How can brokers improve listing absorption rate, and what types of tools and measurement devices are required to accomplish this?
One of the mistakes that real estate leaders make is in failing to track, and then holding agents accountable to ‘Listing Standards.’ Listing standards vary, but generally relate to both productivity standards and culture.
As has already been established, the impact of unsold inventory is stark. Awareness of this fact creates a compelling case for managerial control through employing listing standards.
- What are your standards for skill development, listing presentations and pricing adjustments?
- Are your agents accepting listings priced within +/- 5% of the price indicated in a comparative market analysis?
- Are your agents highly skilled at delivering the value of your company tools and services in a listing presentation?
- Are your agents bringing listing terms of at least 6 months in duration?
- Are your listings easily accessible and well staged for marketing?
- Are your agents making sure properties are well positioned on the appropriate Internet sites with ample numbers and quality of pictures and video included in all postings?
If the answers to these questions are unclear in your mind, the associated loss in revenue is likely far greater than you might ever expect. When I managed real estate offices, there were listing standards for all points mentioned above, and my signature was required before a listing could be processed.
Aged Active Listing Report
An Aged Active Listing Report is a management tool whereby the entire listing inventory is viewed with key data for each listing, including days on the market (DOM) and price reductions taken by the listing agent(s). This tool enables a business leader to directly measure sales agent proficiency in attaining price reductions while indirectly gauging effectiveness in listing presentations and pricing presentations. That knowledge, in turn, empowers the branch leader to construct coaching and training programs designed to reinforce the needed listing skills.
One possible view of an Aged Active Listing Report is offered below.
Integrating Listing Absorption into the Company Culture
Finally, a good way to positively reinforce this concept is to tie absorption, price adjustments and time on the market to things that agents need and/or want. There are many ways to support a good Listing Absorption Rate, including but not limited to the following:
- Visibly displaying individual agent achievement by highlighting price reductions on the office production chart
- Creating monthly office “Listing Absorption” awards or incentives
- Establishing minimum absorption rate in order for agents to qualify for company-generated listing leads
- Establishing contests whereby agents who list and convert listings within a specified time frame are recognized, and
- Granting ‘marketing dollars’ to agents who achieve specific absorption levels
Be sure to check with your local MLS, Boards of Realtors® and State regulators in order to assure compliance with all applicable laws and regulations concerning contests and rewards.