Poor feedback and unrealistic expectations given to the owner based on feedback that has been designed to either back up the agents original appraisal to get the listing or a need to have the owners happy throughout the campaign.
Topic – Smarter Auctions
Mentor – James Bell
- Lack of working with buyers and education
- Wrapping the sellers in cotton wool
- A lack of marketing or working their database
Kevin: A failed auction. What causes it? How much responsibility do we take ourselves as listing agents if an auction doesn’t sell? Well, where has James Bell, who’s my guest this week, seen agents fail in their lead-up to auction day?
Kevin: James, welcome to the show again. Thank you for your time.
James Bell: Thanks, Kevin.
Kevin: I gave you this in advance, I gave you all the topics in advance, ’cause I really wanted you to think about this one. What have you found? Where do agents go wrong?
James Bell: Kevin, I think, linking back to a few comments over the previous three days, is really core feedback. And what that does it provides unrealistic expectations given to the owner, which what I found has just been based or has been designed to, one, either back up their original appraisal on the property, unfortunately-
Kevin: Yeah, which is a problem.
James Bell: … or really have a need to keep owners happy throughout the campaign. I think, coinciding with that, is a lack of working with buyers and their education, and I think sometimes agents are a bit scared of really pushing the buyer a little bit deeper than what they might be used to.
Kevin: What, for fear of losing them?
James Bell: Well yeah, fear of losing them, but I think one thing I’ve always experienced, if there’s a serious buyer out there, and you can build some form of trust with them, they’re always very happy to talk to you. I think the days of what I would call a service agent where you’d get a phone call into the office: “Oh, what are you looking for? Three bedrooms. Okay. What suburbs? What’s your price limit? Okay. I’ll add you to the database.” Whereas I’ve always tried to teach that, you know, “What areas’ you looking for?” all that sort of stuff. “But have you bid at an auction before? Yes or no? Okay. What offers have you put in on other properties? Have you been to a bank? Have you got finance approval? Do you know if that finance approval allows you to purchase at auction?”
James Bell: So all I’m trying to do in that scenario is just understand who my buyer is. If they’ve bid at another property before, that obviously makes the education process a lot easier, but I think what I find is a lot of agents go into these auctions not actually knowing about their buyers, what’s their real reason for purchasing, what offers they’ve made on other properties, because all that sort of information does leave clues.
Kevin: It does. I want to go back to what you said right at the very start, because I think this is a key thing here. It’s one thing to work with the buyers, and you can get your buyers and get a good understanding about them, but unless you’ve got your sellers ready to sell, really ready to sell, and ready to meet the market, then it’s not going to come together for you.
Kevin: You talk there, right at the start, about not wanting to have that hard conversation, I think. But I call it “wrapping them in cotton wool”, that fear of upsetting them. That’s a real bridge for a lot of people.
James Bell: Oh, of course it is, Kevin, because at the end of the day, I think the general feeling that we have as human beings is we want to keep people happy. But, as I remind and have reminded a lot of my team over the years, that we are actually a professional service, and we have to give professional advice. And I think, rightly or wrongly, there’s some things that happen in our industry whereby yes, we sometimes do get listings when price has been the determining factor in what we’ve told them, and when the feedback isn’t coming in at that level, there’s reluctance to let them know.
James Bell: As you say, there’s that reluctance to have that conversation, and keep these owners in cotton wool, which serves no one the right purpose, let alone your owner who you’re meant to be acting for. It serves them no benefit whatsoever.
Kevin: Yeah, none at all.
Kevin: James, thank you so much for your time again today. We’ll come back tomorrow. I want to find out from you what you found outstanding agents do that other agents don’t, which is a bit of a continuation from today.
Kevin: Thanks for your time, James. Talk to you in the morning.
James Bell: Pleasure, Kevin.