Conversion Rates

OTA = Online Travel Agency, which means those sites that sell the booking and take the payment for you.
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Alan Knighting
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Conversion Rates

Post by Alan Knighting »

Magsw has brought up an interesting point which is conversion rates.

All the evidence suggests to me that enquiries are down from previous years, certainly mine are, but my statistics show that conversion rates are up - a lot.

Does it indicate that enquiries are now serious enquiries from people who are coming to France and are trying to choose a property?

Does it indicate that the trivial browsers who are not at all serious are not now bothering?

Is the quantity down and the quality up?

What do you think?

Alan
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tansy
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Post by tansy »

Ha...you want me to answer that one Alan??!!!! Livepudlians :evil: :evil: :evil: :evil: :evil:

You could have a point....first enquiry for months just through for our house in St Germain - next June - from a Govenor no less in USA....what do I do???
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Alan Knighting
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Post by Alan Knighting »

Sorry. I should have excluded those most interesting and compelling ones which are phrased in the most immaculate English.

Apart from them??????????

Alan
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vrooje
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Post by vrooje »

Ooh, Tansy has a US governor possibly coming? You can't convince him/her to rent the Utah Beach house instead?

I would be completely open and say that you're thinking of selling that house, so couldn't take a deposit just yet, but you have this other house which is really lovely and would they like to rent that instead?

I think in general my inquiries are down only slightly. I'd have to check that for sure, though. I know that January/February didn't start off with the flood of inquiries that I remember from 2004, but it was a steady flow of them that did increase. I don't think my conversion rate has changed that significantly, though.
Brooke
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tansy
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Post by tansy »

Brooke - Utah is full for all of June most of July next year already with other folk possibly booking rest of July!

So I couldn't get my Govenor in :cry:

Did you get the floor plan I emailed you?

All the best

Tansy
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vrooje
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Post by vrooje »

Yes I did! And I can open it -- but I haven't had time to look at it, which is why I haven't replied yet. Will do so shortly. :)

Cheers!
Brooke
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paolo
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Post by paolo »

Alan,

Are these conversion rates for enquiries from ads, your own website, mags, or across the board?

I think my conversion rate is probably slightly down if anything this year, suggesting there is more choice or fewer punters.
Paolo
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Alan Knighting
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Post by Alan Knighting »

I should have made myself clear.

I meant simply the rate of converting enquiries into bookings.

My feeling is that most of the time-wasters have gone away, excluding US Govenors and linguistically gifted Nigerian businessmen of course.

Alan
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Post by A-two »

tansy wrote:You could have a point....first enquiry for months just through for our house in St Germain - next June - from a Govenor no less in USA....what do I do???
Hi Tansy,
My view slightly differs from Brooke's. I agree with 100% honesty, but if you tell him you are selling, you might as well tell him no - he is not going to book with you.

Is the decision to sell the house REALLY 100% firm? Maybe if you have a few smooth weekends in a row, things might not look so bad, or if you could get a whizzo property manager organized to iron out some of lumps and bumps, might you not keep it, then kick yourself to let the Governor go?

If there is even 1% doubt in your mind, I would go ahead as normal. Do you have the get out clause in the lease that lets you cancel the booking if you sell the house? If not, I can send you some suggested wording.

I'm not suggesting you mislead him or let him down at the last minute, but sometimes I do a 180 degree turnaround on my decisions. It really depends how firm you are about selling, but the fact that you posed the question at all tells me you are still not sure. The choice is to tell him yes/no/I don't know.

In my book, if it's "I don't know", then I keep going with status quo and status quo for you right now is a "yes, it's available".

Something could happen to him in the intervening period that might force him to cancel as well. That's just life. Keep going for now unless 100% positive, in which case you might not want to book anything more than 3 months ahead as Paolo suggested.
Waves from America
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vrooje
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Post by vrooje »

Hm, you know, I think Joanna is right!

I probably wouldn't book a house I knew was going to be sold. Good point. Especially as you don't have the other house to offer -- however that's good news in a way that you're already so full for 2006!

There has got to be a way to get a manager or someone you trust into the second house. Beach front property is an increasingly rare commodity, and you might kick yourself in 5-10 years if you sold it!

Then again, you might lean back, enjoy the relaxation, and thank goodness you got out of there! :lol:
Brooke
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Alan Knighting
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Post by Alan Knighting »

Tansy,

I know this only addresses one of your concerns about selling a letting property.

When I bought my present house part of the deal was that I took over the vendor's letting business. That's what I was looking for. He, the vendor, got in touch with all the people who had booked explaining what was going on and telling them that he had met Joan and myself and that were almost human. He offered them a full return of their money if they were unhappy and wanted to cancel. Guess what! None of them did.

Viewing wasn't a problem - it was done in January/February when there was nobody around.

Alan
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paolo
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Post by paolo »

That's a good point Alan makes, it won't just be wealthy Parisians who would be interested. If you have a house that gets 33 weeks (was it?) booked, you may appeal to property investors. I suppose that those 33 weeks need to bring in about 5% of the value of the house to make it worthwhile as a pure investment. But it's not my field at all.
Paolo
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A-two
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Post by A-two »

Tansy's rental business also has a value separate to the physical building. Her good name, her website, her contact list, all the hard work she has done to set it up has a value for someone wanting a turn key operation. At least that is what I have been told locally by real estate agents here. I'm not sure about value, but surely a few tens of thousands of dollars?

Rents always used to be 7%-12% p.a. of the capital value depending on where you were in the property cycle, based on current market value. The problem is, with property values rising so sharply over recent years, you only need to hold onto something for a couple of years and you can wipe a few % points off the yield you're getting. Rents have just not kept up with house price increases, so I think the norm now is more like 5% or even less.

We're currently holding steady at 4% based on current market value of our property, but I'm OK with that because the capital value has doubled in the 4 years we owned it. And that's where the real money is to be made. So the importance of the yield is relative - 4% in a rising market is better than 5% in a falling market because the rent is undervalued in the former, whereas the reverse is true for the latter, it's overvalued. These are gross rents by the way, not net. In a flat housing market, I'd like to see rent rises on a rental property over a couple of years as well as a decent yield that could carry me over to when the market is going to pick up again. Providing a property is paying for itself, it's worth hanging onto while rising market conditions prevail. That's really the bottom line when viewed in pure investment terms.

To answer Alan's question, our inquiries have dropped off a bit this year, but our conversion rate has increased. I expected this having expanded our website, so there are fewer questions to ask. We've had our best year yet despite price increases, but I'm still very slow for Sept thru Dec, which is absolutely the best time of year to be here, so hoping for a last minute rush.

Sorry, I can't seem to stay on topic. :roll:
Waves from America
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