An Interview With Bernice Ross, Real Estate Coach
I have written about Bernice Ross before, and hope to have the opportunity to do so again. Bernice is a committed coach, who finds the difference she makes in people’s lives to be the most pleasurable aspect of her vocation. That’s the guy (lady) you want to have in your corner. While she was grounded (Bernice spends most of the year on the road) this past week, I was able to pin her down for an interview, in order to talk about her perspective on the apparent changes in the real estate market, and what agents can do to prepare, and succeed.
The insight she provides is not only clear, but appropriate. And, it seems that we are not the only ones jockeying for time with her; just last month she was interviewed for a Leslie Stahl story with 60 Minutes.
The following interview was conducted in a very informal manner. To maintain the intention and integrity of Bernice’s responses, I mostly used her unedited responses, word for word. It should be read as a conversation, from the hip.
Bernice L. Ross, Ph.D. and CEO, www.RealEstateCoach.com
Author, Trainer, and Speaker, Bernice Ross couples her expertise as a Master Certified Coach with over 25 years of real estate sales experience.
From 1993 to 1997, she served as Executive Director of Training for the Beverly Hills based Jon Douglas Company.
With over 250 published articles to her credit, Bernice also writes the weekly agent column for Inman News Features who dubbed her “America’s top real estate coach.”
Her two books, Who’s the Best Person to Sell My House and Waging War on Real Estate’s Discounters, provide a road map for agents who want to earn full commissions by providing outstanding customer service.
You can also visit Bernice’s Luxury Real Estate Blog at www.LuxuryClues.com.
JIM: What have you seen being the most notable change in the Real Estate Market over the last 10 years?
BERNICE: Specifically, the biggest change is the consumer having access to the Multiple Listing Service, to house value data and to educational information on the web. Consumers are hungry for information and this has affected the way we are getting clients. The biggest shift for 2007 is the shift from paid to free advertising. For example, 3 lines in the newspaper can cost 30 dollars. Now you can post your listings on dozens of websites for free, using handsome HTML templates. – In fact, there are even companies like foreclosure.comthat will actually pay you a 25% referral fee for helping them sign people up for their $49/month program that provides consumers with lists of foreclosure listings. This advertising model may be the beginning of a dramatic shift in real estate advertising.
Jim: So it’s the hunger of the consumer for access to data that has made their expectations different.
BERNICE: In the past, age didn’t make much difference in how we communicated with our consumers. Today, there is a huge gap between those who are over 35 and those who are under 35 in terms of how they want to receive property information. Older clients prefer email and telephone. Younger clients demand texting.
A major challenge is that the real estate industry is more or less a “gray” age group with the median age being 54. What’s happening is that the majority of Realtors are not really grounded in how their younger buyers and sellers want to receive information. There is a big divide in terms of age right now- and that is one of the hot things that needs to be addressed in 2007: “How am I going to deal with this age difference?”
Another element that cannot be overlooked is that minorities and immigrants now account for a large percentage of our buyers and sellers. The number of so-called traditional clients has been shrinking. In fact, the old standard is becoming the minority.
JIM: How has your business changed along the way?
BERNICE: In the late 1990’s we tried to sell coaching without training. Today, the niche that has the greatest demand is training that includes integrating technology with traditional marketing techniques. An important issue for 2007 is how to integrate your internet presence with your traditional marketing techniques to make both more cost effective.
JIM: What topics does your audience most want to learn about? Or rather, what do they feel they are lacking most?
BERNICE: Blanche Evans from Realty Times once told me that what Realtors want to know most about is marketing, prospecting, and how to make more money. When I write my columns, I always have my eye on those three things. It’s the nuts and bolts that will make agents more profitable. Using the proper technology will make their marketing not only more efficient it will also make it more effective.
In a slower market, where there are going to be fewer transactions, the way that you can keep my net income the same is to cut your expenses. Cut back on advertising dollars by taking a more web based approach, for example. Starting a blog and the obvious benefits of that far outweigh much costlier traditional techniques that are losing their effectiveness. Embracing the advertising opportunities that the proper technology presents is the key.
Rather than spending your money on expensive personal marketing programs, concentrate on using technology instead. Technology can even the playing field; I can compete with Coldwell Banker online, but I cannot compete with them when it comes to traditional advertising.
JIM: Who is your typical client?
BERNICE: That’s an interesting question: Those who hire me to speak either own companies or manage offices. I wrote the concierge program with Coldwell Banker, I spent 6 months doing a consulting contract with Gary Keller, and more currently have been working with Realty Executives, and Long and Foster. What really launched my business was my book, Waging War on Commission Discounters. That book was about how we can defend our commissions, given all the so-called alternative business models.
My current clients hire me to analyze and consult them on how to embrace the new technologies. With the market slowing in many areas, those agents that have been working for less than ten years have never seen a flat or down market. They don’t have the necessary dialogues. For the last few years, they haven’t had to really work or worry about how to market a property.
The one message I would give to your readers: Now is the time to get trained! Get trained on the basics. Avram Goldman from Coldwell Banker Northern California summed it up well when he called today’s market a “Realtor’s market; where you need real skills.”
JIM: What’s the one thing that you would recommend to someone starting out in Real Estate that would help them succeed?
BERNICE: Get trained on the basics of being in real estate. First of all, there are going to be more expired listings and more for sale by owners who will list with an agent. There is tremendous opportunity there.
The other thing that one needs to master is market statistics dialogue – Its one of the things I have trained since the late 80s’ and it’s extremely effective. Most of the dialogues that I train are based upon the numbers.
When you walk in and you say to a seller, “Mr. and Mrs. Seller, we have 12 months worth of inventory on the market – Right now that means in any given month you have a 8.5% chance that you are going to sell. You have a 91.5 % chance that you aren’t going to sell. That means that each month the properties that are selling are in the top 8.5% in terms of value, the other 91.5% are going to continue to sit on the market. So where are you going to position you property in the market place?” The sellers must determine whether they are going to stage the property.
Furthermore, are they going to price it competitively? Those are decisions that the seller is going to need to make. However, you need to give them the data in order to let them make the smart decision.
JIM: So you would recommend that they get training on how to speak to both Buyer and Seller, not just give them the facts?
BERNICE – That’s right and we have 220 scripts on audio CD…[laughs…]
JIM: We’re here help plug you shamelessly, no problem there.
BERNICE: Well. were out there plugging you (The Real Estate Tomato) on the circuit as well. I’ve told my audiences that if you are looking to blog in the Real Estate Industry, Jim is the best resource to learn how to do it.
JIM: I can’t thank you enough.
JIM: What’s the favorite thing about your career?
BERNICE: I really love being able to get out and meet with people – It is hard being out on the road, but what makes it worth it are the great people out there who are really making a difference and providing great service. I do like writing and the speaking, but it is being out there and being of service that keeps me excited.
JIM: What’s the most challenging thing about your career?
BERNICE: I’d have to say that the least favorite thing to me is the trip from the arrival airport to where my final destination is… figuring out where I am going, or how I am going to get there.. the grind on the ground after the flight… it’s wearing. Scratch all that… it’s really the fact that I am getting fatter from all the good food I eat while I am out on the speaking circuit. [laughs…]
JIM: Many bloggers defend the role of the Realtor as being an ultimately necessary part to the real estate transaction. Do you feel that Realtors are at any risk of disintermediation?
BERNICE: Nope, Absolutely, positively, no way. The reason is that all of these new business models make the same mistake… They think that the website is a substitute for human connection. Look at all the activity on social networking sites. People want to be connected. They are connecting online – And when it comes to down to that all important decision of where they are going to live, they still want that face-to-face contact. They still want to work with a person that they can trust.
The idea of being a trusted effective advocate is one of the real hallmarks that will always make the difference. There will always be the small percentage of individuals who buy on price or who may even buy online – But when we look at people from all over the world, when they find a home they want to buy, they will still get on an airplane and hook up with a Realtor to go and see the property in person. And this includes the ultra rich. Everyone wants human connection.
JIM:Playing Devil’s advocate… Dealing with the under 35 crowd is different… is there not some threat to the full service that a Realtor provides?
BERNICE: With the slowing market, sellers really need to work with someone who understands the market. In some areas. people are paying more than full commissions to get their house sold because that what’s today’s market requires. In fact, I was just interviewed by 60 minutes about 10 days ago for a story that Leslie Stahl is doing on commissions.
JIM: Currently, the most visited real estate blog to date is the fear mongering HousingPanic, which o nly focuses on the glass being half empty for the national real estate market.
What’s your take on all this housing bubble talk, and what affect (if any) do blogs like HousingPanic have on the current market?
This whole idea, that if it bleeds it leads – is there some sort of self fulfilling prophesy going on here that is having any kind of effect on the market?
BERNICE: People are kind of blase about the bubble because it has been talked about so much… what were seeing is that the market is spotty. This fall I heard an economist speak at a conference, and what he said is that he felt that the Fed had over corrected in terms of interest rates. It takes about 8 to 12 months for the ripple effect to make its way through the system. He believes that rates will be down next summer. He also said that as long as corporate America stays strong, we won’t see a recession. That’s barring of course, that we don’t have another 9/11 type of event.
What’s going on right now is that people are standing back and waiting to see what the market is going to do. My response to that is that you have to look at the long term history of real estate – even in places like Florida where they had as much as a 30% decline in terms of valuation – the market is making an adjustment – all markets adjust. According to noted economist Don Reynolds, you can tell where there’s going to be a major market adjustment. Here’s how to spot it. You look for what he calls a “parabolic curve.” If there has been a big run up on prices, you will have one of two reactions. The first is that the market will flatten and stay there. The other is that there will be a big dip before the market rebounds and starts to appreciate again.
Sites like Housing Panic are driving traffic based on fear. It’s too bad, but sex and bad news are what sells. The ironic thing is that if you are interested in the market and are buying, you want a bad market. The message I have for Realtors and your audience, is that if you are thinking of “moving up,” you want a bad market. That’s in your favor. You don’t want to be moving up in a sellers’ market. If you sell your current home for 30% less of its former value, but are able to move up to a home worth much more, and acquire it at a 30% discounted value, the swing is in your favor. Let’s say you sell your home that you paid $300,000 for. Assume you sell it for $240,000, and move into a home that used to be worth $400,000 , but is now worth $320,000. You have just turned a $60,000 down turn into a $20,000 upswing. Your mortgage payment and taxes will be less all the way through your ownership too.
JIM: What’s your favorite RE blog? Besides mine… laughs:
BERNICE: Oh, the Real Estate Tomato is my favorite real estate industry blog.
I really like The Realty Gram and The Fat Lady Blog – both by Frances Flynn Thorsen.
I also like the Inman Blog, but don’t get as much of an opportunity to read blogs as I would like because of the amount of time that I spend on the road. If you could point me in the direction of the cream of the crop as you see it that would be great. [Here you go: The Tomato Blogroll]
JIM: Thank you so much for your time today, Bernice. Our readers will love the information you provided, it is such a pleasure to have the opportunity to get insight from someone so in tune with the industry itself.
BERNICE: It has been my pleasure. Now let’s get you out on the circuit!