In their book Freakonomics: A Rogue Economist Explains the Hidden Side of Everything, authors Steven D. Levitt and Stephen J. Dubner included a memorable chapter that talked about how real estate agents use their information advantage throughout the sales process.
Comparable home sales, market analysis, even the network of colleagues and potential buyers — all of these offer an advantage for smart agents and help them get new listings. It’s then up to agents to determine how to use that information — either to fulfill their fiduciary duties to the client or to enrich themselves.
Of course, your responsibility is to your client, and the way you use your information advantage should be designed to increase their bottom line, not yours. Here are some of the ways that you can put your knowledge to work.
1. Understand your client’s priorities
One of the discrepancies that Levitt and Dubner point out is the difference between the way that real estate agents sell their own properties and the way they sell their clients’ properties. On average, real estate agents charge more for their homes and allow them to stay on the market longer. By being more willing to wait, agents end up selling their homes for more money.
If your client is in a hurry to sell, they may have to make a trade-off by lowering the price of their property. However, if they are willing to wait, it is your responsibility to help them do that in order to get the price they need. Your duty to your client is to help them meet their goals — not to rush them in order to meet your own.
2. Work your professional network
Part of the perceived value of real estate agents is their connection to colleagues and potential buyers in the area. It’s not enough to put a listing on the MLS and wait. Hit the phones, send out an email blast, and work your social media contacts to ensure that your listing gets noticed.
While you may not be able to host a broker’s open house right now, you can do a high-quality virtual walk-through and send it to the biggest buyer agents in your area. In addition, make sure that you’re reaching out to your network on a regular basis — not just when you have a new listing — so that your outreach is more successful.
3. Make your marketing more effective
One of the most surprising things in the Freakonomics section on real estate was their analysis of effective property descriptions. They found that terms like “well-maintained,” “charming” and even exclamation points actually decreased the perceived value of a listing. Why? They were considered too general, offering enthusiasm in place of real information.
What made a property description effective? Specifics like “granite,” “maple” or “state of the art.” These terms offer specific information about the home’s fixtures and finishes, making potential buyers more interested and excited about the home.
If you hate writing property descriptions and throw out a generic one when you take a new listing, you are doing a disservice to your sellers. No one knows that home like you, so it’s your responsibility to highlight the specific features and materials that will help it sell. That includes a well-crafted, specific property description and photos that highlight the home’s best features.
As a real estate agent, you’re entrusted with a great deal of information about your clients, the market, your colleagues and the homes you list. Put that information to work for your clients in order to produce better outcomes every time.
Troy Palmquist is the founder and broker of The Address in Southern California. Follow him on Facebook, or connect with him on LinkedIn.