3 best practices that commercial and residential share
What are the differences between selling residential and commercial? The tools are largely the same. The difference lies in three distinctions: specialization, preparation and sphere of influence.
Specialization: In residential, you might specialize geographically or by type of housing. In the commercial arena, you might specialize in land, industrial, retail, institutional sales or leasing. Specialization is a key differentiating factor because each specialization requires a different regimen of preparation.
Preparation: Residential sales associates should get to know the neighborhoods and pricing variables within their target markets, the builders in their community and issues that relate to quality of life such as school districts, employment opportunities and shopping. Commercial practitioners must understand zoning, future-land-use maps and financial calculations such as the capitalization rate, internal rate of return and capital accumulation.
Sphere of Influence: Sphere of influence encompasses the most important element of real estate marketing. People generally like to work with people who understand them. Many coaches encourage residential sales associates to start working with customers who live in or near the neighborhoods where they live. The reason is that people with similar cultural and economic characteristics have a better understanding of the needs and concerns of people similar to them. The same can be said of commercial real estate. For example, people from families who farm have a special understanding of the land, and people from a manufacturing background have a special understanding of the needs of industrial property owners and users.
SOURCE: Michael Levine, GRI, CIPS