I do believe in Private Inspections
Quick Update on the market
It feels stronger and more positive than at the end of last year.
Are you calling a change of direction, Mal? Nope, not yet. Why not, Mr. Gutless?
Three reasons:
- I, like all other short-term market predictors, equally suck, and the main difference between me and the economists is I know I do.
- February pep: Every year straight out of the blocks, the market experiences a perceived lift, real or not, as nothing has happened for 6 weeks. It’s like us when we haven’t had love for a while; any kind of activity feels good, even when it’s not much. Hold on, Mal, how did you get sex into a market report? But I digress.
- The third reason I am not calling a market change yet is because the market goes up and down on a weekly basis. Overall, we have been in a falling market since Cup Day 2021. However, during this time, we have had little bursts of positivity in 2023M1 and 2023M2 – in other words, from February to June of last year, the overall market went up, as sentiment rose, Bidderman increased, and clearances improved until Spring when the air cooled again, and the market balloon gently lowered for a while and then came down hard just before Santa.
Enter 2024, talk of no rate increases, talk of possible falls, probably a year of steady as she goes, but who knows. Anyway, enter 2024, and as a Top-End collective, the world feels a better place with a lot more people through opens, sellers increasingly coming to market, and agents busying up so much; they do not have time to lament their world.
TIP: The most reliable market indicator of market direction is not Reserve Bank data or CoreLogic Clearance Rates; it’s us agents, we are so shallow that you can read the market, 100% accurate, every time, never fails on our demeanour!
Currently the signs are positive and yay. But let’s see how the Opening Market 2024M1 begins in 2 weeks, February 24th, with the start of our first 100 auction test for the year.
I do believe in Private Inspections
And onto the second article on Open versus Private Inspections.
Last week, we discussed OFIs and I’m not about criticizing OFIs more so than emphasizing the superiority of Private Inspections.
Yes, OFIs have their place.
Give me an average agent with OFIs, some internet support, and an auction, compared to an poor agent with no media, no database, an off-market campaign and no initiative for private inspections AND OFIs consistently outperform in terms of selling your home and securing a better price.
But give me a quality agent and a private inspection great database process (with good socials and ok some realestate.com.au etc), and nine times out of ten, it’s a better deal for everyone involved.
But Mal, one thing that’s been troubling me is how does an agent fit the 75 people who attend the open for inspections into 75 separate one-hour private inspections?
The answer? Your agent doesn’t.
Let’s break down why your primary agent shouldn’t engage in blanket OFIs:
- Average number of “buyers” at OFIs in Top End Melbourne on a good home: 75
- Average number of bidders on Top End Melbourne homes: 1
- Average number of non-buyers agents have to deal with: 74
Now, consider:
- Average number of campaigns an agent works on: 6
- Average hours per week an agent spends in face-to-face interactions with buyers after accounting for training, meetings, presentations, and other commitments: 4 hours a day, 6 days a week, totaling 24 hours
So, with 6 campaigns and 75 buyers each, that’s 450 interactions, which translates to roughly 3.2 minutes per buyer.
Factor in missed calls, call-backs, and emails, and your agent might only have 2 minutes per contact for the week.
What can you do in 2 minutes – don’t know about you, but I can’t even finish thinking from my last whatever, to focus on the 2 minutes I have with the current person.
And this is a $4million transaction….. your $4m transaction and you have the junior burger on your open or your Big Mac is brain dead from all his or her contacts.
Before we continue, Mal, it seems your argument is based on the premise that time with an agent holds value.
My friend, I agree that two minutes with an agent handling hundreds of interactions weekly may not seem valuable.
So, what does truly hold value when dealing with an agent?
Think back to moments when your parents, teachers, mentors, friends, or spouse devoted 30 minutes, even an hour, solely to listen to your concerns on a single subject, offering uninterrupted feedback. Wasn’t that invaluable to you?
Imagine if agents could dedicate 30 minutes to you, as you’re genuinely interested in a property. Wouldn’t that be valuable for both you as the buyer and their selling client?
Let’s delve into the math of private inspections.
I attend few training sessions, skip corporate meetings, limit work/social engagements, and avoid routine listing calls. Moreover, I’ve learned that working 15-hour days, while once believed necessary, was unwise. Currently, I devote around 4 quality face-to-face contact hours daily, six days a week.
That amounts to 24 quality contact hours weekly. So, if I manage six “campaigns,” I allocate about 4 hours per week or 4 quality contacts per campaign, per week.
This approach mirrors that of top-quality agents like Rob Fletcher, Sarah Case, Marcus Chiminello, Stefan Whiting, Andrew Sahhar, Walter Dodich, Sam Wilkinson, Peter Vigano, Mike Beardsley, Jen Dwyer, and fellow time traveller Warwick Anderson. When they handle six campaigns a week at their best, they focus on key contacts for up to an hour each, rather than dealing with hundreds of brief interactions. And it’s evident that their success, as well as that of their clients, speaks volumes.
When operating optimally, they engage with 20 to 40 people per week, not 450.
In a quality 30 minutes to an hour spent at a property with a serious buyer, an adept agent can achieve a lot. For instance:
They can direct the buyer’s attention toward your home.
Conversely, another adept agent conducting a private inspection on another home can divert your buyer’s focus away from your property. And remember the magic number at the Top End is 1. So now, 1 minus 1 = 0 on yours and 1 +1 = 2 on the other agents home.
Mal, this notion is nonsense. Buyers don’t require all this.
I’m sorry to disillusion you, whether you’re Ms. Tech-head or Mr. Impersonal, but buyers indeed crave this: meaningful connection. They don’t need another fancy app, sophisticated algorithm, or internet exclusive… pretending personal connection. They actually need personal connection.
Just as they don’t need another tech gimmick pretending to be a genuine human interaction pushed by big corporations like Apple, Google, or Facebook.
What’s wrong with an real-life genuine human interaction instead of a simulated one?
The solution to great selling lies in personalized experiences. That’s precisely what an exceptional agent provides to discerning buyers—a tailored, personal experience.
I’ve spent countless hours with buyers, exploring thousands of properties. Many times, we’ve discovered and purchased a home that our buyers hadn’t considered before, sometimes being the sole interested party – all this despite the internet, social media, blanket emails and …….
This is a relationship-driven transaction, something an algorithm cannot replicate. Deep down, buyers, sellers, and even agents seek connection, and that’s precisely what a private inspection facilitates and an OFI does not.
When the average number of buyers on a Melbourne Top End home is 1 and when you have 1 less you have none and when you have 1 more you have competitive bidding pushing the price up, then your agent’s ability to secure, a or another, 1 buyer is paramount to a successful deal.
Some reasons I like Private Inspections.
- Exclusivity and Privacy
- For Sellers: It ensures that only serious and qualified buyers view the property, maintaining the seller’s privacy and security. This is such a foreign concept – when you let 100 “Tom, Dick(head) and Harriets” through your home, you put 100 BS opinions out there into the marketplace. Dumb!
- For Buyers: Offers a confidential viewing experience, away from the prying eyes of the general public. Buyers like respect and time and privacy. I mean do you when you are buying? Then why not insist on this when selling!
- Personalized Attention and Reduced Stress
- For Sellers: Eliminates the stress of having large groups of people walk through their home at once, which can be especially important for top-end properties that may contain valuable items.
- For Buyers: Provides an opportunity to explore the property at their own pace and ask detailed questions in a pressure-free environment. Initially emotionally, do you perform better under pressure or if you have the time? Auction competition is a real thing – but only once buyers are emotionally committed.
- Flexibility
- For Sellers and Buyers: Scheduling is more flexible, allowing visits to be arranged at times that are convenient for both parties, without the constraints of a scheduled open house.
- Quality of Enquiries
- For Sellers: Leads to higher quality enquiries (if qualified well) as those requesting private viewings are often more serious about making a purchase.
- For Buyers: Allows for deeper investigation and due diligence in a private setting, leading to more informed decision-making.
- Enhanced Negotiation Environment
- For Sellers and Buyers: A private inspection can foster a more personal connection between the seller (or agent) and the buyer, leading to smoother and more favourable negotiations for all parties.
- Customized Experience
- For Buyers: The ability to focus on specific features of interest and receive detailed information tailored to their preferences and questions. This is so important!
- For Buyers: Without the rush of an open house, both parties can take the time to focus on the details that make the property unique, especially important for luxury properties where nuances can significantly impact value and appeal.
- Market Perception
- For Sellers: A private inspection strategy can contribute to the high-end positioning of the property, reinforcing its exclusivity and desirability. Back to marketing control when you let 100 “Tom, Dick(head) and Harriets” through your home you put 100 BS opinions out there into the marketplace.
Real-life
We successfully closed deals for properties like 111 Sackville St for over $19m, 26 Kooyongkoot Road and Bay St Brighton, both exceeding $16m—all without open inspections. On the purchasing end, we acquired properties like 9 Towers Toorak and those in East Melbourne, each surpassing $20m, along with St Georges Toorak, twice, all without open inspections.
But it’s not limited to the top-tier market. Recently, properties like 18 Bellavista Glen Iris, 12 Adeney St Kew, and 34a Bowman Aspendale, each valued around $4m, were successfully transacted either on or off the market, primarily through private inspections.
If you’re buying or selling a home, regardless of the price, and your agent doesn’t prioritize exclusive campaigns of private inspections or actively support private inspections, how are they truly adding value?
With AI, admin support and the internet answering all the 2-minute buyer Q&As, what strategy and deep thinking is the person you are 1) paying and 2) entrusting your biggest asset to, actually doing that is making a difference to a buyer’s and seller’s end result.
Mal James
Buy Sell Agent
0408 107 988
mal@james.net.au
Every time as an agent, I have been to a home with a buyer, I have only been there for them, and I have had time for a coffee and talk afterward. I’ve provided them with a personalized report and followed up on how they feel, ensuring they’re cared for.
Buyers and sellers deserve this level of attention.
The best agents excel at private inspections and innovative thinking. Anything less, like an OFI is akin to a basic offering—it’s okay, better than nothing, but it doesn’t truly make a difference, like a great Private Inspection can.
