Podcast Episode #62 – The Luxury Home Niche with Glenn McQueenie

“20 Minutes of Successful Niche Secrets – EPISODE 62”,

Where I speak with Graeme McInnis about becoming an expert in the Luxury Home Niche

 

“20 Minutes of Successful Niche Secrets – EPISODE 62,”

Where I speak with Graeme McInnis about becoming an expert in the Luxury Home Niche

Glenn: Hi! It’s Glenn McQueenie, and welcome to my 25-Minute Success Series Podcast. Today we have a special guest, Graeme McInnis, from Keller Williams VanCentral in beautiful Vancouver, British Columbia. How are you doing today, Graeme?

Graeme: Glenn, I’m doing really well! How are you?

Glenn: I’m doing just fine. I’m excited to talk to you today because we’re going to try to figure out what that winning formula is for your niche market.

Graeme: Yeah.

Glenn: So can you just tell me where you are now, and where you want to go? And then let’s just see what we can come up with!

Graeme: Yeah, for sure. I’ve actually been a realtor for quite a long time. This is my 13th year in the business. I actually recently moved to Vancouver. I was practicing in Calgary for basically all of that time. I moved here last February, and I’ve got a business partner now. We’ve got a real estate team, and we’re just getting things off the ground this year with Keller Williams and with our team.

Glenn: Okay. So where do you want to go with this team? What’s the vision? Just paint me a picture of where you see this business. Imagine it’s a year from now and you’re like, “Hey, it’s been the best year of my life.” What would have to happen for you to say that?

Graeme: Well, we’d need to do an awful lot of sales, and have the team growing and continuing to build out. I don’t think that happens all at once. It’s a process. Quite a few sales would be awesome. Maybe for next year something like 50 sales or more for the team, and a relatively high price point. The average price here is already pretty high, but if we could triple that or double it, that’d be amazing.

Glenn: Okay, so what would be the perfect average price point for you?

Graeme: $2 million? $3 million?

Glenn: Okay. And what does that get you? Who would be your perfect client, if we had to paint a picture of you finding the $2-3 million home? How old are they? Where do they live now? Where are they going?

Graeme: Those kinds of clients are spread out over a geographic area. I’ve never been one to geographically farm. I have tried to demographically farm before, but I think that I’ve always had the most success with people that were most like me.

Glenn: Right.

Graeme: So roughly my age, maybe they have family or they don’t, but they’re professional, they’re successful, they probably are looking for their trophy home at this point. So they’ve got the condo, they went to the townhouse, they got the single family house, and now they’re moving to something pretty spectacular that they’re going to be in for probably awhile. That would probably be a good description.

Glenn: Okay. So how old are you now? Paint me a picture of that demographic. Are they mid forties or fifties?

Graeme: Yeah, I’m 41, so couples, families that are in that general age range. Maybe they have kids, maybe they don’t. That’s not super important to me personally. I don’t have kids right now, but working on it. And professionals. I’m a high D, and I tend to like people that are decision makers, and not too worried about picking the house based on the colour of the house, or these ambiguous kind of things. I like to do deals. I like business. I’m not emotional really about my sales process.

Glenn: Okay. So where are they now? And it’s interesting – you said that you’ve never really geographic farmed; it’s been more of a demographic. And I think farms are a bit of a misnomer for a lot of people, but it’s not usually – I mean, it is geographic if you choose it to be – but most of your farms are going to be demographic. Or it’ll be your hockey team, your baseball team, the book club. There are lots of different ways that you can build a business.

Graeme: Yeah.

Glenn: So where is your perfect customer sitting right now? So they already bought their condo. Then they moved to a townhouse. And now they’re in a single family home. How much is that single family home right now?

Graeme: Let’s say $2.5 million.

Glenn: Okay. And then they’re going to be moving. They’re not just going to move over to $2 million or $3 million – they’re probably going to move up, right?

Graeme: That’s what I’m hoping!

Glenn: Okay. So what is the real trophy home price then in your area? What’s the minimum where people think that’s luxury?

Graeme: Wow. Jeeze. I’m going to say probably starting at $5 million.

Glenn: Okay. So they’re sitting in their $2.5 million home. So they’re doing pretty well. They’re professionals. They either have kids or they don’t have kids. There’s actually sub-niche markets because there’ll be one when you have kids, and there’s one when you don’t, right? When you do, a lot of it’s still going to be focused around the good schools and a great high school. It’s just the most important thing to parents, is having the right school and social connections for their kids.

Graeme: Yeah.

Glenn: So which one do you want to work on – without kids or with kids? Because there are actually two separate niches.

Graeme: Hmm. That’s kind of a tough question. Off the top of my head, I’m going to say with, mainly just because I think there are probably more of them.

Glenn: Okay. So what area of Vancouver are they sitting in right now? And then, what neighbourhood are they going to be moving to?

Graeme: Well, they might be somewhere in East Van, where the home that they’re in right now has gone up substantially if you follow the Vancouver market in the last, say, 3 or 5 years. They might not necessarily qualify for the home that they’re going to buy next (like a lot of people in Vancouver), but because they have that massive equity gain, they could still do the buy and the sell to get into that next level home. So there’s going to be a decent number of homes like that in, say, East Vancouver, that are maybe that $2 million - $2.5 million price point, somewhere in there. And then they’re probably going to be heading to the West side of Vancouver. A little bit more ritzy kind of neighbourhoods – Kerrisdale or Kitsilano, or some of these areas that are near the beach in Vancouver. Or probably North or West Vancouver would be a lot of those people. I think that’d be their target. I mean, West Vancouver’s kind of the Beverly Hills of Vancouver, and North Vancouver’s home prices are up as well, if you’re talking those trophy homes or those second-level, move up homes.

Glenn: Right. Okay. So what’s keeping them awake at night? Imagine you’re creepily lying next to them in bed, and they’re having some pillow talk about “We should get moving” and “Where do you want to go?”

Graeme: It’s funny you ask that because I just talked to a potential client, and he let me know that his biggest fear was that next level, bigger mortgage, and also, how do they coordinate selling their current home and then finding that next home that’s really going to be perfect before they sell, so that they don’t end up having to settle on the home that they buy? That’s probably what’s keeping them awake at night, is how do they transition from the home they’re in to the next home, in terms of lining up all the dates, making sure that they can afford it, and not having to settle for a home after they sell theirs? They really want to find the home first, and then sell their home. But whether or not they can do that – we’d have to find that out.

Glenn: Right. It’s a great point, and I’ll tell you every single person will have those same kinds of fears in that market. If you look at 20 or 30 years ago when the average house maybe took six months or three months to sell, it used to be that you would list your property first, because there was always tons of options available for you. You’d have it on the market for a couple months, and then eventually you would sell it, and based on what you actually got from that, that would determine where you’re going to go and what you’re going to move up to. But the game changed about 10 years ago, because we’ve got this, I call puzzling or surprising lack of inventory right now, where either the population’s increased, and they just haven’t kept up with the housing stock (especially in Vancouver, with all the rules and everything), but also, people are living a lot longer now, right? They’re not moving on the same schedule. At 65, 67, men would die. Well, they’re living longer, and people are living longer, and a lot of them are just staying in their house. So we have this real, shrinking inventory. The problem is, your marketplace gets a bottleneck, where it’s like, “Well yeah, Graeme, I do want to move. I just don’t know where to go to” or “I haven’t found a house to move to.”

Graeme: Yeah.

Glenn: So if we know that’s what the facts are, then what we have to do is, instead of going after their listing, we have to think one step ahead and go after their purchase. Because I know that when you get their purchase, by default, you will always get their listing. Does that make sense? (As long as you don’t screw it up).

Graeme: Yeah!

Glenn: Right. So then we have to start offering them bait. Could you provide them with a list of the Top 10 Best Homes between $3.5 million and $6 million in North Vancouver? In Kerrisdale? In Kitsilano? In other parts of West Vancouver? Out by UBC, or whatever? We have to start almost building a marketing model that’s going to bait them. The bait to attract these types of people is that you’re positioning yourself as the expert in the market on the $3 million - $6 million homes.

Graeme: Okay. Sure.

Glenn: Right. So you could almost create a Facebook page called “Vancouver’s $3-6 Million Properties,” right? And all you did was you started picking your “crush of the week,” your favourite home of the week – the one that you just loved. And then you start pushing that out (or through Instagram, because a lot of your markets are more on Instagram now, not as much on Facebook), where you start actually just profiling the best homes in those areas. Because who’s going to be interested in the best homes in those areas?

Graeme: The sellers that we’re looking for.

Glenn: That’s right! So if we can narrow it in such a way that the only people who put up their hands are the people who are actually looking at what you have to offer, then you get to win the market that way. So you could start doing a weekend tour of $3-6 million homes in Kerrisdale or in Kitsilano. Just start offering it as a bit of a tour, or a daily tour, of those homes. “Here’s what we’re going to do. On Saturday at 2pm, we’re going to meet on this street at this coffee shop.” And you make it as if it’s this tour that a lot of people are going to go on, but you may only get one couple, or you could have two or three couples.

Graeme: Yeah. Right.

Glenn: But what if you just said, “Hey, listen. This is what our tour is. It’s

Saturday afternoons between 3 and 5” (or whenever you want to do it. Sundays. Who knows?) You choose the time when you think the most people are going to come. And then you actually start doing the tour of those types of properties. But before you actually get to the tour, you actually have to become the expert of those properties.

Graeme: Right.

Glenn: And the way you become the expert is you go onto your MLS system and you print off everything that sold in the last year (or two) in those areas, and then you get in your car and you drive by so that you become that expert. You have to do the product knowledge research so that you’re going to get more confident when you’re talking to them.

Graeme: Right.

Glenn: Because they might be like, “Hey, I can only spend $4 million, but I want this, this, and this.” And you’re like, “Okay, well you can’t get Kerrisdale anymore. You’re going to have to be in North Vancouver.” But you won’t know that until you have the product knowledge that’s sitting behind you. Does that make sense?

Graeme: Yeah, totally!

Glenn: And then what happens is, when you do the daily tour of homes, you actually put three or four on the list that you’re going to show them, but more importantly, you drive them by the last five or 10 sales in that neighbourhood, and you’re just like, “Oh, that one on 31st Street – it sold for this.” “That one sold for this.” And they start going, “Wow. Graeme really knows this market.” What they don’t know is you just drove by the day before and figured it all out, right?

Graeme: Right. Right.

Glenn: But the confidence you get, that they’re going to give you, is at that level. When they’re professionals, they just expect a professional level of service.

Graeme: Yeah.

Glenn: They expect that you know what you’re talking about, right? When you were dealing with professionals in Calgary, the moment you start winging it is the moment you start losing your professionals.

Graeme: Got ya.

Glenn: Yeah. So step one would be understand the market first. You’ve just got to get it. And then every single house that comes on the market, you’ve got to go and see it. And then you could even walk through with a video camera (if they’ll let you film), or you could just be outside and say, “Hey, listen. It’s Graeme McInnis. I’m just out inspecting all the best homes that just came up between $3 million and $6 million. I’m going to have my “Best of” list coming out on Thursday, so stay tuned. I’ll kick it out to everybody. I’m going to go and look at 20, and I’m going to pick my Top 5. So there we go! Great talking to you. Have a good day! Bye!” Almost like a live broadcast.

Graeme: Yeah.

Glenn: And then what you’re going to start doing is you’re going to start building a tribe of only people who want to consume what you’re giving them. The Internet is just all sub niche markets, right? If you like watching other players play Fortnite, it’s because you like Fortnite.

Graeme: Right.

Glenn: So that’s all we’re doing.

Graeme: I haven’t tried it yet. I’ll stay away from it, probably.

Glenn: Yeah, that’s right. But the whole thing is, you just have to build a model where you just self-proclaim yourself the expert. And then you just do free content, and really good, curated content, that people just get addicted to it. They just want to go and see it.

Graeme: Okay. Yeah.

Glenn: So that’s one option. The second option I’m going to give you is if you were to do something like this: could you get into the law firms, the accounting firms, the professional firms, and start doing pizza “Lunch & Learns,” and talking about “The 10 Secrets to Buying your First Trophy Home in Vancouver?” You have to get in front of them in order for them to see you as the expert. One of my agents in Toronto, just a couple weeks ago, wanted to work with just professionals. We got him in front of a law firm, and then they rallied, and they got 60 people to show up at the “Lunch & Learn.”

Graeme: Wow! That’s a huge turnout.

Glenn: That’s a huge turnout! And all he really had to do was he just positioned it. He knew a couple of people at the firm. He knew that that had to get done, and when he did that, he used their influence to bring it out. And then he just framed it as, “Hey, here’s the Vancouver real estate market update.” I don’t know if you want a lot of the lawyers – they’ll all be looking around the room – “Oh, you’re looking for a luxury home.” I don’t know if you have to be that specific right now, but there’s no reason why you can’t get in front of those accounting firms, the law firms, the engineering firms, the doctors, and just do a “Lunch & Learn” format. “Here’s the Vancouver real estate update.” “The 10 Secrets to Buying your Move-up Home in Vancouver.”

Graeme: Okay.

Glenn: The only challenge for you is because you’re new to Vancouver, right? If you were still in Calgary, you would probably know a lot of these people.

Graeme: Yeah.

Glenn: Yeah. So maybe you have to leverage those people in Calgary who were working at an office, or another branch office in Vancouver, to try to get you some connections.

Graeme: Okay.

Glenn: And you have to go through the HR Department usually, or find one of the partners or managing partners who will rally the people around, because they’re looking for content. They’re looking for culture. They’re looking for a reason to get everyone together in the office.

Graeme: Yeah, exactly. Yeah.

Glenn: Yeah. And you just show up there, and you’re like, “Hey, here are my 10 Secrets.” “Here are the 10 best neighbourhoods to buy in for 2019 in Vancouver.” Anything that’s marketing-based, value-based, that they think they’re getting secret insight is the best way to get these people.

Graeme: Okay.

Glenn: Does that make sense?

Graeme: Yeah, totally! Taking lots of notes.

Glenn: Yeah. And then the third approach I would do is every time you meet somebody now who looks like they might own a $2 million or $2.5 million home in Vancouver, and you’re out socially or you meet them and they go, “How’s the market?” that’s when you go, “Oh, the market’s great, and I’m just fascinated by all of the luxury homes in Kerrisdale and Kitsilano and West Vancouver. I’ve actually started doing these weekend tours of these homes where a bunch of people can all get together. We go out and see my top five or six picks, and then we all meet up at a pub afterwards and have a beer and talk about the houses. Do you know anybody who’d be interested in going on that tour?” You never ask them if they want to go on it. You start asking them who they know who would go on it, and a lot of times they’ll say, “Well I wouldn’t mind going on it.”

Graeme: Yeah, okay! Yeah.

Glenn: And then what you do is on your Facebook page, going back there, (and you can even do targeted Facebook ads, targeting law firms downtown or accounting groups or whoever you think can afford that – or entrepreneur clubs or Chamber of Commerce or young professionals – whoever) you start putting the curated content on that site. “Here are Graeme’s top five picks for the week. My number five pick is this house here. It’s this house. It’s $4.2 million. It’s this. In fourth place, this one’s $5.2 million, overlooking Coal Harbour.” You can actually rank it, and then at the end just say, “Hey, this weekend I’m going to be showing these homes, so if you’d like to come on the no hassle, no obligation tour, just private message me below and I’ll get in touch with you.” So we’re just using the bait in order to attract the fish.

Graeme: Right. Okay, cool!

Glenn: Make sense? It’s like the complete opposite of what everyone else is doing, because what everyone else is doing is spending a lot of money, targeting direct mail pieces to everyone sitting in that $2 million and $2.5 million house. “Just Listed,” “Just Sold,” “Free CMA,” “Free Market Evaluation.”

Graeme: Yeah.

Glenn: And that’s because someone told them that’s the right thing to do, but I’m telling you, no one becomes a seller seller until they become a buyer buyer first.

Graeme: Yeah, exactly. I mean, no one thinks, “I want to sell my house” and then they go to Google and type, “Who’s the best real estate agent?” They think, “I want to move,” so they go to Google and type in “Homes for sale in…” (wherever they want to move).

Glenn: That’s right. And there’s a difference between a buyer and a buyer buyer, right? A buyer is, “Hey, I’m thinking about buying.” A buyer buyer has to buy. Or a seller is, “I’m thinking about selling if someone pays me the right price.” But a seller seller has to go. So the more you can use where they’re going in order to get them, then by default (as long as you don’t botch it), you’ll get the backup. And then let’s look at the money on the table. For every, let’s call it, $2.2 million house that you sell, and they buy a $5 million house, I’m going to guess (I’m just doing the rough math) you’re about $90,000 - $100,000 in commission probably, on that.

Graeme: Here, the Buyer’s agent commission is probably only about 1% - a little over 1%.

Glenn: Okay, so you’re going to get $50,000 there. And on the sell side, you’re going to get 1.5% almost?

Graeme: Yeah. It’s quite a bit more on the sell side. Just, it’s a little different here than other provinces.

Glenn: Yeah. No, I know, it’s like 7% on the first hundred, and then 3% or whatever on the balance. So let’s just say it’s $70,000 - $85,000 every time you just find one client. So how many of these clients in the next 12 months would you have to find in order to have the best year ever?

Graeme: Yeah. Not many!

Glenn: Right! What if it was 5? Or 2? Or 10? It doesn’t matter. You start breaking it down. It’s like, “Okay, I need less than one person a month.” But then what you actually realize is, you need even less, because for every one listing you get at $2-$2.5 million, you have an opportunity to pick up four more transactions, right? You can find the buyer for that listing. Well, not so much in Vancouver anymore. But you could find a buyer for another listing. You can get another listing on the street. You can get another listing in the neighbourhood. You can get some Internet leads and sell that buyer another house. There’s a lot of great leverage you get. So you actually realize that in the next 90 days, you only need one or two people in order to get this whole ball rolling.

Graeme: Right.

Glenn: So what you do now is you start going, “Okay. I’ve got seven weeks until the market goes to sleep, so how quickly can I learn that market and get out there and get my Facebook page up and start meeting as many people as I can and trying to work your contacts and ask around the office if they know anybody who knows people at these law firms or whatever? And then just get in front of as many people as possible.

Graeme: Yeah! Right on!

Glenn: Does that make sense?

Graeme: Yeah!

Glenn: Good! Well, there you go! We’re at minute 25. See how quick it goes?

Graeme: Yeah, that was pretty fast. Awesome. Well thanks a lot, Glenn!

Glenn: My pleasure, Graeme. And good luck, okay? Let me know how it goes. I’m excited for you. Soon we’ll see you on “Million Dollar Listing.”

Graeme: Well, we’ll chip away at that for sure. Thanks very much. I really appreciate it.

Glenn: Okay. Thanks Graeme. Talk to you soon. Take care.

Graeme: Thanks Glenn. Yep! Bye.

Glenn: Bye bye.

Click below to attend our next event!