099: Navigating Client Conversations: Communicate Your Value with Confidence and Clarity with Lynn Madison: Part 2
Description
Please Note: Since the recording of this episode, NAR entered into a proposed settlement agreement that would end litigation of claims brought on behalf of home sellers related to broker commissions. To learn more, and to prepare for the practice changes taking effect August 17, 2024, go to facts.realtor.
Welcome to Part 2 of my conversation with Lynn Madison! Today we are talking about different business models. As you refresh your presentation of what you do and what you charge, we want you maybe to consider some other options or, at least, some other parts of the business and we also want you to be aware of the possibility that somebody else might have a different business model; how are you going to be prepared for that? Go back to episode 098 to hear the start of our conversation on clearly communicating your value to your clients. Lynn Madison has received the REBAC Hall of Fame Award, the REBI Distinguished Educator Award, and Educator and REALTOR® of the Year, both from the Illinois Association of REALTORS®. She is also one of the primary authors of the ABR® designation course and we are thrilled to have her back with us again. We will link to the other two episodes where Lynn has been with us, in the show notes.
Welcome back, Lynn Madison, for Episode 2!
[2:25 ] So we just want to talk about maybe some of the different ways people can get paid, maybe some challenges we see, and what we hear from people talking about business models.
[2:45 ] Your business model must be something that is allowed in your state. Your menu of services must not include options that are lower than the minimum services that the license law requires you to give.
[5:05 ] Competition.REALTOR (now facts.realtor) lists tasks you perform for clients. Are they in your business model? Lynn says your business model is what you deliver but be consistent. She talks about when inconsistency hurt her.
[7:44 ] If you provide different levels of service, have the client check and sign on a written document what level of services they are choosing, so there is no confusion or anger later. Be very clear about it.
[8:37 ] Lynn has a pledge of performance. In it, she offers her full level of service to every client. If she offered less service to some, she would need a separate pledge of performance for that level of service.
[10:07 ] Lynn teaches about six buckets: finding a suitable property, showing property, analyzing the market, writing a reasonable offer, negotiating the offer, and following the transaction through to the closing.
[10:47 ] People don’t like to lose out. When you have a buyer sign a Buyer Representation Contract, you move the buyer from customer-level service to client-level service. Lynn explains what that means by law.
[14:50 ] You’re going to want to have this Buyer Representation Contract signed with a compensation amount in it. You’re going to have to figure out how to talk about compensation with your buyers.
[15:33 ] Stop being afraid of talking about compensation. Explain what it is you do to earn the money you are making. Nobody works for free.
[19:34 ] Study in the last 18 months in your market, how long it took you to find a property for your buyer. Tell your client, in this market, it takes about four to six months to find a house. Would that fit your plans?
[22:54 ] Follow your state law regarding the contract and protection period. What if they buy something after the contract that you showed them? If the contract period is long, there must be an opt-out.
[26:52 ] Lynn wants to give her buyers premium-level services but if the buyer finds a house in two weeks instead of six months, that’s a good place to offer a menu of services. Also, Monica tells why this podcast episode is not an antitrust violation conversation in the discussion of business models.
[29:27 ] You can use a free Zoom account to meet with buyers, especially if out of town. Share your screen with them. Tell how they will be notified of new listings in MLS and other features and statistics.
[31:10 ] Statistics of days a home stays on the market can show the urgency of making a move to buy a home. You can show these electronically or on paper. NAR resources linked below can help.
[32:43 ] Lynn takes NAR resources and personalizes them for herself to show her clients her pledge of performance of what she will do for them to get them the right property at the right terms to the closing.
[34:40 ] How Lynn deals with appraisal disagreements.
[35:41 ] In this hour, Monica and Lynn have shared some of what they teach in the ABR® class. Be sure to take the ABR® designation, with Lynn, online, or locally.
[36:49 ] “If you’ve not read the book, Who Moved My Cheese?, get it and read it. If you think about what we’re going through, it helps you realize that you’ve got to change your mindset.”
[37:52 ] Monica thanks Lynn Madison. She gives us so much great information! What is your takeaway from this conversation? Can you bring some points back to your team or brokerage firm?
[38:05 ] Please share this podcast with your fellow agents. I am learning all the time and I am talking with some very well-trained and thoughtful educators. They want to help you and the people that they train to make the transition that needs to be made. Please share this as a resource for this time.
[38:31 ] The Center for REALTOR® Development offers excellent training and you can find live, live virtual, and online courses, designations, and micro-courses. Check out the ABR® offerings and the SRS offerings locally or at Learning.REALTOR.
Tweetables:
“Your business model cannot be something that is not allowed in your state. Some states have, for example, Minimum Services. If I have an exclusive agreement with my client, whether it's a listing or a buyer, I must give them a certain level of service.” — Lynn Madison
“I’m at a loss as to understand why a buyer would want to go [without representation]. But part of the problem is we haven’t been having these conversations with the buyers.” — Lynn Madison
“You’re going to have to figure out how to talk about compensation with your buyers. All of this ties back into your value proposition.” — Lynn Madison
“If you’ve not read the book, Who Moved My Cheese?, get it and read it. If you think about what we’re going through, it helps you realize that you’ve got to change your mindset.” — Lynn Madison
Guest Links:
Madisonseminars.com
080: “Talking Buyers, Contracts, Value, and Fees with Lynn Madison”
NAR Resource Links
ABR® Accredited Buyer’s Representative
SRS Seller Representative Specialist
Additional Links:
Microcourses found at Learning.REALTOR. Use the coupon code PODCAST to obtain 15% off the price of any microcourse!
Learning.REALTOR — for NAR Online Education
Training4RE.com — List of Classroom Courses from NAR and its affiliates
CRD.REALTOR — List of all courses offered
Host Information:
Monica Neubauer
Speaker/Podcaster/REALTOR®
United States
