How to Never Get the Commission Objection Again
In the wake of the NAR settlement, you’re probably asking yourself this: “how do I justify my full commission?” The reality is, while it feels like everything has changed, nothing has changed.
Commission objections and discount brokers are nothing new.
And when you think about it, you can’t justify a price in any industry—real estate included. In fact, nothing in the world is based on price alone.
Companies, products, and services are judged on value. Building a valuable brand isn’t just about selling; it’s about having the heart of a teacher, not a salesman.
Think of it like this: why do people pay more to stay at a 4-star hotel than a 2-star hotel? They’re both hotels, yet when someone checks into the higher end hotel, they don’t expect to get their room for the price of the lower end one.
That’s because rather than wasting time justifying their price, the 4-star hotel has already established the value of what they offer-comfort, attentive service, and a seamless and enjoyable experience.
Price Versus Value
Just as every product or service has a price, it also has a perceived value, and that value will determine what people are willing to pay.
Going back to our hotel example, if you check into a 4-star hotel, you have certain expectations, including valet parking, someone to carry your bags, concierge service, people who wait on your every need, etc.
But if you check into a 2-star hotel, you realize that you’re parking your own car, carrying your own bags, making your own entertainment plans, and fending for your own needs. There’s nothing wrong with this, but it is clearly a different experience. Our industry is no different.
Do your clients want to “fend for themselves” during the purchase or sale of their home? Probably not. But they may not realize what this means. That’s where you come in. While a discount broker may offer to sell someone’s home for a lower commission, chances are they don’t offer the same value that you do.
Will the discount broker meet the appraiser at the home? Will the discount broker do research on the three houses that sold most recently that are most like the clients to help the appraiser? Will the discount broker dig deep into a “comp” with a lower sales price to uncover it was a sale between family members with different last names?
Probably not, since those are value-added offerings.
Value beats price every time, so when clients understand the value of what you offer, price is never an issue.
Why Knowing the Housing Market Matters
To truly establish your value as a real estate agent, you must be intimately familiar with the housing market. You are not just a salesperson; you are an educator. Clients rely on your expertise to guide them through one of the most significant transactions of their lives.
Being knowledgeable about the market allows you to anticipate trends, provide valuable insights, and ultimately empower your clients to make informed decisions.
When you can explain market dynamics, pricing strategies, and neighborhood nuances, you instill confidence in your clients, reinforcing the value you bring to the table.
Identify Your Value
If you follow the Needs-Answers-Resources sales approach, you know that you must have a value proposition for both your company and yourself. By value proposition, we mean a reason why someone should choose you or your company over everyone else.
Then, you present that value proposition after you uncover your clients’ true needs and educate them on the high-level answers to those needs.
But how do you know what to include in your value proposition to set yourself apart and make cost irrelevant?
Here are some points to consider:
Communicate Your Personal Value
Just as you differentiate yourself from other agents, you need to highlight the unique value you bring to the table. When you’re at a listing appointment or working with buyers, it’s about aligning your specific skills and areas of expertise with the needs and desires of your prospective clients.
If you can prove upfront that you are more valuable than someone else, no one will ever question your commission again. Some things to consider that may set you apart could include:
- Your in-depth knowledge of the housing market and ability to explain market trends and what that means for your clients.
- Your personalized approach to client education, ensuring they understand every aspect of the buying or selling process.
- Your commitment to staying updated on industry news, regulations, and best practices.
- Your negotiation skills honed through specialized training and experience.
- Your proactive communication style, keeping clients informed every step of the way.
- Your dedication to going above and beyond for every client, ensuring their needs are met and expectations exceeded.
No matter who you are or how long you’ve been in real estate, there are unique qualities and skills that enable you to stand out from other agents. Pinpoint the essence of what makes you invaluable and showcase it prominently.
And remember above all else, consistency is the most important strategy when it comes to proving value. Consistency is what builds trust. Trust builds credibility. And credibility is the foundation of every successful business.
Your Full Commission… Every Time
Commission is never based solely on price. It’s based on the unique value propositions you offer as an individual agent.
The more you differentiate yourself from the competition and position yourself as an educator rather than just a salesperson, the more value you’ll be able to offer your clients.
With your value clearly defined and communicated, you’ll never hear the commission objection again. To get content that proves your value every day, try Keeping Current Matters today. Start a 14-day free trial for marketing materials that prove you’re the expert to work with every time.
