For real estate agents who want to build a solid and sustainable business, obtaining an exclusive contract is the Holy Grail, the ultimate goal. But an exclusive contract can sometimes be difficult to obtain, because it requires total trust from the seller towards the real estate agent. As a real estate agent, you will have to double down on your efforts to convince a potential customer to trust you with the sale of their property. Let’s take a look at the essential steps to securing more exclusive contracts!
The content of this article is based on our webinar broadcast on 1 June 2021, hosted by Julien Cornette, who is a real estate expert and coach. Please contact us if you would like to receive more information and view the recording of this webinar (in French).
First of all, what exactly is an exclusive contract? It is a contract by which an owner instructs an agent to act on their behalf in connection with the sale of their property.
Generally, contracts or mandates can be simple or exclusive. As the name suggests, the former allows a seller to hire different real estate professionals, while the latter creates a single relationship with a single real estate agent.
Step 0: plan your meeting and make sure you come across as professional
After all, one always hears that first impressions are the most important. Before any appointment, it is important to be well prepared. This will enable you to position yourself as a leader and conduct the meeting successfully, keeping in mind three important aspects:
- Understand your customers’ background: Get to know your customers first, understand what makes them tick as well as their expectations.
- Property evaluation: This step must not be skipped, and it must be taken after having evaluated a potential seller. Otherwise, the human aspect of the sale might be overlooked.
- Guidance: This is the time when you answer your potential customers’ questions. Address their fears and anxieties, reassure and support them in their decision.
These elements, which make up the “process”, are the basis of the four stages that will naturally lead the owner to award an exclusive contract for listing their property.
Step 1: valuation and pricing
The first barrier to overcome is a discussion about the price you think is realistic, as opposed to the price the seller hopes to achieve. Always base your pricing on facts. There are different methods available to you (comparative approach, qualitative approach, rental approach or competitive analysis). The objective is to explain to the seller how the price was established, and to validate with them the process you used to arrive at the price. For this meeting, prepare a valuation report. It will serve as a basis for explaining your pricing and will support your sales argument.
PriceHubble tip: Consider using digital tools for preparing your estimate file. Tools like Property Advisor allow you to provide accurate and comprehensive estimates more efficiently.
You will often find a discrepancy between the price the seller hopes to get for their property, and the price you consider appropriate for their specific market segment. Julien Cornette explains this discrepancy by citing the “four losses” that the seller will have to accept at the time of the property transaction:
- Memories: moments spent in the home with family and friends.
- Relationships: the network built up around the property, with neighbours, shopkeepers, etc.
- Habits and routines: there are many – for example, the daily trip to the bakery where the seller used to buy bread.
- Financial: your seller will set a selling price that may not be in line with your estimate of their property.
The sale of a property often unfolds in a complex emotional atmosphere, and the seller will need to go through these four losses in order to fully embrace the selling process. It is therefore up to you to guide them, reassure them and answer their questions.