If that’s true, what is keeping you and I from spending every working minute on getting great at this very skill?
Tim and Julie Harris are some of the most well-known real estate agents and coaches in the entire industry and in this episode, we will learn the best-kept secrets that are working in today’s market to GET MORE LISTINGS!
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Today on the think bigger real estate show I am your host Justin Stoddart. I have with me today an absolute legend Hall of Famer in the real estate world. His name is Tim Harris. He’s an absolute stud. The guy has he and his wife, Julie. They created the the the probably the most prominent coaching program slash real estate podcast, real estate coaching radio. If you’re not familiar with it, you’re missing out. Tim Harris, thank you for coming on the show today.
Tim, you Thank you, and hopefully you won’t haven’t connected. Yeah, I can hear you. Can you hear me? Okay, there we go. Yeah, it was a little delay there.
We, we live in Puerto Rico. And sometimes the internet connection at the worst times it goes to hell. So there’s nothing I can do about it. So if your introduction, I appreciate it, we’ll do the best we can. Yeah, absolutely. Tim, hey, excited to have you here. Listen, let’s cut right to the chase agents don’t have a lot of time right now. They’re running around. You know, anytime they’re working with buyers right now, they’re facing dozens of competing offers. You and I both know that the best solution, although it’s still not an easy one is to be on a listing side, you interview the top agents in the world, you you’ve been that yourself, talk to us, what are the best strategies you’re seeing in this type market to get listings, when it seems like they are few and far between? I would like to start out with the simple cold hard fact that the buyer agent business model is going to is evaporating in front of all of us, because it really is and if you want to just see I can encapsulate that into a few micro points. The buyer agent, co buyer agent Co Op Commission’s are, are no longer an entitlement in many markets to the to the transaction. And the essence, the way it’s traditionally worked is the buyer agent represents the buyer, the seller pays the buyer’s agent commission, those things are going away in some markets completely, but in almost all markets even you know, the midwestern states that are don’t that operate years behind the coastal states, you’re still seeing that the buyer agent side commission is dropping less than 2% is normal now. And that’s gonna that trend is gonna continue. And what we’re dealing with is it’s a pendulum, right? So here’s the the bottom of the the, you know, the buyers market 2008 2009. Now, the pendulum swung all the way to the seller’s market, until it starts to basically balanced out again, which is going to be in next three, five years, things are just gonna get worse for buyer’s agents. So commissions are being depleted. But here’s the other thing it’s nobody’s talking about the number of new agents getting into the business is at a historic high. There’s more agents getting licenses right now more people that are going to be getting lice are getting becoming active agents over the next really six to 12 months. What were they doing during COVID? After they watched the Netflix after they put on their COVID-19? Then they all sat and got their pre licensing. And so all those people are coming to the market? And what do all agents told to do the second they get real estate licenses work for work with buyers. So you have a shortage of inventory, you have reducing commissions, you have increasing competition in some markets or competitions can be increasing by two 300%. You know, so the buyer agent business model effectively now because the pendulum swung all the way up here to the seller’s market until it starts gravitating back down towards the balance. When it goes back like right about here to right about here, you know even here, then buyer agent Commission’s will start increasing again, and all the rest of what’s going to happen. But for now, if you’re thinking you’re going to make as much money off you did off you up selling houses last year to buyers prominently, you’re going to struggle, you might actually do the same number of units, but your average commission per paycheck is going to be a lot less because the market forces that are happening. Again, not saying it’s the end of buyer agency am saying that the for the near term future starting this year, next year next year. That’s going to be a hard time if you’re not a listing agent, for sure. So your question is actually perfect, which is really interesting, because those agents are actually working harder than ever, right? They’re submitting a dozen offers to get maybe one accepted
per hour is you know, being a barista. Sorry. Yeah, you got to remember to not talk because there’s a little delay. You hit it out of the park foot, your sets and our book Harris rules and all of our coaching and all the things we’ve done for the last couple decades. We’ve always said that working with buyers is physical labor. It’s the opening of the doors, it’s the driving round you’re giving you’re selling your physical labor in exchange for hopefully real estate transaction on the listing side. It was mental labor. You could do most of it on the phone. You could do most of it just with an advanced skill set. You said prior to hitting record, that working with sellers does require more skill set and it absolutely does and working with buyers
Until now. Now, it’s actually by working with buyers not only requires a ridiculously high skill set, because you have to find the inventory, you have to know how to negotiate, you have to, you know, all these different complexities that buyer agents Never before had to deal with before it was you want to buy the house, you know, it showed them three or four houses, they pick out the one they want, and they buy a house. But nowadays, it’s finding the inventory, it’s knowing how to compete to get the house for your buyer. It’s all the complexities that are associated with the crazy extreme seller’s market, like what we’re in. So working with buyers used to be mostly a physical labor, social type thing, like, you’d work with me because you and I both like playing by wing planes or something, you know, your plane above your shoulder, right, so we can find some commonality. And then we work together, I show you houses for you know, a couple Saturdays, you buy something, we’re often the next, you know, after the next one. But nowadays, it doesn’t work like that I have to I’m gonna have to convince you in some markets, Justin, why I should why you should pay me a commission. Because the buyer’s agents Commission’s are going to go away, it’s going to get to the point where just I’m gonna have to give you a professional presentation that shows you why you should be hiring me in the first place versus going to the listing agent directly going to the 10 other people you know, just got real estate licenses why you should hire me to be your buyer’s agent. But in some markets, if the Commission’s are completely evaporated, which will happen, I’m the buyer agent side. Yeah, it definitely will. I’m gonna have to show you and explain to you why Justin, you I want you to work with me, these are the values I bring to you. This is the you know, my USP is in essence, but in addition to that, Justin, you’re gonna have to pay me a commission and agents, buyer’s agents have never actually had to compete present and let alone sell the reason the buyer should be paying the commission. And that’s what’s going to start happening in some markets. Because buyers, you’re saying are comfortable doing it on their own. They’re saying I can find the house,
knowing what you’re doing. I’m just gonna go straight to the listing agent and work out a deal there. Right. I mean, I didn’t go to the listing agent before as a buyer, because of the fact that I like you. You’re a great guy, you’ve got six kids, which, by the way, six kids Wow. Okay, so you’ve got I relate to you, and you’re a great guy, and you got a cool car, and we can have fun, you’ll buy me some Starbucks, I’ll buy a house, and we’ll be friends forever, right. But nowadays, I don’t, you can’t find me the house because you’re not a listing agent. Because we’ve been trying, we keep on having our asses handed to us, because we’re competing with 20 different offers. And now I’m going to say just I love you, brother. But I’m going to go directly to that seller, I’m gonna go directly to that listing agent, because I need to make sure I get a house for my family, you see how it’s, again, it’s the pendulum is swung. And so market forces are going to squeeze out the buyer’s agents, because in a lot of cases, the market is not going to tolerate that added a added person in the process. That’s basically all we’re experiencing. It seems to me that consumer side, so help us walk through a little bit seems to be the consumers in this market. Like if they don’t have a buyer’s agent, they’re in real trouble going up against a dozen other offers that do you think consumers are going to use what they would have paid their buyer’s agent as leverage to be able to offer more? Is that kind of your rationale there as to why Okay, so So you’re saying, You’re saying a couple different things there. But let me make it practical, what we have seen, and we have 1000s, of coaching clients all over the United States, Canada now, like we have probably like 100, in Europe now. But we’ve seen all over the world, not just the United States where there is a buyer’s agent commission, which is prominently United States and Canada. And there’s some places in Europe that operate like we do, is that the buyer’s agents to make their offer more appealing, let’s say the co op, we’re not talking percentages here. But we know what the traditional Co Op has been right? So let’s and what what so let’s say you’re selling in Omaha, Nebraska, and you’re trying to get some house together, and you want your buyer to win, you’re actually going to offer in the purchase contract a percent of your commission to that listing agent and to that seller so that that the seller is better because they’re they’re having to pay you less. So you’re volunteering to take a financial haircut? Because otherwise, how are you going to keep yourself competitive and get your buyer house, it’s like you either makes a little bit of money or you make no money. That’s again, the the elements of this market. And I hate it frankly, I believe in diarization, you know, I do and I believe what you said that they bring a value, some of them bring a value, but buyers are going directly to the listing agents and that trend is going to continue for at least the next three to five years until the market starts to pivot back and we enter some sort of equilibrium state. Fascinating. So back to today’s topic. Talk to us that if if that’s the reality of the buyers agent market, what is the best chance that agents have to go get listings? Obviously, there’s a number of different ways right, you know, dozens and dozens of ways to effectively get listings. What are there but are there? Let’s talk about that. Okay, I’m, I’m 51 and I’m guessing you’re 30 something? I’m 41 Are you really? Yeah, damn this six kids have kept you young. Good job.
It’s really good lighting. Right? So. So here’s here’s the thought for you is that there’s a generational divide and what people what agents are willing to do to attract business and it just is there and there’s no sense of denying it.
Here’s the biggest difference. Most agents getting in the business because they have no sales skills, no real business background, they’re going to be attracted to passive lead generation ideas. And they’re never gonna learn how to proactively lead generate. So what we there’s, there’s people say there’s two ways you form a business, there’s really only one way you form a business, you have to be a proactive lead generator first. And then if you choose to, you can enhance with passive lead generation. But if you do it the other way around, I’m going to create Tick Tock videos, social networking, my CRM, I’m gonna do all this digital stuff, I’m gonna hide behind my screen. And somehow miraculously, that’s going to bring business to me, you might get some but it sure as hell it’s not going to be consistent business. And what we teach people in our coaching company is okay, you can do that stuff, the fun stuff, you can do that after you’ve learned how to proactively lead generate, because justifier if you’re hiring me, well, I don’t play coach anymore. But if you’re hiring me to be your personal coach, the first thing I want to teach you how to do is go after that. Are we good? I see a stall out. Yeah, there we go. Right. We’re good. People don’t. It’s, it’s the Puerto Rico effect. Man. I’m telling ya, it’s constant anxiety, doing zooms. Right. So if I were to, if you’re hiring me to be your coach, the first thing I would do is I would say, let’s go to the marketplace. And let’s look for sellers that already have their hands in their air and saying, Yes, I want to sell my house. Let’s not go onto Facebook and do all this. You know, social networking, jab, jab. Let’s talk about that. Your job is to make money for you and your family as fast as possible, I want to take you directly to where there’s a seller’s right now in your marketplace to have their hands in the air and say, Yes, I want to sell my house, we don’t have to really look for those people, they already have their hands in the air. So the idea that agents are coming into this business, and they’re saying, Well, I have to buy leads, or how can I find leads, or I have to create a brand or do all this other stuff. It’s not true. You don’t have to do any of that stuff. You just have to develop the skill set to be able to go directly after the people who already have their hands in the air saying yes, I want to sell my house. And I mean, that’s that’s the honestly, the biggest fraud on real estate agents has been committed in the last 15 years, not saying what I just said, telling agents. So they have to create all these passive lead generation venues and never telling them the truth that they have to learn to be proactive lead generators. And so who have been perpetuating
those ideas. So here’s an interesting fact, the average agents historically has been entered out of business within less than 24 months. I’m sure you’ve heard that. Yep. Yep. So Julie, and I’ve done some anecdotal research, and it was only looking at it’s anecdotal at best. We’ve compare.
I won’t bore you. But I’ll tell you this. We think the average amount of time that an agent’s in business now is not 24 months, it’s basically about a year and falling. So here in this, we’re in this era, where agents can buy leads, they’re told to create, you know, all you got to do the online there. See, I don’t I don’t know if I’m offending you by saying this. I don’t know if you’re a marketer guy, because marketing people try to, you know, hang me up for saying this, but it’s the truth. If you want to, if you want to make money, if you want to help people, why don’t you go directly to the people that already have their hands in the air? And why don’t you reach out them? And why don’t you help them a pose, you’re just trying to create a brand for yourself, it goes back to the essence of the question, you know, the essence and it’s one of our chapters in our book. At the end of the day, if you want ever increasing levels of success, everybody knows this intuitively, by Oh, and I say this, you’re gonna say of course, that just makes sense. But if you want ever increasing levels of success in your life, financial just for the sake of this conversation, you have to learn to do what you don’t want to do when you don’t want to do it at the highest level. That’s it, learn to do what you don’t want to do. So if I asked you a real estate practitioner, what are the three things you want to do the least in your real estate business? I know what you’re gonna say, You’re not gonna say, I don’t want to create a YouTube video, you’re not gonna say I don’t want to do a podcast, you’re gonna say I don’t want to pick up the phone number one, right? That’s the most agents would say like 99% of them. But
that’s where the money is. Right? Yeah. So you’re saying that the people that are raising their hands, you’re defining those as for sale by owner expired listings is that it’s way more than, yeah, that’s a good place to start, because that’s the easiest information to get, but for sure, you know, for sale by owners and expireds. Matter of fact, to your point, I think if someone were to come into the business now we preach the the spokes in the wheel concept, it’s very simple. You have a wheel, you have multiple spokes, each spoke to, you know, represents a source of business, your goal is to have five to seven spokes. But your first three or four spokes have to be proactively generation spokes, if you didn’t want to enhance with passive marketing, passive lead generation you can, but the first spokes that go on your wheel have to be the proactive ones. So and this is not necessarily proactive, but the first one we tell agents to do is their centers of influence and past clients. And by the way, we don’t want them dripping tchotchkes on them and delivering pies and garbage like that. We tell them how to do a center of influence past client, no fancy CRM or long term drip campaign. We tell them what to do, and it doesn’t cost any money. And then the next thing we wanted to do to what you said is choose either expired or
for sale by owners Personally, I choose expireds. And then we show them how to go after other sources of practically generation. Here’s what happens when they do it. When they actually you don’t focus, you don’t go from this book to this book to this book and kind of mish mash it all together, you do the center of influence past client thing first, which shouldn’t take you any more than literally 24 hours to set up. It’s simple. And then after that you I would suggest you choose the expired spoke, don’t say there’s no expired in your market, because there are, I would choose the expired spoke next. And I would master that become like the best version of you hunting expired as you can before you go on to the next one. And then certainly Don’t you know that you have to really focus on one thing to really master that. And then what happens is after you get really good at these proactive lead generation spokes, most of those agents never do the passive lead generation ever, they might have a cursory Facebook page or Google My Business Page, or, you know, who knows, maybe even have a logo created, but they know their bread and butter is around those practice spokes. So if I were coaching you, what I would say is every day Justin, and I’m going to help you get to the point where every single day, you’re going to set a pre qualified listing appointment, and every single afternoon, you’re going to go on a listing appointment, you’re going to take 90% of them. That is your entire business model. So the only thing Justin I want you to get really good at is proactively generation pre qualifying, presenting and negotiating those four things, you’re gonna be terrible at everything else, because those are the easiest things to delegate or just frankly, not do, those four things will make you rich in real estate because it’ll create profit.
So really quite, I mean, your your methodology is simple. Like before noon, your job is to get a listing appointment, afternoon, your job is to go present and secure that listing.
Right, exactly, and, but and why before noon, and you’re probably discovering this because you’re 41. But people as they get older, have their best energy in the morning, for sure. And your hormones are unbalanced, you’re feeling you know, all that having had the sleep and you don’t have a bunch of blah, blah, blah. So the morning is generally speaking the best time. But it’s not true for everybody, you know, some people will do their lead generation on the weekends, and sometimes they’ll do it in the evenings, it just doesn’t look, the bottom line is, is do not if you avoid the real work of real estate, which is what we’re talking about the probability of you succeeding long term, you might churn some houses, you might sell some houses, but your profit you’re gonna make out of your business is gonna be non existent, because you had to buy that business. And let’s be clear, you are buying your business, whether you do it proactively or passively. One way, you’re buying it for your time and the other way you’re buying with your money, but I’m doing it proactively, you’re actually making a profit, you make $10,000 you’re gonna keep, I mean, 9000 of it. Whenever your broker split is when you do it the other way. It’s constant trial and error. Oh, did you hear this new way to generate Facebook ads? Oh, did you hear about clubhouse which I love clubhouse. But did you hear about this new thing on clubhouse, and now I’m spending money there to pick up the phone how the skill set earned the right to be the listing agent, and there’s no limit to how much money you can make, and then has consistent cash flow that way too. So as I mentioned, taught our art I keep talking to Tim our window today is is short. So I want to ask for one like your best script for calling an expired listing. Because I know there’s a lot of people out there that are saying like, I’m not doing that because I’m gonna sound like the person I don’t want to like I’m gonna be cold calling in, and people gonna be angry at me. Like it’s just a difficult way to make a living. And you’re saying it doesn’t have to be that way. What’s the best advice you could give to somebody to overcome that? And say, I’m going to convert expired listings into appointments. Just so that’s a great question. You got to understand the psychology of an expired seller. If Have you ever had a list of a personal house listing? Have you ever experienced that being an expired? You have had it? Okay, that’s perfect. Then how did you feel when that listing expired? Yeah, I was disappointed. Were you a little embarrassed?
Embarrassed, right? Where but I was I was frustrated. Like I was ready for it to go like my timing was no longer
you know, kind of
like going the way that I wanted it to right it was it was now everything is interrupted? Was this a personal house that you lived in?
Okay, so did you feel if you are thinking about it, and I’m not giving you these emotions, but this is how sellers really feel. And this is going to help you move past your resistance of calling them when an expired happens. They feel rejected, if it’s the house they lived in, you’re not just rejecting my house, you’re rejecting me personally, because how can you not love the house where I raise my kids and where I’ve had all these happy memories. So an expired subconsciously is feeling deeply rejected and hurt emotionally. Now, not all of them are going to react adversarially but you’ve got to move past that emotionally. You have to understand that that is the emotion that that person is experiencing. And then by the way, the scripts are easy after that the hard part for agents is understanding that the person that they’re calling needs their help, and you’re there to help all the like what what prevents Asians from picking up the phone, let alone doing it long enough become successful and it is they’re thinking about themselves.
If I call you as an expired listing, and Julie and I sold, you know, hundreds of houses when we sold real estate back in the 90s, when when we had I mean, between 102 100 a year for almost 10 years. And we did a lot of expireds. And I remember originally when I started calling, it was like, Why are these people being so mean to me, it’s another that ad took, you know, longer than it should have. It was I was in my early 20s, to realize that these people were feeling rejected. They weren’t rejecting me. And so what I had to set aside is my ego, feeling rejected. And so what I did is I wrote a sign up, and I put it up on my wall, I said, How can I help you and it wasn’t something I’d say it’s something I would think, because when you’re coming from a position of being of service and of gratitude, then your ego is not as dominant, it’s still there, that fear of rejection is always going to be there and never goes away. But it’s a little bit subdued. And so you might react Initially, I might hear some tonality in your voice, it’s a little adversarial, I just have to remember, that’s your pain, and I have to help you make that pain go away. And after that learning scripts is easy. The Psychology of knowing what you’re doing, you’re here to help people. That’s the number one thing, the I know, one of my script on a panel calls, I’m gonna set appointments, you can do that you can force yourself through it. You can, you know, bludgeoned yourself every day to do it. But really, it all starts with the, the true motivation of wanting to help people and then everything else is easier. Does that make sense? intellectually? No, it does. And it you’ve really tapped into kind of the purpose behind this show is that most problems and opportunities in real estate, they all begin in our own head. And what you’ve helped us to uncover here today, Tim, is the fact that oftentimes, we have this concept of who we are, when we’re doing business in the way you’re describing. And what you’re saying is if you simply change your paradigm, if you simply change your mindset, you’re going to be looking at things differently, you’re gonna look at who you’re talking to differently, and you’re gonna be able to step up and come from a place of care as opposed to a place of, I’m a shark, you’re trying to get something from these people. No, I’m here trying to give somebody these people because they’re in emotional need right now. And I have the ability to help them and comfort them. That’s right. I mean, you have six kids, when you hear you got like you, if you’re prospecting, you just channel, your youngest kid having some problems struggling with putting on a shoe or something, and you just channel that emotion. And when you pick up that phone, you’re gonna all of a sudden be operating in a completely different plane than you were before. You’re just I don’t want to sound like I’m a woowoo guy or mindset woowoo guy, because I’m definitely not, you know, I believe in grinding out and doing the real work. But at the end of the day, you can manipulate yourself through your emotions, and that person or the other to the phone, they’re gonna feel it. Yeah. You know, like, when you were describing what your mission was on your podcast, I felt that, you know, that was real. Yeah, yeah.
This has been awesome. I want to ask you one more question. And then we’re gonna wrap up. Final question is this you are a big thinker. You help other people be big thinkers. What is it that you do to continue to grow to continue to expand your possibilities? Always. I mean, Julie, and I live in a Ritz Carlton reserve property and Dorado beach, Puerto Rico, and every day we are running into other entrepreneurs and business owners and we’ve lived here for almost two years and some of the people we’ve made friends with but here’s the answer your question be a small fish in a big pond? That’s the answer your question. I could I can, you know, tell you stories about the people. I was talking to a guy last night that’s having his $13 million yacht delivered. And he’s he’s bemoaning the fact that he didn’t have a hell of had installed on the yacht. I mean, that was a real conversation. Remember, I’m a I’m a poor kid from Ohio. And I’m talking with dude about his health and his lack of Hello, Pat. And he’s regretting it. That’s amazing.
It is amazing. Tim, it’s been such a pleasure. Thank you so much for joining us today, really pouring into us helping us to see a different perspective of calling expired listing has been valuable for everybody. Regardless of whether or not that’s one of your key lead generation tactics or not. You’ve opened my eyes to a new way of going about this. And like a new way of taking care of people at a time that they need it. So Tim, total pleasure. Thank you for all that you do for the industry. And to everybody listening today. My final request is this. Go think bigger. Thanks, Tim for helping us do that today. Amen brother.