore, observe the personality of your clientele.
Assess who you are speaking with
When it comes to being heard, watch the communication style of your client, and then adapt to it. Meaning, if they are quiet communicators, communicate quietly. If they are colorful communicators, communicate colorfully. If they are direct communicators, communicate directly.
Learn to listen
Many problems in our industry arise because of our inability to listen. In a day and age where our attention span has dwindled to mere seconds, we are programmed to get our point across as quickly as possible.
To be an effective agent, however, you must learn the art of listening. This means: close your mouth, open your ears, and absorb the hopes, dreams, desires and needs of your luxury client.
I like to live by the words of educator Peter Drucker: “The most important thing in communication is hearing what isn’t said.”
6. Build relationships
Finally, when it comes to the luxury market, nothing is more paramount than the art of cultivating and servicing your relationships.
To create sustainability, never forget that when it comes to buying and selling luxury homes, you are dealing with one of the most important assets a person owns. Therefore, treat each deal, both pre and post, as though it is as important to you as it is to them.
So, if you want to be part of the 15 percent that occupies the luxury market, make sure you are exceptional in every aspect — from looking the part to cultivating your relationships and all things in between.