Selling luxury real estate can be a real challenge. As I’ve said before, there are certain things that make selling a luxury home different compared to a normal home.
The biggest factor is pricing and marketing, but there are other elements at play.
This is the definitive guide to selling a luxury home, from the initial listing appointment to the day of closing.
The Listing Appointment
Entering the Home
I’m going to assume you have a prospect and have set the listing appointment.
I won’t go over how to get leads in this article, but you can check out my luxury real estate marketing essentials here, which might land you one.
When you get to the prospect’s property, knock on the door, greet them, and ask if you need to remove your shoes before entering. Asking this question is purely out of respect, but it can also literally get you the deal on the spot.
Upon entering, give the house a quick compliment to ease the prospect.
Understand their situation. They are letting a complete stranger walk inside their home. They have their guard up. Nothing is more soothing than hearing that you like their home.
Say something like “oh wow, this is beautiful” or “your living room is lovely”.
Ask for a Tour
This part is important. You don’t want to sit down and get straight to business. By requesting a tour, it shows the prospect that you’re here to help them, not make a quick buck.
Plus, I don’t know what possessed you to get into luxury real estate or real estate in general if you don’t want to tour a luxurious home.
On top of that, if you do get the listing, then you need to be an expert on the property. You can’t sell a product you don’t know.
While on the tour, be sure to take notes with a pen and paper. Write down the key features you notice.
Ask questions about designs, customizations, the story behind objects or the home itself. Ask about the prospect’s favorite memories in the house, their favorite room, and what stood out to them when they initially purchased it.
Not only will this help you later when you launch your marketing campaign, but these simple questions can help foster a better relationship with you and your potential client.
The Business Talk
The most nerve-racking part for a real estate agent is the conversation about listing the home. It’s also the most rewarding.
Every luxury real estate agent has their own style. I tend to be the guy who drops a lot of knowledge about marketing, market statistics, the direction of the luxury real estate industry, what I think their home is worth based on what I know about the luxury market, etc.
I’m not a pressure salesman. I try not to deliberately sell myself. I simply let my deep knowledge and passion for luxury real estate win prospects over.
It works for me.
But for the sake of generalization, let’s talk about what you should do.
Learn Your Prospect During the Tour
I recommend studying DISC personality traits.
This helps tremendously since you’ll know what cards to play to make your prospect happy.
The way you learn their DISC is by paying attention to what they say during the property tour. This is especially better in the luxury real estate market because generally, homes are larger, giving you more time to talk and warm them up.
A great way to break down their guard even more is by asking about their favorite memories. Often, their true personality will begin to shine, allowing you to identify who they are right then and there.
The biggest question on a prospect’s mind is what you’re going to do to sell their home. Plain and simple.
They don’t care about the house you sold last week or the one you’d like to sell down the street. They might think you’re experienced if you sold one last week. But that doesn’t solve their problem.
They want to know about their house and only their house.
If you’re a good luxury real estate agent. You focus on marketing from the get-go since that differentiates us as agents the most. It also allows you to answer their primary concern of… let me repeat…
Selling. Their. Home.
If you overcome their objections to your marketing plan, you’ve won more than half the battle.
The Commission Conversation
Even I don’t like this.
I don’t know why but I get uncomfortable when prospects ask me how much I’m going to charge them.
I guess it’s because I subconsciously know that I’m about to charge them many thousands of dollars and as a person who grew up with a financial situation below-average means, I truly understand the weight of money.
Despite this, I do know my worth, which is generally 2-3% in professional fees.
Notice I use the term “professional fees”.
Use it and you’ll look more and more like an actual professional.
I will admit, I have changed my fee for certain reasons at other times. Setting bylaws for your professional fees are purely unique to your business.
I have known real estate agents to create full-fledged commission structures where they charge based on the marketing plan the client chooses.
I personally don’t do this because my marketing plan is extremely consistent and my primary value proposition that I offer clients, but everyone is different.
My best advice is to understand your worth going into a listing appointment so that if an objection about professional fees comes up, you can defend yourself with your heart instead of what you were told to say by other agents.
This can be a real challenge and should be dealt with based on the situation.
Most prospects believe their home is the greatest place on the block and sometimes they’re right.
Sometimes they are not.
I’ve once been told that the property needs to be priced $40,000 higher than the home of the same model down the street because the yard is roughly 200 square feet larger.
This was a difficult conversation.
Use your best judgment.
It’s best to study the market around the property and pull relevant sales data. I would advise against basing the price off relevant properties in the area because most luxury homes are unique and no luxury homeowner wants to believe their home is similar to someone else’s, and rightfully so.
Also, take the time to learn luxury real estate beyond your region. This can give you an insight into how properties of similar design and style sell in other areas which can help your pricing and marketing efforts.
Overall, it’s up to the homeowner and what they want to list at. It’s your job to steer them in the right direction.
To Stage, or Not to Stage?
The basic idea in luxury real estate is that you need to appeal to the buyer profile you’re aiming to sell to.
Staging makes this possible by bringing furniture rentals into the property and positioning them in a form that makes them most appealing to the lifestyle your buyers would want.
This conversation can end with the seller paying for staging costs, you as the agent paying, a 50/50 split, or some other arrangement you come up with.
Sometimes staging isn’t needed, but a lot of times it is.
Obviously, there’s paperwork involved in selling real estate.
Every U.S. State and real estate firm requires different documents to get filled out. You’ll want to talk to your leadership or other experienced agents about what needs to get submitted.
The good thing these days is that we can sign agreements electronically. Meaning if you forget something during your appointment, you can always get them to sign an extra form once you get back to the office.
Of course, understand the laws as well. Know what the documents say so that if you’re asked about the meaning of something, you can give an answer.
Nothing’s worse than not being able to answer a question about your own job.
List the Property
You’ve got a listing agreement and you’re almost ready to sell luxury real estate.
Now you need to actually “list” the property for sale.
First, you’ll need to wait for the home to get staged, if necessary. If staging isn’t necessary, then move on.
Second, you’ll need to hire a professional photographer to take pictures of the property.
Once you get photos, log on to your MLS and write out all the information you got from the homeowner into the listing sheet. Pull tax data and other various details about the home so that you’re completely covered and fill out every little detail.
The more information you provide, the better.
You’ll need to write an engaging description of the property, so be sure to take your time on this and really make it sound good.
Every state and MLS operate differently, so if you don’t know how to do these things, ask an agent to help you out because I won’t know (until Berri Luxury Properties becomes a national company of course).
The Fun Begins: Launch Your Marketing Campaign
I don’t know about anyone else, but marketing is my absolute favorite element of real estate.
To me, there’s nothing more fulfilling than conducting a property tour and sharing everything great about my client’s homes.
It’s super awesome to create cool custom brochures, flyers, postcards, and other print materials.
I adore the website building process and the constant implementation of new pages and articles.
I love making content and sharing it with the world. Watching my creations get shared and distributed to thousands of people on the internet.
If you have a passion for marketing. You’ll probably do well in luxury real estate.
Film a Property Tour
I’m going to assume you’ve read my other articles on marketing and have seen my emphasis on video property tours.
In 2020, luxury real estate agents NEED to film property tours.
Whether you get in front of the camera or not, you at least need some sort of video so that you can increase engagement and visibility when you post to your social networks.
Of course, you need good images, but videos have been proven to help users remember a call to action such as “buy this home” by 95%.
These numbers aren’t going away anytime soon.
Show the home via video, point out special features, designs, whatever, and get the property sold.
Use Online Advertising and Content Marketing
If you are a luxury real estate agent in this era of sales and still aren’t creating Facebook, Google, or LinkedIn targeted ads, you’re being naïve and missing out on a lot of opportunities.
For new luxury real estate agents. You live in a beautiful time for luxury sales.
I suggest everyone stop listening to the old-time real estate agents that claim they’ve never paid for Facebook ads and start getting real.
Organic social reach in business is declining due to Facebook’s algorithm changes. Mark Zuckerberg said himself “you’ll see less public content like posts from businesses, brands, and media”.
Because Facebook is the King of social media, everyone else is going to follow their lead. In the coming months and years, we’ll see a dramatic decrease in the power of organic social engagement within our businesses.
Unless we start to do things right.
We’ve moved to a content economy that is based on creating valuable, original content that encourages engagement between human beings.
Trust me. Content is not easy to make.
Posting the property you just listed on Facebook does not get nearly as far as it used to because that’s what literally every other real estate agent is doing.
A way to drive people to your posts is by advertising with paid ads and creating valuable content that drives engagement.
The engagement you’ve driven from the ads and content will, in effect, cause your property posts to get caught in the collateral, now that you’ve warmed your audience by providing them value.
Businesses that provide value outside of their basic services will win in the digital economy.
If you’re serious about your career, start investing time into learning online advertising and capitalize on the vast majority of real estate agents who are naively ignoring it or doing it wrong.
Contact for Content
As we just talked about, content will help drive your sales by effectively creating a collateral effect for your property posts, website linkbacks, and social pages.
Another use of content is to nab quality leads by enticing them with something of value.
This can be in the form of a free home seller’s guide, buyer’s guide, etc. In exchange for their contact information.
This can kill many birds with one stone.
You’ve gone ahead and gotten a new contact, you’ve now exposed them to your brand so they’re getting warmed up, and you’ve also begun to nurture them by providing them with a quality item that’s branded by you.
That’s the power of content.
Using Free Content to Scale Engagement
Content can also be distributed freely, as it is in most cases.
Writing a blog with quality articles (like this one), filming quality videos, memes, GIFs, and whatever original items can attract people to your brand and make them come back for more is a good content platform to work off.
The best thing about creating content is that it can be redistributed through various forms and pushed through multiple channels.
At the end of the day, information is information, and it can be shared in thousands of ways.
Videos can be repurposed into articles, then distributed to your website, Facebook, LinkedIn, Medium, and other platforms.
Blogs and videos can be transcribed into podcasts and distributed to Spotify, SoundCloud, and iTunes.
Literally everything you make can be pushed to another destination and made into different forms.
30 pieces of engaging content is more than most real estate agents will ever create in their career.
Content creation should be a part of your overall marketing plan, plain and simple.
Direct Mail is a Timeless Channel
Despite how online-based my business has become, I’ll never discount the power of the mailbox.
Email inboxes have become so full that people won’t respond to their Grandma anymore, let alone a real estate agent.
The good thing about the proliferation of the inbox is that the mailbox is slowly getting less cluttered.
This gives luxury real estate agents the ripe opportunity to return to the classic print mailer.
Make some branded brochures, flyers, postcards, and whatever else you can think of, and start sending out details of your listing.
I send over one hundred “Just Listed” postcards to the neighborhood surrounding the property.
Sometimes I send that sort of information to my geographical farm as well.
However, be careful with sending “Just Listed” mail to your farm. You don’t want to advertise a $3,000,000 listing to a neighborhood with $900,000 homes.
Use print mail in your marketing plan and you could very well find a buyer for your listing.
If no buyer comes forth, then you’ve at least shown people that your brand exists and is thriving.
Offer, Counteroffer, and Maybe an Acceptance
You’ve done a good job at marketing. An offer has hit the table and you’re on the home stretch (no pun intended).
But the homeowner doesn’t like the offer. Your best advice would be to give a counteroffer with more favorable terms.
My best advice is that you’ll always want to give a counter. Don’t deny an offer.
The Due Diligence Period
Let’s say the buyers accept your counteroffer.
Great! Now we’re on the way to the end. The next step is to be quiet.
In North Carolina, we have a due diligence period, which means the buyer has a set timespan where they can inspect the property and do whatever they want to figure out if they actually want it.
During this period, they can negotiate repairs or improvements with the selling side.
The buyers have until 5:00 PM on the final day of due diligence to make the decision of voiding the contract without a severe penalty.
The buyer retains the right to void the contract for any and all reasons during the due diligence timeline, with full entitlement to their earnest money deposit.
As the seller. It’s best to just be quiet during this period. Once the period ends at 5:00 PM on the date of due diligence, then it’s time to come out and talk.
I’m not sure if other states have this sort of system, so I can’t speak for you if you live outside North Carolina.
Prepare for Closing
Closing is relatively simple on the listing side.
All we really need to do is make sure everyone is on the same page. This means getting in touch with the buyer’s attorney to make sure we’re prepped and ready, making sure other parties are prepared and ready to go, and we’ve done our diligence in submitting any necessary closing forms.
In North Carolina, sometimes buyers pay for closing costs, but often it’s the seller’s responsibility.
This is also the time where the sellers need to start packing up the home if they haven’t already. As of the day of closing, they no longer reside in the home, barring some sort of tenancy agreement, which complicates everything.
The Closing Table
The closing is generally held at the buyer’s attorney’s office.
Here, funds will be disbursed, such as earnest monies or any other money held in trust, as well as the sale proceeds.
The title is transferred to the buying party, keys are handed over, and the home is officially sold.
It’s a great moment for both parties.
Being a real estate agent, it’s one of my favorite parts. There’s a lot of satisfaction to be had at closing.
The Journey Ends
You’ve done it! You’ve successfully listed, marketed, and sold a luxury home.
This is something to be proud of.
The feeling never gets old either. Every time you make a sale, you’ll feel that special something in your heart.
Unless you’re cold-blooded. I don’t know what you feel then. If anything.
I hope you’ve enjoyed this guide. If you have any questions don’t hesitate to comment below or email me at email@example.com