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For those who say “I want it now”

Posted by Steve Koerber on August 12, 2010

I’ve introduced a new service for my customers to make sure they’re the first to see new listings in my core area.

If you’ve been through one of my open homes recently, you will have received a text from me offering the service.  From then on, those who opt in receive a short text with appropriate new listings & viewing details.

Buyers –

1.  Indicate your price range

2.  Provide me with your cellphone number (txt 021864166 now)

3.  Receive text notification of listings as they hit the market

Sellers –

1.  Get the hottest buyers faster

2.  Create competition by funnelling buyers through quickly

3.  Tap into a real time fully qualified buyer database

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How Steve Koerber adds value to his seller clients by making it easier for people to buy their home

Posted by Steve Koerber on September 28, 2009

Omahu 1-13Recently I sold this home at 1/13 Omahu Rd in Remuera.  A very popular auction attracted eight bidders and it sold for a price the owners were very happy with.  Nothing unusual about that!

So here’s the unusual bit.  There were two separate bidders who had arranged to bid by phone.  One was too nervous to come to the auction and, in the end, was the top bidder and bought the house for $1,250,000.  

The other phone bidder lived in the UK and had never been through the house.  This bidder had spotted the house on www.barfoot.co.nz three days before the auction.  Especially since they hadn’t even been through the house you would think it would be a brave decision to phone bid at all.  So how did this person have the confidence to bid from thousands of miles away on a house they hadn’t been through?  I’m glad you asked.

The night before the auction this bidder spoke with me on the phone about the property.  Incredibly (though not surprising) he knew virtually everything he needed to know about the property.  Our chat was mostly about organising his deposit to be paid. 

Before our conversation ended, this is what this buyer said to me: 

“When I sent you an email enquiry about the property 3 days ago I received your very efficient auto-reply email in my inbox straight away.  I linked through to the council website for the CV, rates etc.  Then I linked through to the aerial view and checked the school zoning.  Then I looked at your comprehensive guide to recent local sales.  Then I printed off the LIM report and the title.  The LIM indicated a small defect but you explained on your blog & linked to an email from council that showed that there was no problem at all.  I printed off the Auction contract and had it checked out by my lawyer in NZ.  And I did all of this without needing to speak with you.  I felt totally informed and I must say I have never received this type of service from a real estate agent ever.”

Real estate people are prone to skiting aren’t we.  There, I’ve done it, I’m skiting about my service!  So if you know anyone who is buying or selling, perhaps you could recommend they check out my unique service here.  I’d love to help them and I’d really appreciate your referral.  Thank you.

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The Laws of Negotiating – by Brian Tracy

Posted by Steve Koerber on September 8, 2009

The Laws of Negotiating are closely related to economics. They are part and parcel of the same process. Both economics and negotiating are based on the fact that each person places different values on different things. Everyone behaves economically in the sense that they always strive to negotiate the very best situation or result for themselves in each situation.

The Universal Law of Negotiating

Everything is negotiable. All prices and terms are set by someone. They can therefore be changed by someone. Prices are a best-guess estimate of what the customer will pay. The cost of manufacturing and marketing a particular product or service often has very little to do with the price that is put on it. Don’t be intimidated by written prices, assume that they are written in pencil and can be easily erased and replaced with something more favorable to you. The key is to ask. pic_handshake-798699

The Law of Futurity

The purpose of negotiation is to enter into an agreement such that both parties have their needs satisfied and are motivated to fulfill their agreements and enter into further negotiations with the same party in the future.

The Law of Win-Win or No Deal

In a successful negotiation, both parties should be fully satisfied with the result and feel that they have each “won” or no deal should be made at all. When you are determined to achieve a win-win solution to a negotiation, and you are open, receptive, and flexible in your discussions, you will often discover a third alternative that neither party had considered initially but that is superior to what either of you might have though of on your own.

The Law of Unlimited Possibilities

You can always get a better deal if you know how. You never need to settle for less or feel dissatisfied with the result of any negotiation. If you want a better deal, ask for it. You will be quite astonished at the better deals you will get by simply asking for a lower price if you’re buying and asking for a higher price if you’re selling.

The Law of Timing

Timing is everything in a negotiation. Whenever possible, you must plan strategically and use the timing of the negotiation to your advantage. If you are in a hurry to close a deal, your ability to negotiate well on your own behalf diminishes dramatically. The person who allows himself or herself to be rushed will bet the worst bargain. You resolve 80 percent of the vital issues of any negotiation in the last 20 percent of the time allocated for the negotiation.

The Law of Terms

The terms of payment can be more important than the price in a negotiation. You can agree to almost any price if you can decide the terms. It is important to never accept the first offer no matter how good it sounds. Act a little disappointed when you hear the first offer, and then ask for time to think about it. Realize that no matter how good the first offer is, it usually means that you can get an even better deal if you are patient.

Action Exercise

Whenever possible, talk to someone who has negotiated the same sort of deal with the same person. Find out what the other person is likely to want and what he or she has agreed to in the past. Forewarned is forearmed!

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Privately sellers can lose bigtime

Posted by Steve Koerber on July 8, 2009

stk20561pwhWhenever I sell a popular home at auction I receive lots of phone calls after the event.  The calls are mainly from buyers who were unable to bid due to their circumstances.  People often want to know how much a home sold for so that they can compare it with others they’ve seen (or are likely to see) on the market.

One of my recent auctions attracted around 400 people during the 3 week marketing period.  The auction had 8+ registered bidders and sold for a great price. 

Early on I knew that if the auction program was correctly managed, I would achieve an exceptional result.  Several pre-auction offers were submitted.  In consultation with the owners we agreed not to sell circa $500,000 and to wait until auction.  They agreed, we waited, and sold for much more at $537,500.

From day one I was keen to prove a very important point with this auction.  A very similar home nearby (but not renovated) sold  a month earlier well under $500,000.  That home wasn’t auctioned, had 2 or 3 offers submitted and sold within days of hitting the market.

I had a great opportunity to prove that the logical way to sell a popular home is by auction.  If you’re a potential seller, please note that the owners of both these homes paid a similar fee to their agent.  My point is this – my owner got much better value, for the same cost. (Yes, I have an ego , they chose the right agent).

But that’s not the end of the story.  After auction sales I always ask my callers to guess the sale price before I tell them what it was.  This is a fascinating exercise and the range of guesses is always huge.

After the above auction I received a call from a fellow who was keen to know the sale price.  His guess was $500,000 or $510,000.  When I told him $537,500 he was shocked that it was so high. 

I then discovered that he had just accepted a private offer under $500,000 for his house nearby.  That is why he was shocked!  He was thinking – Have I under-sold?  When he asked if I had similar homes available for him to buy, the reality of the situation dawned on him.  Even if I did, there were 8 people lined up to buy it.  Scary but true.

As a seller, if you really know the market and have your finger firmly on the pulse, selling privately might be a real option for you.  My concern for you is this:  if you misinterpret market conditions you might be surprised how much a good agent could get you for your home.  Especially at the moment in Auckland, it’s important to make people compete for the right to buy your home.

The selling process needs to be managed carefully from day one.  I hope this story demonstrates the value a good agent (and a good process) can add.  If you’re selling privately in this hot market, there’s a big chance you’ll lose money.

Posted in Selling your home | Tagged: , , , | 3 Comments »

Evidence of Excellence

Posted by Steve Koerber on June 21, 2009

 

17 June 2009

To : Steve Koerber

Barfoot & Thompson

 

Dear Steve,

Thank you for making the sale of our house so comfortable and successful.

We were very reluctant to sell by auction and you had quite a job convincing us to go that way. We are so pleased we followed your advice!

You guided us through the process and managed the three weeks of marketing with great skill, attention to detail and clear communication.

All the Barfoot & Thompson agents who came to our house were courteous and a pleasure to deal with.

We appreciated the way we were looked after throughout the whole process, including the auction itself.

Our confidence in you was well rewarded; we are delighted with the price achieved.

The marketing budget and commission fee were worth every cent and definitely good value.

We would recommend anyone wanting to sell a house in this area to come to you and to follow your advice.

Please accept our very grateful thanks to you and your wonderful team.

With best regards,
Cheryl & Grant Mitchell
52 Clonbern Road
Remuera

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Real Estate Commissions

Posted by Steve Koerber on April 1, 2009

I just wanted to clear up a common misconception regarding real estate commissions.  I often hear people say that in NZ our commissions are higher than some other countries.  A figure of 4% is often ‘bandied about’ and people complain that this is high.

It’s important to get the facts right.  No real estate company in NZ charges 4% on a typical house sale.  However, a small component of commission is sometimes charged at 4% or 3.95%.  Have a look at this: 

Residential Commissions (including GST)

 Selling Price  Barfoot & Thompson  Typical Auckland Fee*
 $200,000  $9,000  $9,513
 $300,000  $13,331  $13,809
 $400,000  $15,581  $17,074
 $500,000  $17,831  $19,728
 $750,000  $23,456  $25,930
 $1,000,000  $29,081  $32,204
 $1,500,000  $40,331  $44,752
 $2,000,000  $51,581  $57,300
 $3,000,000  $74,081  $82,396

Typical Auckland Fee is an independently researched average of rates from selected offices of Harcourts, LJ Hooker, Ray White, Professionals, Remax, Bayleys, Harveys, First National, Premium, Unlimited Potential. 

B&T Residential Sales Commission Rate Calculation  (GST exclusive)
On the first $300,000 of the purchase price* 3.95%
On the balance of the purchase price* 2.0%
Min Fee of $8000 + GST

Independently researched and audited by Chatfield & Co, Chartered Accountants May 2008.  Calculations include GST.

As you can see, with Barfoot & Thompson, on a $1,000,000 house sale the owner pays just over $29,081 incl gst.  As you can see, this is about 2.9% of the total sale price (not the 4% abovementioned). 

To put this percentage into perspective and compare it outside the real estate industry, many mutual funds, superannuation funds etc (investments you may have) charge a similar annual management fee on the total dollar amount you have invested with them.  Check the annual fees on your (relatively speaking passive) Kiwisaver fund and you’ll see what I mean.

Most property managers charge around 7.5% of the rent to manage your investment property.

Whilst many readers will argue (until the cows come home!) that real estate commissions are expensive, when you look at the percentages, they’re not that bad after all.  And if you do some thorough research and find an experienced negotiator to help sell your home, you might “feel” as if you’ve paid no fee because you received such great service and a mind-blowing price.  Isn’t that what you’d expect for, say, $29,081?

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Pump on Pre-Pay. First impressions do count!

Posted by Steve Koerber on February 15, 2009

When I fill my car with petrol I’m usually reasonably well dressed. My car’s not shabby either – an understated but nice looking Subaru Legacy sedan.bp

I don’t know about you, but I quite like the fact that I’ve never pre-paid for my petrol. Not even late at night.

The thought of pre-paying gets up my nose. I understand why service stations need to enforce it, but I would find it all rather inconvenient.

Last week I asked the cashier why he didn’t make me pre-pay. He just smiled. I then asked him how he chooses the customers that must pre-pay.

I guess the answer was always going to be quite obvious. Scruffy types in older cars that “might” be a theft risk.

It got me thinking about how important “first impressions” are and how often people consciously or sub-consciously judge you.

If first impressions are powerful enough to put you either in or out of the “potential thief” category, imagine how important it is to get your home looking, smelling and feeling fantastic when you’re trying to sell it.

First impressions do count.  Bigtime!

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Steve’s Top 5 Selling Tips

Posted by Steve Koerber on January 10, 2009

In order of importance:

1.  Select the right agent.  Any agent can list your home, but few can sell it with a minimum of fuss and a level of expertise that matches the fee they charge.  Trust, negotiation skills, ability to listen and local knowledge are more important than most vendors realise.

2.  Get the price right from day one.  Match your circumstances and your home to the correct method of sale and you’ll win every time.  If your car is worth $20,000, would you advertise it at $35,000?

3.  Get the presentation right.  First impressions can make or break a sale.  Homes with major negatives will sell if a buyer feels good once they’ve been inside.

4.  Get the marketing right.  You can’t sell a secret.  Great photography, a guided video tour, upgraded internet listings, large print ads, an eye-catching sign, a great heading, tempting copy…or a buyer your agent met yesterday at another listing?  Appropriate marketing doesn’t cost, it pays!

5.  Tap into a large pool of buyers.  If marketing doesn’t find your buyer, a large network of agents and buyers probably will.  Boutique agencies rely heavily on marketing.  A major player like Barfoot & Thompson will always recommend marketing – then add value with the largest buyer/agent network in Auckland.

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How do you sell in a buyer’s market?

Posted by Steve Koerber on January 9, 2009

I realise that most people reading this blog are currently neither buyers nor sellers of real estate in Auckland. 

However, if you are considering buying at the moment, I envy you.  You have plenty of choice.  If you’re clever and well researched you’ll make a safe purchase.  Like all long term residential property owners in Auckland since the 1950’s, you’ll probably achieve a similar long term return and be glad you bought when you did.  Trying to time the real estate market is a mug’s game.  For long term success, the most important thing is to play the game and get into it.  

If you’re a seller, you might be wondering whether it is a good time to sell.  The answer is simple.  If you need to sell, you should.  If you don’t need to sell, it might be best to wait for a while. 

If you’re currently on the market and you don’t need to sell, your home is probably priced above the market.  A positive outcome is that you’ll be helping those who need to sell, to sell.  Because a real seller’s price will look better than yours, buyers will be drawn away from yours to theirs.

So, if you really want to sell, should you simply price your home low?  Should you set a price then drop it regularly until you sell?  I believe the answer is no!

Recently I’ve helped many real sellers achieve good sales (within a 4 week time frame) by not pricing their homes at all.  How have I done this?

Instead of telling potential buyers what they should pay for a home (ala having an asking price), I’ve simply asked real buyers to nominate what they would be prepared to pay.  I’ve then shared their opinion with others who have expressed interest.  By sharing this valuable information amongst a group of people that have all expressed interest, I’ve been able to A) sell the home to the keenest member of the group, and B) convince them to compete with other like-minded people within the group. 

At the right price level you’ll always find a buyer, or two or three or more.  I love the “no reserve” auction concept as the purest and quickest way to establish a property’s market value. 

A “no reserve” auction is a little scary for most sellers to seriously contemplate.  However, if done right, with appropriate marketing exposure and hype, it’s actually a pretty safe bet for sellers who really need to sell.

If your’e a little less adventurous you can always try a standard “reserve auction” and maintain a bit more control over the sale price.

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House Sales Plunge? For some perhaps…

Posted by Steve Koerber on September 9, 2008

Wednesday 10th Sept 2008 this headline appears House Sales Plunge.  Read the story.

I’m not avoiding the situation but I do want to shout from the rooftops about my recent success – during such a “supposedly” challenging period.

In August 2008 I sold seven properties!  It was (by far) my best ever August in the 12 years I’ve been selling real estate.  Five of those sales were auctions, all with multiple bidders, one with six bidders.

I calculated that so far in 2008 I have sold 1 in every 15 homes that have sold in Remuera.

On 10 September 2008 I had three auctions.  Two auctions sold above owner’s price expectations.  One was negotiated and sold to a new bidder the next day after interest from multiple interested parties.  Congratulations to all owners, especially Maree and Derek 🙂 who are relieved that I have updated this post to include their sale.

Auction 1 had 8 bidders, auction 2 had 3 bidders, auction 3 had 4 bidders.  That’s 15 buyers for 3 properties!

If you’ve heard that the market is no good for selling and that auctions don’t work, you’re listening to the wrong people. 

If you know anyone who wants and/or needs to sell in this market, look at my results, I know how to sell houses.  Get them to give me a call.

Posted in Selling your home | Tagged: , | 1 Comment »