As the real estate market in the USA is slowly continuing to restore its position, many agents look this time as a chance to redefine their market. With so many agents who refuse, or at least significantly reduce their marketing systems, to save money, others jump to take advantage of the marketing void. In other words, they use an abusive approach to put themselves in a favorable position when the market begins to rise.
On the other hand, in most parts of Canada, the market continues to be hot, and agents are looking for the best way to grow their business. They seek to expand the reach of their marketing and maximize their income opportunities. Whether in the United States or Canada, a number of agents with whom we speak believe that the time has come to move to the ultrahigh market.
Traditionally, luxury real estate is one of the most difficult market segments to try to penetrate. What for? There are several common reasons. Perhaps the presence of a dominant agent is already staffed by the community or the fact that everyone already has a peer in the real estate business. Perhaps due to the fact that the agents themselves do not have the patience to work in a slower market (fewer transactions, tougher competition and a slower sales process). Maybe they are just not ready for the unique challenges that creates a high-class market.
In my experience, this is usually a combination of these reasons that prevent most agents from becoming successful in luxury real estate. Before you make a quantum leap in the next price range, you need to know a lot. We have compiled a list of five factors that will help you decide whether the transition to luxury real estate is right for you.
# 1. Find out what you get
Agents often make a blind leap into luxury real estate because they think that “where is the money”. Of course, this is simple math. If you get the same split, it pays to list homes with higher selling prices. In theory, you can make more money by doing multiple transactions. On the one hand, this is true, but if you go into a luxury property with this mentality, you are probably destined to fail.
Yes, your income per transaction increases significantly. This is great, but often there are many problems that arise when working in the high-end market: competitive rates are much higher, social circles are different, and there are many other factors that I will discuss in detail in this article. In addition, marketing and maintenance costs are usually more connected with luxury homes and customers. Both buyers and sellers expect more and require more, and the properties themselves require even more attention (marketing, staging, photography, etc.) in order to appeal to a more complex crowd.
Carol Barkin from Toronto, Ontario, has been a successful sales representative for 20 years, but it took some time to build her business in her elite markets (both in the city and the recreational market on the lake for about an hour outside of Toronto) . “For me, the biggest problem was creating this first connection,” she says. “They already have close social ties and they know how to get what they want, so building relationships is a matter of trust.
# 2. Patience, patience, patience
It is clear that luxury real estate is a different animal than traditional residential markets. It tends to move much slower. As a rule, there are currently fewer homes on the market and there are fewer buyers to purchase such high-priced properties. The rates are higher for all participants. Thus, on average, it takes significantly longer to sell one of these houses. In addition, there are many competitors for a limited number of facilities, so it often takes more patience to enter the market and create a strong customer base.
This is certainly the case when the end usually justifies the means if you have the right understanding and commitment. Although the lists are harder to come by and they need more time to sell, the big check at the end of the transaction is worth it, but not all agents have a stomach to wait longer between commission checks. Often this is an obstacle that stops them on their way.
“In my experience in luxury real estate, six months on the market is nothing. On average, that's more than nine for listing sales, ”says Robin. “In addition, if they are not really motivated to sell, you will spend a lot of time and money on marketing. In some cases, I will adjust my commission rate so that marketing costs are covered by the seller. You also do not have to go to a luxury property without money in the bank. This is a long process to build your business, and if you are not ready, it can quickly break you. ”
# 3. Know that. Survive it. Keep it exclusive.
Another reason some agents are trying to find their feet in ultrahigh markets is that they cannot treat customers or communicate effectively. You are dealing with a much more savvier and usually more demanding crowd that knows what they want and is used to get what you want. Now you don’t need to live in the luxury community that you are aiming at, but you have to present yourself just like you. The way you dress, your ability to connect to networks, how you communicate with these experienced people, the quality of your marketing materials - you should be able to establish a personal connection and create a strong professional image. If they do not buy you as a luxury home expert who is in their community, they will not work with you with you.
Jack Jeffcoat III is an agent who is currently shifting his market orientation from elite golf clubs in Central Florida, and has ultra-high seafront properties along the Florida Space Coast. From his marketing presence to his personal presentation to his service strategies, all he does is support his image as a specialist in luxury real estate. He is often defiant and unshakable in his approach, because he never wants to lose confidence.
Think of it as any high-quality product that is in demand because of its limitations and exclusivity. As a real estate agent specializing in high-quality properties, you, your marketing image and the service itself, should reflect the maximum quality. If you look and act like the best agent, people will strive to work with you.
“When I take a presentation, I interview the seller to make sure they are ready to follow my recommendations,” says Jack. “At every opportunity I want to remind them why they hire me. They know that I am a real estate expert in real estate, who works only with an exclusive group of clients, has a successful sale, they need to follow my example. and keeps me as a market specialist. ”
In addition, keep in mind that luxury properties will not necessarily be the same from region to region. A waterfront community in Florida will have a different set of challenges than the community of mountain resorts in Colorado or the high-rise center in Toronto. In some places, the “high-end” may be $ 400,000. In other prices can be multimillion. Therefore, when it comes to your personal presentation and how you sell yourself, do not forget to properly present your niche and look impressive.
“You always look bigger than you,” says Robin Milonakis. “You must have exceptional marketing materials, they must make people feel good to hire you. It feeds their ego, knowing that they work with the best. ”
# 4. Image has it all, especially in marketing
When it comes to your marketing materials, quality is key. You cannot position yourself as a high-class agent if your materials look incredible. A primary personal brochure and dynamic website is absolutely essential. Your personal brochure should replace your business card whenever you meet a potential customer. It should look sharp and impressive at first glance (exceptional photograph, nice glossy paper, complex writing, clean design). It should reflect your individuality, and also relate to the luxury market you are targeting. In a sense, you are a representative of this lifestyle, and your marketing must convey this. It shows your unique experience and highlights the benefits of services and knowledge that make you a specialist in this great market.
It is very important that you do not stint here, or it will show. You just can't fake high quality. You must be willing to invest money to make a marketing right, or people will see through it.
Simply put, a brochure and all other marketing materials should be of the highest quality. This includes advertising your home. You should at least have a tabloid-sized flyer / brochure that you use to promote each object. This production should be excellent. The photo must be very professional. Of course, you must clearly record the brand of property on your personal image (logo, colors, fonts, etc.), so that you do not lose your identity.
“My brochure is quality, and people associate this part with its sender,” says Carol Barkin. “I send him to meet someone to warm them. It gives me more confidence and shows my knowledge of the market they are worried about. ”
The same is especially true when it comes to your website. It should reflect the quality of your brochure and other print media. It should look sharp and feel like a representative of your luxury market. Two of the agents I interviewed with Jack Jack and Robin Milonakis are actually in the process of updating their campaigns in order to better target their high-profile clients. Despite the fact that both of them were very successful in their current campaigns, they know that it is worth the investment to bring their marketing to a new level to promote an exclusive niche.
One bold strategy that Jack uses is to have only properties above a certain price displayed on his website. Does he take listings at lower prices? Yes, when the situation requires it. But his image is an expert on luxury real estate, and his website is another way to show it. “If one of my potential clients goes to my site and sees a bunch of inexpensive listings, then this really does not help my business,” says Jack. “As a doctor, specialists make more money and gain more trust, so I want to be a well-known listing specialist in all aspects of my marketing.”
When it comes to online marketing, you also need to make sure that you are very active on your website. You can’t just place a website - no matter how it looks - and expect it to generate business in the long run. You must actively post informational links, articles, blogs, calendar events, community information, etc. To make it a resource that people want to return on a regular basis. Your active participation on the site will allow you to better communicate with your target market. And, of course, it also boosts your SEO (search engine optimization) to help you generate more potential customers through all major search engines.
# 5. Be prepared to support this.
In addition to the fact that your marketing campaign and personal presentation are representative of your market, you should also make sure that you are fully tuned to the market itself. If you do not know everything that is happening around you, you can never become a professional of luxury. This is one area where you cannot fake your way through a transaction with minimal knowledge or experience. Customers expect more and demand more from you, so you should be able to reserve your applications as an expert in terms of both your knowledge and your service experience.
“Expectations from customers are different, and in general they are more demanding. They want you to be available to provide answers and information, ”says Carol Barkin, referring to the clients she works with. “In the end, they have to make their own decisions; they collect tips and professional advice from me so that they can come to their own conclusions.”
However, never underestimate customers. need for updated information. Be active in giving them regular updates (at least once a week) on market activity. Always watch what happens in the market. Word travels quickly in luxury real estate, so make sure you know what is going on - what listings are sold, how much, how many were on the market, etc. If you are not in the whole market, your customers will be all over you. Like that you communicate, they will feel better about the experience
“Regardless, I personally will call each of my clients on Monday with a detailed market update,” says Jack Jeffcoat. “I do my best to always know what is happening in the market.
Then make sure your service experience reflects your marketing image. You must be able to fulfill your requirements by making the client feel special throughout the process. Think of it as the difference between the Ritz-Carlton and the Marriott. This is a completely different experience from the moment you pass through the doors of any hotel, and this is because you are paying significantly more to stay at Ritz. Imagine your real estate service as a luxury experience. It will make you a valuable commodity in the market.
Is a luxury market right for you?
Ultimately, it's up to you. You must be prepared for unique challenges and tough competition in the world of elite real estate. You need to make sure that you are patient enough to cope with a slow market. You must be willing to spend time and money not only to brand yourself as a specialist in luxury, but also to maintain it with higher standards of service and expertise. If you are ready for what the high-end market expects, this can be a very profitable place to do business in the long run. And while you are in a slow market or in a hot market, now is the time to take a big leap!
