At Concierge Auctions, we know luxury real estate. Our principals have touched every aspect of the business. In fact, we were born out of the brokerage community. As a result, our combined efforts have produced nearly $1B in sales — spanning 32 US states and 11 countries — and our global Rolodex includes over 370,000 contacts.
We maintain a pulse on the top luxury markets worldwide.
This 5-part blog series details what we think are the most important factors in preparing to sell your luxury home. We hope you find it useful.
In the last two weeks, we reviewed the process of selecting your agent and evaluating the competition. This week, we continue with the third part.
PART THREE OF FIVE: KNOW YOUR MARKETING STRATEGY
There are a number of elements that make up a marketing strategy. At Concierge, we have an entire team of people who are dedicated to marketing and selling your home. You may not find this with many traditional brokerages, but below is a list of what you need to demand and expect.
PROFESSIONAL PHOTOGRAPHYThe first impression of your luxury home has major impact on buyers — Are they looking at high-end or the end-of-the-line? The difference in influencing a buyer’s perception of your estate, no matter how grand, is a matter of hiring a professional photographer to document and bring out the assets of your property.
The days of the old MLS books are gone. More than 90 percent of home buyers are searching on the internet, and photography is a feast for the eyes in terms of initial interest in a property. Has your agent committed to having professional photography taken? If they haven’t, you should insist. Low-quality or amateur photography is obvious online.
If your home is already listed, then it is likely already online. Find it by searching your street name, actual address, or even your full name. No one loves your home more than you right now. Would you buy it, or even look at it, based on what you see online? If not, do something about it.
Hiring a professional photographer can be a cinch — ask for referrals from property managers and agents whose estates look the best online and in print collateral. Ask to see a person’s portfolio before you commission the work; a fancy camera does not a photographer make.
EMAIL MARKETINGFor many buyers, getting your property at the top of their minds means getting your property at the top of their email box. Savvy agents may maintain a fantastic personal website for their businesses and can tell you the buzz about how they incorporate social media into their repertoire. Ask how each agent reaches his or her database of buyers and how they’ll enlist fellow agents to do the same. Getting attention for your luxury home is about generating buzz, and you want to know how your agent will get the word out.
MANAGING YOUR ASSETToo often, emotion gets in the way of making a smart business decision when selling a home. If your goal is to generate a sale and monetize the equity you’ve built, listen to the data. Selling a property is a data-driven process. If the data says that there is five years of inventory, and that a typical list-to-sell ratio is 80 percent, you can reasonably expect to sell your $5,000,000 listing for $4,000,000 in five years. Then factor in that it generally costs 1 percent a month to service this home (consider taxes, insurance, loans, opportunity costs, and so on), and subtract five years of this expense (60 months at $50,000 a month = $3 million). The result: a net-present value of $1,000,000 today based on the market data.
The bottom line is that hope is a flawed strategy. If you are a serious seller, find a disposition vehicle that can help you maximize the net-present value quickly and let you move on with your life.
Bridging the disconnect between the “bid” and “ask” is a matter of creating a compelling buying opportunity and forcing the market to act. This is especially true when the prospective pool of buyers is very thin. The only way to drive price is to aggregate competition and force it to compete. Position the buying opportunity in a manner that is impossible to ignore.
MYTHSWith the news today, every luxury seller wants to believe a wealthy Russian or Chinese billionaire is going to swoop in to buy their lovely home. The luxury real estate market doesn’t operate like a fairy tale; the reality is that almost all local transaction volume is driven by brokers already in market, not from an exotic locale. Reach is important to expose the opportunity, but the strong relationship a buyer has with his or her broker is what likely will affect the sale. A broker doesn’t necessarily need to be a top producer to perform well for you. The real questions are whether he or she is accessible and whether his or her relationships with peers are good and cooperative. Brokers should regard other brokers as their best clients. Find one who is well regarded, will do the work, and has the relationships necessary.
Next week, we discuss staying the course.