Win your worth secrets with Darren Hunter

Unlock the secrets to maximizing your property management business's potential with our guest, Darren Hunter, as he reveals strategies from his new book, "Win Your Worth Secrets." Facing a shortage of property managers in major Australian cities, Darren challenges conventional wisdom by advocating for higher fees to attract and retain top talent. In this episode, he dismantles the three main barriers that prevent agencies from increasing their rates and shares actionable steps to overcome these obstacles, ensuring a more sustainable and profitable future for your business.

Discover the power of confidently presenting your service fees without hesitation or apologies. Darren and I discuss how demonstrating the superior quality of your service can make clients respect your fee structure more readily. Learn effective tactics for addressing objections by highlighting the unmatched service and long-term benefits you offer. We'll also touch upon the concept of tiered pricing based on experience, providing you with the tools needed to stand firm on your pricing while maintaining client satisfaction.

This episode is about the complexities of property management fees, from rent collection and leasing to marketing and routine inspections. Darren shares personal anecdotes and insights from various Australian cities, illustrating how recognizing your worth can unlock hidden financial potential. You can tell by his voice, about how passionate he is by challenging you to discard limiting beliefs and embrace a mindset that fosters growth and prosperity. 

I hope this one brings you a little more motivation to charge what you are worth!

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Transcript

Speaker 1: 0:21

I am joined with the famous Darren Hunter today for our podcast, which I'm really excited for because it is about the new book Win your Worth Secrets, Darren, welcome.

Speaker 2: 0:34

Thank you, ashley. Always a pleasure to come on your show. I feel famous, obviously associating myself with the one and only Ashley Goodchild, so thank you so much for the invite.

Speaker 1: 0:45

No problems at all. It's always great. I received your book the other day, so thank you for sending it to me, and I've started reading it and I am really interested. I think we're in an interesting time with fees at the moment, so I think it's a really great opportunity to have these chats for everyone to hear. So tell us a little bit about the book, why you've written it and what you are hoping.

Speaker 2: 1:11

Property managers to get out of it, All right. Well, I mean, we've got a real crisis going on in our industry and you know, I did, Ashley, a quick search with SEEK across the country. It's really easy to do, and I went to the big cities Adelaide, Perth, Brisbane, Melbourne, Sydney. Then I went to Hobart, Canberra and Darwin. Out of those eight cities, there was something like 3,450 job vacancies of anything to do with property management. Now, there'll be some government jobs in there and there'll be assistant property manager and BDM or whatever.

Speaker 2: 1:51

But you can see the massive, massive problem and you don't have to go far into the industry to see it for yourself. Officers are greatly understaffed. I was just speaking to one of the sponsors that we work with. He just said Darren, one of the big problems of people not taking up our product is offices are understaffed. They haven't got the time, they're in chaos, and so you know.

Speaker 2: 2:15

The thing is, Ashley, let's just say an office is struggling to find a property manager in Perth. You can find a quality property manager in Perth like that if you put more money on the table, All right. If you're not putting enough money on the table, you're going to get crickets, All right, and that's the problem. And then officers go well, Darren, we can't put more money on the table because our fee income sucks. Yes, it does, and that's the problem. And so we've got to get serious now, and I've always said this WA and Perth is the only place in Australia and probably the world that I'm aware of that have been serious about property management fees from day one. All right, the rest of Australia sucks with fees and they've created this fee structure which is just not sustainable with today's market condition.

Speaker 2: 3:10

So the answer is we've got to put up our fees, We've got to add on fees, We've got to increase our fees to a serious level that we can create a highly profitable business where we can pay property managers the very, very best, and you put serious money on the table. You're going to get serious attention from the talent that you need. It is out there. You're just not putting enough money on the table. So this is where we run into a new problem, because this is what we call when I start talking like this Ashley, you can be getting higher fees and better fees. You know, Ashley, everyone's got a big butt. They've got big butts and they all start coming out. You know the person. Other people have got different butts from someone else, but it's but, Darren, you can't do that and we're going to talk about the big buts. There's three main big buts that people have and these are the reasons why, in their mind, they can't achieve it.

Speaker 1: 4:14

I look forward to hearing out what yours are, because I've written one down here that I'm interested. I want to see whether you've got it on.

Speaker 2: 4:21

I'm sure that one of the buts is probably one of the big three. There's a few, but the big three and this is why I spend so much time on the book it's all about unlearning, because everyone increasing your fees is really really easy. The problem is is that you think it's hard and I spent a whole book showing you why it's easy and it's so many unlearning things, because the reasons that we have in our head there's three main ones. It's not true and they're false, and these are incorrect, wrong mindsets, of no fault of your own. These are things that you know. For example, you keep on having these owners come to you saying but the other agent is cheaper Over a period of time. You're going to think that owners only care about cheap fees, but it's not. There's actually something else going on that you just haven't caught on to and so we'll talk about that.

Speaker 2: 5:15

But firstly, ashley, so typically with offices, once they solve this problem and we've got it covered in our book very quickly the offices that go out immediately, they're getting fee income 50% more per property or more. So even up to 80%, the highest I've seen with offices that have taken a hold of the teaching and implemented it once they've dealt with the big bucks and done the unlearning, it's 145%. So this is an office, for example, that was in Toowoomba. They were doing $1,300 and something dollars a year in total fee income way below breakeven and immediately they were doing $1,900 a year per property more. Now that's the record 145%. But 90% or 50% is pretty typical and that's what we cover in the book. But firstly, everybody, let's just start this journey and you know, ashley, jump in when you've got a question, because I'll just keep on talking underwater if I could.

Speaker 1: 6:15

So well, hold on. I do have a quick one. What would you consider a break-even, and is that should it? Or is it the same for all the states? Because I know you've just done sort of a big um, you know, research tour with all of this. So, um, what, what does that look like?

Speaker 2: 6:30

to give people an idea, every time I've done the exercise and, uh and more, the most exercises I've done is actually in perth. So, um, when I've gone into an office, very simple, because look at their total expenses for the rent roll. Okay, and this is a lot easier when you're a property management-only business, but you can still do if you've got sales. There's just some things you have to consider when it comes to electricity and phones and expenses, and what's the portion for sales, what's the portion for property management. But we also look at okay, so what's your total property numbers each month? So one month it might be 550. The month before was 545. The month before was 520. But each month write them down 540, 520, whatever, with your total yearly income and then work out what the average was, all right. So once you've got your average for all of those months, okay, so it might be 545 out of all of those 12 months.

Speaker 2: 7:32

Now take your total expenses, divide that into that property number and every time I've done that it came out at around about 15001,500. Now this is look several years ago. So add on cost increases, it might be in Australia at $1,650 now In New Zealand. Of course that's Aussie dollars. What I just said, translate that over Now you're looking at $1,700, possibly $1,750 for New Zealand. So that's what we've done and that's the break even, and a lot of offices just don't get it. So that's what we've done and that's the break-even and a lot of officers just don't get it.

Speaker 1: 8:04

And I've done this exercise as well. So I'm glad that came up. Ours came up when I did it in a small group it actually was between 1,000 and 1,500. However, at that time I was actually 1,000, but I was also very, very skimp on a lot of things because we're going through some financial problems going back about sort of five, six years ago and it was actually way too low. And when we sort of balanced it out with the offices, 1500 cost to manage is what it came out to as well. So I'm glad that, yeah, my figures came out exactly the same with my own sort of private little research.

Speaker 2: 8:46

And adding to that, I saw the amazing Julie Collins who works with Inspired Growth Training saw at one of her sessions the other day. She said that you know, if a really good office is doing 50% profit, so take your break even, say 1650, and then add another 50%, so 1650 times 0.5, that's 825 plus 1650. So you need to be doing at least two and a half grand in total fee income per year, otherwise you shouldn't be signing up the property. Everybody. All right, we're not a not-for-profit. If you like a lot of offices, you should be going to the government and getting your tax incentives for being a charity. Because there's so many businesses out there. And we've just fee shopped all of Australia, all right, we fee shopped nearly 800 agencies across the five main cities in Australia and the fees are shocking in a lot of cases. And what can I say? Perth is not what it used to be. There is a lot of dumb agents out there that keep on winding it down. And this is where we get into the crux of the book. Okay, is that? If you honestly believe, if I say hey, you could be getting higher fees and adding on new fees, you go.

Speaker 2: 9:58

If you, deep down, don't believe you're actually better than your competitors down the road and what you offer is better, and you don't believe your worth is better or you're worth more. That's the problem, because if you don't believe that you're better than your competitors, then deep down subconsciously, why should I charge more? I charge the same as them. Therefore, I should be charging the same as them. So, firstly, what we've got to do is build our worth. All right, we've got to grow our worth. To do that now, once we feel bulletproof, once we feel that we are 10 foot tall compared to our rivals, we can look someone in the eye and say, yeah, we know that all of our rivals are cheaper. We know we're better. And here's why Bang, bang, bang. There's no flinching. You've got that confidence in your eye. Your tone just says we are the best. If you believe it, they will believe it too. And so what I've done is I've analyzed confidence. We've got to have more confidence to build our worth. There's two main ingredients that we've got to put in place. We're going to grow this foundation where we know we are the best. That's why we charge the best. Two things. Number one is you've got to increase your position of strength.

Speaker 2: 11:18

It's just my fancy word for saying points of difference. Okay, and you need to have amazing points of difference. Now in my book I go through the 10 most effective points of difference out there and, quite frankly, I can't say I've just stumbled across 11 today, but I've decided to put 11 in verbally and I don't know. You know, I haven't gone through your list of sponsors, so I hope I'm not speaking out of turn. But Inspection Express oh my goodness, mate, their stuff is so good and their virtual tours and things like that that can be bedded in the property condition report, the routine inspections, the file inspections, oh my. But if you beef yourself up on the best points of difference, you are going to feel totally unbeatable.

Speaker 1: 12:05

I actually did a podcast yesterday with Inspection Express and I was looking at that appraisal feature that they've now got inside their platform, which is a super easy link where you just include that in your marketing and it shows them the example virtual tours and inspections and all of that. It was really really good.

Speaker 2: 12:28

It's amazing. So, guys, you've got to get really good at your points of difference. Now, ashley, all credit to you. We talk about the property owners handbooks and so forth in the book. You've already implemented those. It's part of your confidence. It just gets stitched into you that you know where better and it shows Again, if you believe it, your clients will believe it too, and they're happy to pay more.

Speaker 2: 12:49

All right, so, moving on. So points of difference, and we cover the best 10 in the book. By the way, we go on to the 10 most lame ones that we see people spouting all the time, and we've got those in the book as well. All right, so that's ingredient number one to build our worth and our confidence. So we know we're the best, so we can charge.

Speaker 2: 13:07

The best number two is just good knowing how to respond to fee objections. So, um, and we cover a really good one. Now, of course, we've got a separate book called the pm fee script secrets where we we go into 50 plus, um, different objections and you can get access to how to get access to that book when you get the, when you're worth, but the best objection is actually yours, um, um, ashley, and you know, I. I love that you've built up a an attraction magnetism strategy as being the experts of, people are drawn to you, they come to you as a warm lead. So when they do ask and pop the question, but the other agent is cheaper again, what's your response?

Speaker 1: 14:19

our fee schedule holds. I'm trying to what I normally say our fee schedule is a great value fee schedule and I, I don't, and, and that's pretty much all I say, because, um, you know, we do have a great value fee schedule.

Speaker 2: 14:32

Our fees are good value. Our fees are good value. Our fees are fixed.

Speaker 1: 14:38

And do you know what? One thing that I learned when I had this retreat and it was the power of influence is the importance of not apologising. Don't say I'm sorry, but our fees are fixed, or I'm sorry, our fees are good value. There's no, I'm sorry, the fees are fixed. So I'm sorry, our fees are good value. There's no, I'm sorry, the fees are fixed. Cut out that apology, because you shouldn't be apologizing, so that for me is like was a big thing, and that's why that short little sharp um, you know, our fees represent great value and are fixed. That's it. That's the sentence in full just a politely blunt response.

Speaker 2: 15:11

But you can do that because you've generated warmth. People have come to you not because they're looking for an agent. They've come to you because they want Ashley. So you can afford to do that. And again, that's another training session that you do very well about getting your attraction strategies in, and we'll cover that, of course, in our two-day event that you're able to speak at at our event in Brisbane in October.

Speaker 2: 15:34

But moving on, so okay, so you've got to have good fee objections. So if someone says, ah, but the other agent is cheaper, you need to have a really good response to that. And my favourite is look, mr Smith, we're well aware of what other agents are charging. But did you know? They know what our charges are too. All agents know we secret shop each other all the time. But despite them knowing what our fees are and knowing deep down that they cannot compete with us in our level of service, they're cheaper because all they've simply done is wound down their fees in line with what they deliver. Because if they truly believed they were as good as us with service, they'd be charging the same as us. But they're not.

Speaker 2: 16:17

And that is such a liberating script. But it's that or having others of a confident response. Okay, and so once we've got a good, effective response, we really believe that we are better with our points of difference. It breeds confidence Because when you are the most confident agent, they will see that 90% to 95% of property investors are looking for a hero, and that's really important. They're looking because they are not losing sleep over cheap fees. They're losing sleep over I don't want the tenant from hell, I don't want my mortgage not being paid. That's what scares the crap out of them and when they come to you, they're really looking for that hero.

Speaker 1: 17:07

So let's come back and I was just going to sort of say on that, on the times that I've had tough landlords wanting to negotiate, I mean, there's been times where I've actually given them a bit of a business lesson and I've actually said to them listen, I'm going to give you a business lesson on what happens in the back end, so you can understand why. And I've actually gone in just to say listen, for me to keep long-term staff, which I know is really important for you, I have to pay well and I pay well and I have long-term staff. So you're not going to get someone that swaps around every 12 months and if I start dropping to what you need or what you want, then I'm not going to be able to do that and it's going to cause a problem down the track. And when you sort of explained it as well to them, the reason why the fee schedule, it's great value and this is why, um, the benefit you're going to get out of it, it's um, they understand and and I I haven't had to do it a lot, but I have to I have given a few people a little lecture about business and, um, they appreciate the understanding of it because, like you know, like you say all the time they don't actually really want the discount.

Speaker 1: 18:12

It's just they, it's just like a natural thing. They ask it's not that they really care. And the times when I've said our fees are fixed, they respond back saying, okay, send me through the paperwork. That, literally, is what they say they don't care.

Speaker 2: 18:26

And I call that a veneer. We're going to talk about that coming up. So let's just get into now again if I say well, the offices I've worked with coming up. So let's just get into now again if I say well, the offices I've worked with. For example, you know I've gone into a typical suburban agency. They're surrounded by cheap agents. Look, everyone's surrounded by cheap agents. You're no special than anyone else. Your rivals are dirt cheap, just like everyone else's. There's people doing stupid stuff, just like your rivals. Everywhere I go, whether it's Australia, new Zealand or United States, okay, but if I say to you right now, you could be. For example, now we're not talking about Perth fees, because Perth charge for everything. You know Perth's one of those few places where I don't go adding fees. I just increase fees only. I don't add any new fees because you guys have added every fee that there is at the moment.

Speaker 1: 19:09

And actually, while we just quickly mention Perth, no-transcript is normal. It's you guys on the east coast that have dropped your pants at some stage. You guys are the ones that are not normal. We are normal, so it's not. It's not. I don't want investors to think that we're unusual because we're not, we're normal.

Speaker 2: 19:46

Yeah, yeah, you're charging right. So, yeah, okay, so let's move on. So the offices I've worked with that, in a typical marketplace, can add some fees, increase some fees substantially. Then the big elephant shows himself up in the room and I don't know how many times I've done this in front of people and their eyes just glaze over and they're looking at me with no expression. I know what's going on. The big butts are now the elephants in the room. The big butts are now in their head, but the big butt is between them and me.

Speaker 2: 20:17

All right, and it's. I can't do that. But, darren, I can't do that because and there's three main ones. Let's start off with the main one. So, for example, if I say, hey, you could be charging repairs and maintenance, or you could be charging a routine inspection or a tenant exit fee, which is what I've been promoting lately but, darren, what's the management fee for? Okay, so let's talk about the first big but. All right, now, I cannot find anywhere on the planet, if anyone, I'm going to give you a bounty. All right, I'm putting some money on the table. A bounty If you can go. Find me the rule book that says what has to be covered under the management fee. Please send me a link and I'll pay you some money.

Speaker 1: 20:58

Because I know you can't find it. Do we need to be changing the word management fee to rent collection fee?

Speaker 2: 21:04

Good point. So let's talk about that very quickly because I think it should be called the rent collection fee. Because, for example, if I want to go out and get a debt collected and I go get a debt collection company, they're going to charge me 20 to 30%. Now I get it. The difficulty of getting that debt is different from rent collection, but still, rent collection is a soft form of debt collection because you can't ask for 12 months upfront of that collection. Because you can't ask for 12 months up front, you are relying on their voluntary payment every two weeks, every week or every month in some places, all right. And if it's not paid, then there is a collection process. There is a series of texts and phone calls and legal processes and of course, wa can start their process at day one. Thank you very much. We can't do that anywhere else in the country, but there is a process, a legal process, and there's training and skills and all those sort of things behind it that cost money.

Speaker 2: 22:00

So your 6, 7, 8, 9.35% far out could be justified alone. Just on rent collection. All right, now repairs and maintenance does that have to be covered under the management fee? No, and I bet right now you're thinking oh Darren, you know what's the management fee for on that one. But you could do it like that. I mean, I've got agents here in South Australia. Nobody charges for repairs and maintenance fee, except three, and they're all completely disconnected from each other throughout South Australia. They don't know who the other is. I do and I say have you ever had any owners object to your repairs and maintenance of 8%, 10% or whatever it is on each invoice? Okay, no, I've done, been doing it for 12 years. Yeah, I'll go down the road to one of their competitors and say, hey, you could be charging repairs and maintenance, but what's the management fee for? You can't do that. Owners won't pay. There's the problem. Anyway, let's move on. So rent collection it could be called the rent collection fee.

Speaker 2: 22:57

Now the other challenge that I have for people is this is if you say to me why you know the management fee that's what's a management fee for? Well, why are you charging your leasing fee separate? Why are you charging your marketing fee separate? Why are you charging your monthly admin fee separate? I could really argue that one or fee, fee, fee, fee, fee, you see, and you would give me a full justification why you charge your leasing fee separate and all of that. So my point is if it's a routine inspection fee or a tenant exit fee or a file inspection fee or repairs and maintenance fee, treat it the same way, people, it's just your mindset the big, but it gets in the way. All right, moving on, let's do but number two. You ready, but Darren, I can't, because my rivals aren't charging it. I can't do it, all right.

Speaker 2: 23:46

And so this is where we've got to understand everyone. What's called the law of the main game and I cover that in my book, the PM Fee Script Secrets is that the wrong thinking that we have is we think that owners are equally critical and focused on a management fee, the same as a leasing fees, the same as a marketing fees, the same as a routine. They're focused on all of those things. It's simply not true. The law of the main game is very simple.

Speaker 2: 24:11

There was two owners at a barbecue and they're having a chat about property management and one guy says well, who's managing your property? Well, I'm with XYZ real estate. Oh, my goodness. Well, I'm with ABC Realty down the road. Hardy, ha, ha, ha, what are you getting charged? And he says well, I'm getting charged 8%. Well, I'm getting charged 7% then, but they didn't talk about anything else. They only focused on the management fee. They can't remember the other stuff. They've overlooked it. It's not important.

Speaker 2: 24:40

So I go down to Ikea and I've got an Airbnb property right, and I go down to Ikea and I'm getting it prepared with all the furniture packages and all of that sort of thing, and I'm focused on what the furniture is going to cost. But I didn't take into account the delivery fee and I didn't worry about the assembly costs, because I'm one of those people show me an Allen key and I'll break out in a sweat and fear and cower in the corner. And so I go to a restaurant and I get given three menus a big one for the meals, a small one for the drinks and even a small one for the desserts. But I judge the restaurant on the main meal prices. Now, their drinks may be high, but it hasn't been a concern for me. All right, and I go down to the gym, I'm looking for a membership, I'm focused on the main game, which is the weekly membership fee. And then they tell me about every three months you're going to get charged for direct debit costs and a joining fee, but it's of little importance compared to the main game.

Speaker 2: 25:44

So owners focus on the management fee, everybody All right, and they don't take much focus on anything else. So how does this work? You just make sure that your management fee is in line with your rack rate normal of your market. Now in a market there's a swing. So in Perth I know the quality agents. They go anywhere up to 9.9%. I know that for a fact. But I also can find them charging 7.7. So there's the swing and the crappy agents will price themselves at 7.7. The quality ones will be at 9.9 or 9.35. There's the swing. So you just make sure that your management fees are a rack rate acceptable, normal, because that's all the owner gives a crap about all right.

Speaker 2: 26:27

Now again, if you're thinking, oh darren, they care about the other stuff, yeah, every now and again. But how many times have you been asked? But the other agent is cheaper if you can match your fee with the other agent or whatever it's always to do with your management fee, they are focused on that. So the profitability is not so much in hiking your management fee up and we do if you're unnecessarily low but into market normal conditions. We do the work in the other stuff, all right. And so we're adding on two or three extra fees or increasing some fees and so forth. Okay, so that's big butt. Number two, so that's where I can go into a marketplace and you've got an agent charging a management fee, leasing fee, marketing fee and not so much else. And I can go to another agent and we can add on five or six extra fees or increase them and it doesn't make any difference as long as the management fee is at a RAC rate, acceptable, normal.

Speaker 2: 27:26

All right, all right, big, but number two has been kicked. All righty, you ready for the third one?

Speaker 1: 27:32

Go for it.

Speaker 2: 27:33

All right. Now this is really interesting how human nature works. Okay, because once I have pushed down the big domino and usually the biggest one is but my rivals don't charge those fees. Therefore I can't, all right. But once that goes down, human nature isn't that easy. We're not scot-free home yet, because once we've got one down, the path isn't clear between them and doing it. Another new, new big butt arises in the way of okay, well, we push one down, but what about this other one? Here they go create it in your mind. They just bring it up because human nature just wants to be. You know, you can't just take away something that I've been believed in for 20 years. Then something else comes up. More resistance is created. Once we remove the biggest resistance, does that make sense? It's just human nature. So the next one that commonly rises up okay, darren, all right. I agree with you on the law of the main game. Yes, owners are only really concerned about the management fee. Well done, but, darren, owners only care about cheap fees. That's the second one. All right, that comes up. Okay, so you made a really good point.

Speaker 2: 28:44

The other day we were on the phone and I'm going to talk about that because it's really important and I'm actually now even talking about that conversation in my training to prove that owners don't care about cheap fees. Now, yes, there is a 5% of owners out there that really do dream about screwing the agent over. All right, they're unreasonable, over-demanding, controlling, bullying, they take up lots of your time, they charge above market rents, they screw you down on your fees, they put little to no money into the property. They have a crap property that attracts a crap tenant, and they usually got a low rent property too. They're our C-class landlords. They're like a packet of cigarettes and they'll take years off your life. Yes, but most owners aren't like that. The night before they're meeting with you or talking with you, they're actually got anxiety around the mortgage not being paid and getting the wrong tenant, around the mortgage not being paid and getting the wrong tenant, and so what we need to understand is their primary motive, and this is where you come in, ashley.

Speaker 2: 29:45

What you said to me the other day is Darren, we've got a really good strategy now where we've got a junior in the office, where, if someone says, well, can you give me cheaper? Well, you start talking about the junior and what happens is that strategy actually unmasks and exposes their primary motive of what they've lost sleep over the night before. Because they didn't lose sleep over cheaper fees. They're losing sleep over they've got to have a quality property manager that's going to give them a quality tenant and get a good rent, and it needs to be as soon as possible. That's what they need. And so when you say, oh, mr Smith, yes, that's fine, if you want a cheaper rate, we've got a new junior on board that hasn't got as much experience as our seniors, we can charge a smaller rate. When you say that, ashley, what's the response generally from people?

Speaker 1: 30:32

They tend to want to go with your normal fee schedule and go with the senior with the more experience and so the primary motive is now being exposed.

Speaker 2: 30:41

So what we understand is that people come to you, they're anxious and they're losing sleep and they've got to have a quality tenant. They've got to have a quality tenant that's going to pay the rent on time and look after the property. They know to get that They've got to go with a quality agent because they haven't got the experience to be able to do that. That's the primary motive. So when you use that strategy, you're revealing what's really going on. So their primary motive is what most people come to you but there's a thin veneer and that thin veneer is simply that you work in real estate. Your fees are meant to be negotiable and they're just doing the ritual, they're just doing the dance, they're just trying to get a better fee, because that's what you do, because this is a real estate transaction, and they're just trying you on.

Speaker 2: 31:26

Just like, if I go and put a high ticket thing on Facebook marketplace, people are going to lowball me because that's what you do. Or if I go to Bali, I'm going to ask for a better price on that t-shirt or bag or whatever, because that's what you do. Or if I go to Bali, I'm going to ask for a better price on that t-shirt or bag or whatever, because that's what you do in Bali, right? So this is all they're doing. So this is why you guys got to have good objections or a good response to their objections. All right, because you know that they're going to try one and we know that it's usually going to be around the management fee and they're usually going to use. But the other agent is cheaper, which means it's usually going to be around the management fee and they're usually going to use, but the other agent is cheaper, which means it's usually they're focusing on a one percent difference. You've just got to be good at that one percent, and that's why we we've invented the cup of coffee script as well.

Speaker 1: 32:07

so, without getting into that, but one and so going like so with that fee schedule that we started doing and I'm really waiting and by october I'll have a good handle on what the more of the feedback with regards to offering that's been, but it definitely what I love about it is it is it makes the investor start thinking about the experience that that property manager's bringing. Because the truth is, when you get new leads, people aren't generally asking that question. They're not asking how many years experience does that property manager have? And I think sometimes those things are really, really important to value the property management work. But I likened it to the hairdresser.

Speaker 1: 32:51

If you go to a hairdresser, there's a price for the apprentice to cut your hair, for the senior to cut your hair and for the business owner to cut your hair and you get to choose which one.

Speaker 1: 32:59

And the thing is, is that like, personally for me, I don't actually I don't actually value hair that much, so I'm actually quite happy to have that junior do it, but there are going to be people that do value that fee and they can pay the proper price for it, and so that sort of was my mentality when it comes to it, because I do appreciate that there are going to be some landlords that don't value a management, a property manager.

Speaker 1: 33:26

Unfortunately, there's people out there and they're probably sitting on the verge of privately managing, you know, or they are those people that privately manage, but there's a little bit of them that are like oh, I probably should, you know, get someone to do it A little bit. Like you know, I probably shouldn't cut my own hair, I probably should go to the hairdresser because it's just going to end badly if I do it myself. So I think that like that for me was like my mentality when I was sort of trialing that and I don't know if it's going to stick around or not. But I just definitely want to try it and see over the next six months whether it does make a difference, and I'm already seeing a difference. I think that it's good for the owner mindset to think about that when choosing a property manager.

Speaker 2: 34:08

Yeah, I would even mention hey, we can put you onto our property manager apprentice because it's cheaper. But the thing is, is what the hairdresser is doing is they're tapping into the biggest fear that ladies have is having a bad hair day. They fear that more than anything. Okay, and they tap right into that fear. So for us again, owners are looking for a hero 95%, not the 5%, the crappy ones you don't want anyway and just send them down to your cheaper competitors. They're looking for that person that's going to give them a good tenant, get a quality rent in the shortest possible time, and that's what they're really losing sleep over. So when they come up with but the other agent is cheaper, or if you can match the fee, there's simply just this need to negotiate. So you've got to become good at the game and the dance of negotiation and have an effective response and have it trained, have it repetitious in your mind over and over, because when you're under pressure it'll just fall out of your mouth. But I promise you that script that I gave before about the other agent being cheaper you are not going to remember that when you're under pressure. So you have to practice it All right. So anyway, I know this has been a longer than normal podcast for you, ashley, and I really appreciate that you've allowed it to go this long. But, everyone, if you want the book, look the book is free. We've paid for the printing. All you've got to do is pay for shipping or you just go to winyourworthsecretscom. But, ashley, I not only go through how to get the best fees of new business. I share all of my 20 years of experience on how to increase fees with your current owners and this is the method that I've used over 20 years with hundreds of rent rolls over three countries Australia, new Zealand, united States. So the book.

Speaker 2: 35:53

I called a guy the other day and I know in his business he's got an extra million dollars a year. So basically, what I know is that I can find, if you've got a hundred properties, I should be able to find an extra 50 grand, so $500 a year extra at least. And I called this guy up and I said I said, mark, did you see it? I sent you the book and he said see what? And I said I stapled it on page 206, a million dollars. Did you see it? He says no. I says well, from page 206 onwards, if you put that into place. There's a million dollars in your business because he's got 2,000 properties, a million dollars a year or $91 a month, and that obviously broke the ice. And you know, very funny Darren, it's just showing there's so much money to be involved in your rent role. Just go and get it, just do it. But you've got to deal with the big butts first.

Speaker 1: 36:45

Yeah, well, I mean, I got the book and I've been in the industry for a long time and I have to say like for me, even reading this was still good from a learning point of view, but also just that reiteration. So for me. So I don't care how much experience you've got, people can actually still benefit a lot from this book. Um, I do have a but that you haven't mentioned and I want to see what your answer is, because I sort of get it and I am really good at having butts as well, and I sort of get it, and a few people have um mentioned it to me lately and I'd love to hear what your response to this one is, because I reckon there'll be people listening to it that will have the thought. But, darren, I work from home and don't have the swing overhead.

Speaker 2: 37:26

I had this the other day, I know, tell me, I'm dealing with a property manager I'm not going to say where, because she's part of our coaching and she's this quality property manager with 15 years' experience. She's coaching and she's this quality property manager with 15 years experience. She's working from home and she's 20 percent less in her management fee than the crappy agents down the road that are run by bosses that don't care about property management and just focus on sales. And I just we're working on the worth. So we're working on the points of difference. We're getting them into place. I've got her the handbooks and all of that stuff and we we're going to do training around that. I've got to build her work.

Speaker 2: 37:58

But the point is it's not about your expenses, people, it's about what you bring to the table. And there are property managers I know in Perth that I got years of experience. They're absolute experts, but they feel that what they offer is no different from the general agencies down the road and therefore they struggle with their fees. But the point is is that what you bring to the table if you've got experience and what you bring to the table is what I'm after you are that hero that I'm looking for. I don't care that you work from home and you don't have to tell people you work from home.

Speaker 2: 38:37

I've even encouraged people if they've got a background, like with me, I've got a painted wall behind me, a green screen, so you don't know if I'm working from home. In fact, I've got another image. I'll just put it up here and for those people that are listening, I'm just putting up a blurred office, All right. So look at that. You now think I'm working in an office office, All right. So look at that. You now think I'm working in an office. You just pretend you're working in an office, but you don't have to in your worth, factor in a lower expense base. It's what you bring to the table is what people are painful.

Speaker 1: 39:14

I like that. That's a good way of just saying it's not about the expenses painful. I like that. That's a good way of just saying it's not about the expenses.

Speaker 2: 39:24

I think that's a simple fact. It's about the peace of mind and it's about how quickly you can calm that anxiety and be the solution to their pain of what they're losing sleep over is. They're scared of the tenant from hell and they're scared of their mortgage not being paid and they're looking for a person that can give them relief as fast as possible. They're not thinking about that. You're working from home. It's you've got to be really careful about that. I invite anyone out there. If you want to talk to me about getting better fees, increasing your worth and all of this, just book into my diary at getbetterfeescom. That connects you straight into my diary. Let's have a chat and let's see what, what you know, what, what can be achieved in your business amazing.

Speaker 1: 40:01

So you did say that if there was a gold trophy it would go to perth, so I think that's a that's fair enough.

Speaker 2: 40:08

It's in the book. It says perth is property management feed paradise.

Speaker 1: 40:12

I've even printed it in there who do we have in last place? Are you allowed to say who's in last place? So worst, worst in.

Speaker 2: 40:18

So worst, worst in Australia, out of the big cities is by far the wooden spoon. Da-da, da-da, da-da gets awarded to Brisbane. Really, there's even worse than Brisbane. There's Gold Coast and Sunshine Coast is just terrible, really. Yeah, absolutely, brisbane is the worst. So number two is Adelaide. All right, from best, all right. So Perth is number one, adelaide is number two, sydney would be a sort of a three, melbourne would be four and Brisbane is the worst. At number five, auckland's better, a bit better than Brisbane. I don't know why. I thought, from a fee-charging point of view, brisbane I don't know why I thought From an overall fee charging point of view.

Speaker 1: 41:00

Yeah, I don't know why. I thought Sydney would be the bottom for some reason. But how interesting. I didn't know that.

Speaker 2: 41:07

So here is some. I'm doing a national tour coming up and I know that this podcast people could listen to it a year after. So there's no use going into about the national tour, but let me just give you some stats. So would you, um, would you ever not charge a marketing fee?

Speaker 1: 41:21

no, we always charge a marketing fee yeah, and how much is your fee?

Speaker 2: 41:26

um, I think we try to get 220 where we can, all right so brisbane is the only place where 35% of agents do not charge a marketing fee.

Speaker 1: 41:43

But they get charged by real estate.

Speaker 2: 41:46

Well, I don't think that REAs go well. You live in Brisbane. We feel sorry for you. We'll give you a free deal. They don't do that.

Speaker 1: 41:52

No, that could fix the answer cost.

Speaker 2: 41:53

But they think that what's the leasing fee?

Speaker 1: 41:58

for it's the big buck, it's the big, but it's the big. But that's the viewings and the applications. I know, I know, I know.

Speaker 2: 42:04

So yeah, again. I mean you know it just goes the stats here. You'll be horrified by what you see, but you know, we get routine inspections really easy in Brisbane. But 98% of agents will not charge a routine inspection fee because they think it should be part of the management fee, which they're completely wrong. Owners will pay a routine inspection fee. They don't know the fee market as good as what you do, so anyway, it's just. If you saw the stats here, it is shocking.

Speaker 1: 42:34

Well, I've done my little summary in Ash's words, with regards to what I've taken away. For me, it's being happy with the worst case scenario. So the worst case scenario of you saying no to a client, that you're not reducing the fees, is that you might not get it, and it's not a big problem because you don't want it anyway. And I think that it's good for people to know what the worst case scenario is, because why wouldn't you give it a go in getting those increased fees or those extra fees? Because it's not. You know what I mean. It's not the end of the world if they just say no and then you go. Okay, fine, I'll move on to the next person. So I think I don't know what people are so worried about. I guess is probably what I'm getting with that one.

Speaker 2: 43:20

But they are worried about because the big butts so the big butts usually win over, unfortunately. You know, I feel like I'm holding a candle to the wind with the people so much more discounting than what I can do to try and reverse. Um, but anyway, and so again with you on the book. Also, ig, go to IGTCentralcom. You'll find the book on there. Plus there are other books as well, but they're all free. You just got to pay shipping.

Speaker 1: 43:44

And also the importance of not only BDMs reading them, but property managers. I know that the last event that you had in Perth, we actually brought the whole property management team and you need to have them on board, like the whole office needs to be on board. So, if a team and you need to have them on board, like the whole office needs to be on board, so if you get one of these books, get everyone to read it. It's not just the bdm, it's the property managers, it's the business owner, it's everybody. Um, everyone's part of it um, in in holding that value. So that would be my tip as well if you do have um the books, or if you um, if you order one, so um, yeah, that's really, I think, a really important part of it cool, all right.

Speaker 2: 44:20

Well, ashley, been a pleasure. Thanks so much for having me on your show and again out there. I just want to challenge you people. Your big butts aren't true? All right, they are not true. Kiss, good, kiss your butt, goodbye, um and uh. You'll be able to earn so much more so excellent.

Speaker 1: 44:38

Thank you so much, darren. Chat to you soon all right, thanks everyone.