We Are Selling with Lee Woodward
We Are Selling is a weekly podcast about real estate, business and tackling life's challenges. Hosted by renowned real estate industry coach, Lee Woodward, learn from experts in their field and maximise your life.
We Are Selling with Lee Woodward
168 - Property Improvement Plans
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Transforming homes and maximizing sale prices through strategic renovations – that's the game-changing approach young agent Jesse Maxwell is pioneering in Newcastle's competitive real estate market.
At just 25 years old, Jesse brings a fresh perspective to property sales, leveraging his background in property management to deeply understand what owners need and what buyers truly value. Working with properties around the million-dollar mark, he's discovered that half-finished renovations and dated presentations are the biggest obstacles to achieving premium prices.
Jesse shares a compelling case study where he was the fourth agent to assess a partially renovated property following a separation. While other agents valued it at $800,000 and pushed for an immediate listing, Jesse spotted untapped potential. Using an innovative financing solution through SaleFunder, he secured $29,000 to complete essential finishing work – installing missing flooring, cornicing, skirting boards, and paint. The result? A stunning transformation that sold for $970,000 at auction.
The philosophy is simple yet powerful: buyers consistently overestimate renovation costs and use unfinished elements to negotiate aggressive discounts. "Something that might only cost $10,000 or $15,000 to fix, they automatically assume is a $50,000 fix and ask for that adjustment," Jesse explains. By eliminating these objections before listing, property improvement plans create finished products that command premium prices in today's selective market.
Beyond renovation strategy, Jesse has successfully pioneered digital timed auctions in a market where conventional wisdom said they wouldn't work. The transparency of online bidding coupled with automatic time extensions has created a more comfortable environment for serious buyers to make rational decisions without the pressure of traditional auctions.
Ready to discover how strategic improvements could transform your property's value? Listen now to explore this innovative approach that's reshaping real estate sales across Australia.
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Hello and welcome back to the podcast we Are Selling. My name's Lee Woodward, the author of the Complete Salesperson Course. Today's podcast is brought to you by our sponsor, nexar. Nexar is a dedicated real estate platform specializing in lead generation and database management of the entire real estate company For BDMs and agents. Working as one platform to generate opportunity. Nexar seamlessly integrates into your business systems, allowing you to have an extended solution. Let's get started with this week's episode. Get started with this week's episode. Throughout the program we've had the discussion about price improvement programs and everyone likes the concept of it because when you're in a listing conversation it can give you that edge for winning the business. And today's agent is Jesse Maxwell, who's had great success in the Newcastle, new South Wales marketplace. He is from the company Movable Jess. Welcome to the program. Thanks for having me along, lee. Jess. Time of recording. How old are you? I am 25.
Speaker 2:25,. How long have you been in real estate? Three years now a year and a half as a BDM for the property management side, before shifting across into the sales side a year and a half ago. What management side before shifting?
Speaker 1:across into the sales side a year and a half ago. What a great experience. What did you learn being a BDM that you brought into the sales arena?
Speaker 2:How to meet with owners, understanding their expectations, what needed to be done, and then also just developing relationships. So that's probably one of the biggest things that I learned as a BDM understanding what, like I was saying, the owner's needs, what they were looking to do, what they were looking to achieve as far as the type of tenant that they were looking for, and then how we can translate that into understanding what an owner or a vendor is looking for when they're listing a property for sale.
Speaker 1:What was the interest of transitioning from property management to sales?
Speaker 2:The interest just came down to demand in the business place. I guess an opportunity opened up within the company itself. So I shifted from that BDM role into the sales role. But I've always had a keen interest in sales myself.
Speaker 1:Now just for our international listeners and all the people across Australia, but for the UK and the USA. What type of property are you selling? What's the average sale price? What's the type of home?
Speaker 2:Working with a variety of different homes. Primarily, we're looking with either the apartment markets or we're working with standalone Torrance title houses around about the million dollar mark as far as an average sale price and what's a cheapie for you around here. A cheapie you can go for a one bedroom apartment without car parking. You can sometimes pick those up for around about $500,000 in Newcastle.
Speaker 1:Awesome. So that gives our listener an understanding of the type of property we're about to go into. And the property improvement plans was something you got out of the coaching. You've been through the complete salesperson course module and, just for our listener, you guys do it in-house each month and we've been doing it for two years, so you've really developed some skills. Take us into what got you interested in doing these price improvement plans and give us an example of how you're executing that work.
Speaker 2:The first instance, where it really became available to me is I went into a listing presentation and I was the fourth agent into the property and it was a really unique situation with the owners. They'd gone through a live-in renovation which was half complete and they're in the midst of a separation now and they weren't talking to each other necessarily. So it made it really quite unique. And what they were being told by the other agents was the property in its condition now is worth $800,000. We need to get it on the market because of the interest rates. Everything's going down. You need to sell now, now, now, and get it on the market.
Speaker 2:And I went through the property and looking at the work that needed to be done. There was no flooring, there was cornicing that was missing. There was skirting boards that was missing. Carpets hadn't been done either. A lot of painting work that just hadn't been done. But they had a $50,000 kitchen in the property. So there was these really premium parts to the home, as well as the bathroom, which were all there. It just needed the finishing touches.
Speaker 2:And I sat down with the owners and I said to them individually that in its current condition there's no direct comparables out there on the market.
Speaker 2:I know these guys are telling you $800,000, but a buyer is going to come into the property and they're going to expect the worst with what it's going to cost to bring it into a livable condition and they're going to use that as a tool to try and negotiate a price down.
Speaker 2:So what I said is we just started working with yourself, liam.
Speaker 2:We'd heard about sale funder and I said to these owners because they were a little bit tight for funds at the time as well, one of the things that we could do is we could take on board the management process, because we have a large property management business as well and a variety of trades.
Speaker 2:We can take on board project management aspect of the renovation for them. We can help facilitate quotes and coordinate the work so that we can get this home into a presentable condition so that the marketing material that we produce is going to be of a high quality and it's really going to help us attract the right kind of buyer that is going to pick apart the home to try and reduce the price. So that was the first instance of where I started using it and then, being that the owners weren't necessarily talking to each other or were clashing a little bit more. The ability to use SalesFunder have us hold the funds and coordinate the work so that we're a neutral party was really advantageous, and that was really, I think, the thing in the end that helped us get the business.
Speaker 1:You need an authority. You sign the agreement. Sales funder lets you know how many funds you can have, based on their system. How long does it take to get the funds?
Speaker 2:Almost within a week, yeah. So we found that the sales funder team has been excellent to deal with. Once we have a signed agency agreement, we can request the funds and then, yeah, it's really quick as far as the process goes.
Speaker 1:So this particular property that triggered everything? What was the borrow on that? What was the investment from sales funder?
Speaker 2:Yeah, so in the end we loaned $29,000 from sales funder. So that was for the marketing material, that was for the finishing work to the skirting, cornicing the painting, little bits and pieces throughout the home to get it into that condition. Wow, what was the final result? $970,000 at auction, absolutely phenomenal.
Speaker 1:Now auction's another word Again. You're in an effective business unit. You're doing all this coordination, the buyer management, the lead generation work, which is just fantastic. But you also got deep into digital sales, whereas a lot of people in your area didn't. It was like no, it's not normal. Take us into the digital sale. How's that been working?
Speaker 2:Yeah, the digital sale has been phenomenal. So when I said auction, it meant timed online auction, apologies. So the timed online auction is something that we're Well, you're actually right, it is auction, it is auction, but it's timed online auction.
Speaker 1:And just for our listener, there is other systems out that it's a unique method of digital sale. This is not In using the realtor product that you are. It's just a normal auction, but it's a timed auction. Now I was told by everybody Newcastle won't do this. They won't register. You guys have done so many sales now what's been your learn from the consumer and timed auction.
Speaker 2:The consumer has given us terrific feedback about the timed online auction process. I think the transparency that you gain with being able to see what somebody is placing as a bid online makes the process so transparent for the consumer so they know that it's a genuine party that's actually placing that bid online. And then having the ability to have a countdown timer which is showing when the auction's going to close just takes a lot of the stress away. I think a lot of the buyers out there at the moment don't like the idea of an on-site auction with an auctioneer that's giving a first, second, third and final call and putting them under a lot of pressure. With the timed online auction platform, if another bid comes in in the last five minutes, they now have another five minutes to make a decision. So we've had a lot of positive feedback just about the process and how streamlined it is, the transparency and the ability to sit back and actually make a rational decision.
Speaker 1:It's amazing, isn't it? But this makes it achievable for the purchaser not to miss out on the property, whereas in traditional real estate they'll ring back I'm sorry it's sold and they didn't get that notification, that chance. And right around the country, I explain to people this is the consumer's wish to know, they want that notification, that bidder number four has gone up another 50 and they want to go up another 50. Whereas in real estate we say we've got another offer and people are saying, oh yeah, sure, they actually don't believe the agent due to the past and the history. Back to these property improvement plans. One thing I can do in a podcast, jesse, is I can hear people driving in their car right now and there's questions in their mind, and one of the questions in their mind at the moment is how much time do you have to spend facilitating the trades and there's a lot of project management because you're technically becoming the builder without swinging any hammers and just coordinating all the trades. How much time do you put into them?
Speaker 2:Realistically we can streamline it depending on the situation as well and the access to the property.
Speaker 2:Another one that we've recently had has just been an apartment which had been a tenanted property for 15 years.
Speaker 2:The tenants were coming up to the end of their lease and the owner was deciding that they were going to put the property on the market once the tenants had decided to vacate the property.
Speaker 2:So we managed to get through the property a couple of weeks before the tenants had vacated and we had a look and there was the need for painting carpets, blinds and curtains throughout the home as well, because it had just had tenants in there for 15 years, so there was the wear and tear that had come along with the property as well. And then what we're also able to do is in another walkthrough with the tenants still in the property was have different trades come through. So we had a painter, carpet installer as well, blinds, curtains, staging company all come through in the one meeting and then from that we're able to get quotes whilst the tenants were still in the property and then develop a timeline for the owner to say that once the tenants move out. This is how we can coordinate the works and in what order we're going to do it in order to try and get the property on the market as quickly as possible once the tenants have moved out.
Speaker 1:Amazing. Do you enjoy the process of it? It's become a different part of real estate versus just listing, selling, leasing. What have you learned about coordinating trades and putting these sites?
Speaker 2:together. I love the process, lee. That's probably one of the most fulfilling parts of my job I'm finding. Now you actually get to see the transformation. One of the toughest things, I think, for owners is when they see the property from what it was to what it becomes. They almost say, hey, I don't want to sell this anymore. So when you get that feedback from an owner, it's really positive and I really enjoy that aspect of the work.
Speaker 1:And for everyone listening to this. It's such an important part of the sales process to depersonalize the property from the current situation. When the buyer comes through, they're looking to buy their home, not the owner's and the styling. We've seen some incredible before and after photos of these case studies that you're doing. You wouldn't recognize it was the same home. This is why the prices are so good. But it seems, jess, for everyone around the country right now, the only properties that are getting good results are finished product.
Speaker 2:That's correct, lee, and that's the feedback that I've had from a lot of buyers in the Newcastle market as well. Anytime that they are going into a property and there is work to be done, they're thinking worst case scenario for something that might only cost $10,000 or $15,000 to fix, they're automatically going to assume it's a $50,000 fix and they're going to ask for that as an adjustment. So if we can remove all of those objections beforehand, that's ideally going to work in achieving a better price for the owner. And I think there's only a set amount of things that you can control when you are marketing a property. So we want to be able to control those things, with the presentation being one of them. The better marketing material that we can produce, the better engagement that we're going to get from buyers out there in the community. More engagement means more people that open for inspections. More numbers that open for inspections generally means more offers on the property as well.
Speaker 1:So, jess, in this incredible role of you're like the conductor, you've got all the trades running around, but you've got your own team of trades, you've got your obviously, with such a large rent role as you have, you've got access to good people who consistently work for you. So that part of it you're working out the timeframes when the property's on the market. What's your main responsibility with the purchases? What are you doing for the unit there?
Speaker 2:Yeah, so, once the property's on the market, it's coordinating the marketing materials, the first large part of it. So we want to make sure that once we've done all that work to get the home into that pristine condition, we want to make sure that it's displayed, and it's reflective of that, on the online platforms as well. So that's the first thing. Once it's on the market, we want to take it off portal first to all of the buyers in our active database as well. Off portal, he said off portal.
Speaker 2:So I want to take it to all of the purchases in the community that we're currently working with. Get some feedback from them first in terms of where they see the pricing. Also make a short list of if they're interested in inspecting the property before launching it to the wider community as well. So that's on your realestatecom and domain portals as well. So once we've done that, then we move into the open for inspections. But it's really about communicating the feedback from buyers off portal beforehand first, and then that on portal and that buyer feedback to the owner to give them, I guess, an indication of where the market sees the pricing feedback.
Speaker 1:Absolutely brilliant, great example of staged marketing. So final questions for you. In this property improvement program you're using the funds. The consumers didn't know this was even an option and I think a lot of agents don't even talk about it because they already made the decision. Someone wouldn't do that. But if finished products only getting the right result and a lot of Australians are asset rich, cash poor how have you noticed their response when you say we can do it this way as a better option?
Speaker 2:Oh, very, very positive. As soon as you offer the option to take those funds from the eventual sales price, you don't have to put that money up front. It's almost like, wow, I really didn't know that, obviously that it wasn't an option, so it's been an overwhelmingly positive response to it as well.
Speaker 1:When it changed your listing presentation and you've got a selling plan, you've got a leave behind, you're doing all the right things, but I would imagine, especially for your age being one of our modern young agents coming through, the owner is seeing you in a different light of a different skill set, because you're not just talking about get it to auction, this is the price, we're the best in the area. It is a very different conversation.
Speaker 2:Oh, definitely. I think anybody can put a price on a property and list it up online and say, away, we go with it. But I think actually taking the time to okay, work through the property's needs and the owner's needs, what we can do, what we can control, and then taking the time to actually develop a plan in order to help them try and achieve the best possible result Something that we really like to focus on and I think that's had very positive feedback from our vendors on.
Speaker 1:Absolutely amazing, Jesse Maxwell from Movable New South Wales and Newcastle. Jesse, thanks for joining us and we look forward to hearing from you in the future.
Speaker 2:Thanks very much, Lee.