If you have been to any of my live seminars, you know that a salesperson should memorize the best answer to all the common questions. You also know that most questions have one best answer. All the other answers are second best. You also know that the best answers to most questions is a question.
Let's talk about real estate commissions. It seems to me that most Realtors don't charge enough commission. People do what they are paid to do. Given a choice to do this or do that, most people will choose the most lucrative choice.
If a buyer's agent is looking at a $300,000 listing that pays a 3% commission and a $300,000 listing that pays a 3.5% commission, which one of those two listings will she show first? Which one will she show most enthusiastically? I will bet on the 3.5% commission. Should we apologize for that ? I don't think so. We need to exploit that. List your next listing at 7% or better yet, 7.5% , Put it in the MLS at 3,5% or 3.75%. Get ready for closing. Don't take my word for it. Try it.
Mr. Seller usually only knows what we teach him. Teach this principal. Michael Lebouf wrote a whole book about this. The title is "The Greatest Management Principal In The World". If I can condense that book down to one sentence, people do what we pay them to do. The house with the largest commission is going to get shown.
Imagine you have given your fabulous listing presentation. The seller loves you and your marketing plan. The seller asks, "How much is your commission?". You have the answer to that common question memorized. You reply as you always reply to that question,"at what price?". Mr. Seller says, "at the $300,000 price.". You reply, " That would be $22,500. Are you ready to start packing?". "Yes, lets do it" Mr Seller replies.
In the unlikely event that Mr. Seller objects to the higher commission, you know the answer to that objection. If you don't know the answer to that objection, no wonder you are listing houses at 6% or less. Watch this video before you make another listing presentation. https://www.youtube./watch?v=L7KlVi2Ic8Y
After your wonderful listing presentation and after your masterful objection answering technique, the seller says," I love you but Ms. Almostaswonderfulasyou, your competitor down the street says she will list our house for 6%." You reply, "If I would list you house at 6% would you go ahead with me now?" He replies,"yes" Can you live with that? Sign him up.
That is not what most new Realtors do. Most new Realtors when asked how much commission do you charge, reply, almost apologetically,"sssiiiiixxx per,per,per,cccent". The seller tries to beat you down to five. Memorize the best answer to that question. Get together with five of your peers and brainstorm five good questions that would be a good answer to that question. I don't think you can improve on "at what price?" If you do, let us know here with a comment.
Here is an assignment for you. I assign this as homework at my live seminars. Today, call all of your listings. Tell the seller that you have been to a seminar with a national real estate expert. Mr. Expert says that the reason your listing is not sold already is because the commission is too low. Suggest that we raise the commission to 8%. We will put it in MLS at 4%. Mr. Seller, start packing. I have had hundreds of students come in the next day and tell they were amazed that the seller said OK . Other students report that the seller did not want to raise the commission but suggested lowering the price. You could test this theory right now before your fanny gets up from the chair. Call one of your sellers and suggest that we raise the commission. You will amaze yourself. You will delight yourself. Post your results as a comment here.
Here is an ancillary benefit. If, in your initial solicitation of the listing, you ask for 7%, but the seller insisted on 6%, you can solicit Mr. Seller to raise the commission later in your service the listing calls. People do what they are paid to do. Ask for a larger commission. Answer the objection with the answer on the video. It works. I know it works. I have used it a thousand times.
www.ronclimer.com www.climerconsulting.com
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