Warren Buffet has been quoted as saying that when the tide goes out, you can see who is wearing pants or not.
We have seen seven strong years of an upward-trending market. For various reasons, (interest rates rising, wages not keeping up with inflation, changes in tax deductions on real estate), various markets and certain price points are noticing a downward pressure. When this happens, your business habits are exposed.
Here is what I mean by that…
1) If you have gotten out of the habit of prospecting, you are going to get exposed.
When a marketplace changes, the gross and net numbers change. Two years ago, if you took 10 listings, 8 or 9 would sell. In the current market, if you take 10 listings, maybe 6 will sell. Motivation and price become paramount. That means I am going to have to go through more leads to find the people that are motivated enough to do what is necessary to get their property sold (read lower the price). This requires consistent, regular prospecting.
2) If you have gotten out of the habit of prequalifying every single appointment with probing questions around motivation, you are going to get exposed.
When a market is experiencing downward pressure, the name of the game is to find sellers who have a compelling reason to sell. These compelling reasons are typically life events (ie death, divorce, job relocation, birth of a baby, retirement, etc). Motivation fixes price, so if you are not prequalifying to discover the specific reason why a seller wants to sell, you are going to end up with a lot of listings in inventory that are not selling.
3) If you have gotten out of the habit of practicing your skills, you are going to get exposed.
This is 100 percent a skill-based business. When a market shifts, the difference between skilled agents and unskilled agents becomes pronounced. Honing your ability to set appointments, handle objections, present price, prequalify, perform a listing presentation, present price and get price reductions are your tickets to success.
4) IF you have gotten out of the habit of saving money, you are going to get exposed.
Agents are notorious for upgrading their lifestyles when times are good. So in other words, they raise their fixed expenses by buying a bigger house and fancier cars, etc. This becomes a problem if their income drops by 20-30% based on market dynamics. Having 6-12 months of liquid capital and low, fixed expenses become a major asset during market corrections.
Leaders do not react… they anticipate. Anticipate change and make sure you have the right habits required to be successful in any market.