Powerfact: Any agent who has been in the business more than five minutes has probably at least once run into a commission objection.
Communicating value — not just justifying a commission is a practiced skill – and a necessary one – especially when competition gets tight. When it’s between you and the “other guy who will list it for less” – what do you do?
This is a topic that comes up frequently on our weekly Coaching Calls. Let’s run through what that conversation might look like: (Disclaimer these commission numbers are just an example – agents are free to negotiate whatever number they feel comfortable with.)
When you tell the homeowner that you ask a 6% commission, they may tell you, “I don’t want to pay 6%. There are all these other agents that are only asking 5% so that’s all I want to pay.”
You can say, “Alright, let me clarify. If I tell you that I am willing to go down to 5%, you would be willing to sign right now and hire me to be your real estate agent?”
The seller will probably respond by saying yes, and that is where you ask the most important question. “So, let me just ask you this: If I go down to 5%, why would you choose me over those all these other agents who are already at 5% and you wouldn’t have to discuss lowering commissions?”
The home-owner will begin to list their reasons: “Well, I like you and I trust you, you seem like you care about us, and you know what you are doing. I really like your marketing plan, and you seem to have plenty of experience.”
This is when you can communicate the true value of everything that you have been discussing with them through the listing appointment. “Well, Mr. Seller, all of those reasons that you just listed is why I am worth the 6%.”
Homeowners tend to look at the bottom line, and who doesn’t want to feel like they are getting a great deal? Before this pandemic, this conversation was common because most home sellers didn’t believe it took much effort to sell a home. Agents often needed to spend more time convincing homeowners of their value and how much they were getting in return for that commission.
New Real Estate Reality
In this new real estate reality, home sellers rely more on the agent’s expertise to conduct open houses and showings safely and swiftly, but the fact that they want to be secure in their choice of agent hasn’t changed at all.
When the home sellers can understand the tremendous value of having an agent focusing on their needs, and the value of the work that you are going to be doing to sell their home, they will realize very quickly that the VALUE of working with you is worth far more than that 1% extra in commissions. They will see that they will get what they pay for (and then some!)
Power Agents, there is a great eGuide you can share with your listing prospects called The Top 184 Things Real Estate Agents Do to Earn Their Commission — you’ll find it in your Listing Appointment tab!
It’s a great validation tool for communicating value!
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Need help? Contact our team today at (800) 395-3905!