Pricing

- Let's jump straight into the burning topic everybody wants to know, which is how much should I charge for my real estate photography? And I'm just going to disappoint you right out of the gate by saying, I don't know. I really don't. I do know what not to charge, and I know how to figure out what to charge, and that's what we're going to spend the next few minutes doing. We're going to figure out what's right for you to charge for your real estate photography. Now, I think that the place to really begin with that is to establish what it is we're charging for. And that may seem really simple, like we're going to go take pictures of a house so that they can sell it. But what really, when you boil it down, is the thing that we're taking money for? Is it our time to go and shoot, is it for the photographs themselves, some combination? And when we say we're going to sell a photograph, what does that really mean? So I'm going to bog down for just a second here into something that might seem a little arcane. But we don't sell photographs. And this is true throughout the photography industry. In general, with some exceptions, we don't sell 'em, we license 'em. We rent these photos out, but the ownership will always stay with the photographer. And I know I'm starting out with something that seems a little bit distant, but we're going to come back to this again and again and again while we're having this conversation. It's a very key point. Now, having said that, there are some different models that people use to charge their clients. I think there's one, in particular, that works well, but I'm going to run through the most common ones. Start with charging per photo. And this is a very elegant, simple solution that I like very much, but there are people who charge their clients by the square foot, so there's a different rate for a small house versus a big house. There are people that charge their clients differently by the selling price of the house, so that a cheaper house is cheaper to photograph and a more expensive house is more expensive to photograph. There are people who just do a flat rate, who just say, you know what, it's going to be 100 bucks, 200 bucks, whatever it is, and I'm just going to come and shoot the house, whatever that means. Now, some of these sound really compelling, in particular, square footage. It sounds really logical that a little house shouldn't be as hard to photograph, shouldn't take as long to photograph, maybe doesn't take as many photographs. And a bigger house, that's going to be really difficult and take a long time and there's going to be more shots and so it makes sense. And it does a little bit. In practice, though, the smaller houses can be really hard to shoot. They can actually be much more difficult than the big houses. And the big houses aren't necessarily harder to shoot, nor do they necessarily require more photos. So what happens is you end up in these situations where you have, for example, say a 1,000 square foot house, which is not particularly large, and your client might want you to make 20, 30 photos in there. And, then, you may end up in a giant mansion somewhere and they might only need 5 or 6 photos of that house. That happens all the time. You'd be surprised how sophisticated the marketing gets at those levels. And they may be really quite easy to shoot. Sometimes, those places have fantastic light. So, then, how do you justify the fact that you're charging so much money for such little work, in some of those cases, and so little money for something that is, frankly, very difficult to do? There gets to be a real disconnect. Same thing goes with charging on the price, because the price of a house does not always follow the size, especially, like, in the Bay Area, the neighborhood you're in has a lot to do with that. So that brings us back to charging per photo, and I just think that this is the most direct, simple, elegant, logical way to do it. A photo is a photo is a photo. Yes, some of them are easier to make than others, it averages out. And it's just how we're used to paying for things. When you walk into the grocery store to buy corn, you're going to pay per can of corn that you buy. They're not going to ask you the size of your dining room table, they're not going to ask you how many people you're planning to feed with that can of corn, they're not going to ask you how long it's going to sit on the shelf. A can of corn is $1.39, period. I think that's how photographers should charge for their work as well. Make it a direct one to one correlation between the photograph and the price. Keeps it real simple, keeps it predictable, and allows you to average things out to where it works for you. Now, having said that, we can move on to how much should that be. Real estate agents like things simple. And the number of photos that you're going to deliver is going to be a key factor, especially when you're doing it on a per photo basis. I always like to present it in packages, again, as a way of keeping things very simple and very predictable for my clients. Rather than say, well, it's whatever it's going to be, 10 bucks per photo or 20 bucks per photo and then leaving it kind of open, "Well how many pictures is it going to be, Scott?" And I'm saying, "I don't know." I would say, look, standard real estate shoot, right, the medium of the world, is going to be 20 pictures, period, and most of your clients are going to go for those set amounts. They're not going to say, "Oh, gee, I only need 18 photos." They're going to say, "Yeah, yeah, yeah. "I want the 20 photo package. "No, I want the 30 photo package." So you set your levels and make those the standard stops from which they pick. You give them a menu and they'll choose from those options. So back to how much. There's no questions that there are some regional variants out there. Speaking within the United States here, the prices that you're going to get in, say, Indiana, Kansas, that area, are not going to be the same as what you're going to get in Manhattan, L.A., San Francisco. For one thing, the budgets that your clients are dealing with are very different. A $100,000 house in Indiana is going to be a $1,000,000 house in the San Francisco Bay Area. So right there, the dollar amounts that we're starting out with are vastly different, the clients are working with different budgets. Cost of living is also a factor as well. So, in terms of establishing your rate, there's a couple of different ways that you can do it and step one, to be really honest, is to sit down with an Excel spreadsheet and do a cost of doing business worksheet. It's called a CODB. You can Google that one, CODB. Google it as a CODB Photography and you'll get a bunch of pre-formatted Excel worksheets where you can plug in your costs, and you really want to be conservative with this. Estimate high, because that's how it's going to work out. Your camera is going to break one day, you're going to want to upgrade your lenses, you're going to need to buy gas for your car. At some point, you're going to want insurance. You're going to have all sorts of unexpected problems. Taxes, if you've never been self employed before phew, that's a big one. You're going to need to be prepared for your tax bill, ouch. Do your homework and figure out what your real costs are and then you move to the next step, how much are you going to charge. A friend of mine names Larry Lorman once came up with this amazing formula where he tied the price of a real estate shoot to the cost of getting a furnace inspection. When he first pulled this out, I really laughed, and I was like, "Larry, you're crazy." But it actually works. His formula is this. A real estate shoot should cost approximately 1.7 times the cost of a furnace inspection, which sounds just nutty, but it kind of works. So, this is a good next step, is to find out what the other vendors that your clients are working with are charging. You're not the only person that they're hiring to do things for their listing. There's the furnace inspection, there's the termite inspection, they're probably getting a cleaner to come in and clean the place, they're probably getting the windows washed, they're getting the grass cut, somebody comes and plants a sign in the front yard, right. There's all this stuff, but they're coordinating, and at the end of it, you're coming in to take pictures after everything's done. It's a pretty good idea to find out what those other people charge. And, I got to tell you, the first time I walked into a listing, and I was really clueless about this stuff, and the window washers had left their invoice on the kitchen counter. And I looked at that thing and my eyes popped out of my head, because they were charging a multiple of what I was charging. And I was like, okay, I don't want to disrespect the window washers, but you know what, my overhead's a little bit higher than theirs is. It was a real wake-up call for me, in terms of what my clients were used to writing checks for. And when you start thinking about where you really fit in that ecosystem, the photographs are pretty important. So put yourself relatively high on the ladder in that. So, again, whether you want to use the furnace inspection formula, figure out what your clients are used to, and that's going to give you some sense of where you probably ought to be. Of course, you've got to bring the value, but that's what all the other videos in this course are about. Now, the next thing it to think about how this business really works and that is to say it's a volume-based business model. Most photography doesn't work this way. Most photography, you're, well, I mean, my day-to-day work, if I shoot six days a month, that's a pretty good month. Real estate photographers, on the other hand, are going to shoot six times a day sometimes. Two, three shoots a day is very, very common. There are people who do four, five, six. I've heard people doing seven photo shoots in a single day. That's pretty extreme, in my book, but the point is you're going to be out there, in the field, every single day, doing multiple shoots. So the numbers start to add up, and we can kind of break that down. Let's just throw a number out there and say you're charging $100 for your standard real estate shoot. So let's do that math. Times three a day, times five days a week, which is totally reasonable, that's $1,500 a week, time four weeks, which, totally reasonable, that's $6,000 a month. Now we're talkin', right, $6000 a month would actually work. Again, I think $100 bucks a shoot is way too low no matter where you are. We'll get into what a realistic range is in the United States in a couple of minutes, but pick some numbers and run through that math and you'll see where the numbers start to add up. It's a grind. You're shooting every single day, right, five days a week, maybe more. I mean, I never shot on weekends, but certainly people do it. Real estate agents absolutely work on the weekends. And start thinking about, what if it was $200 per shoot? What if it was $300 per shoot? And you can start making bank, and it's out there. So that's the way the business works, you can't look at it on a per shoot basis and, by the same token, because of the nature of the work, we tend to, it's not exactly flat rate, but a per photo model, you're planning on things averaging out. Sometimes you're going to have to travel a little further to get to the house. Some of the houses are going to kick your butt and you're going to just work so hard on 'em. Other houses are going to be incredibly easy. And it averages out, okay? What's the number? Typical range, again, there are people outliers, there are outliers on both ends of this. Somebody, somewhere, is shooting a house for 30 bucks, I guarantee it. And then, somebody else somewhere, is shooting for $3,000, I guarantee you. Mainstream, $200, $250, on up into the mid fives. Depending on the market, depending on who ya are, depending on how good you are. You're going to have to figure out where you are geographically, skill level, and really who your clients are, because there are real estate agents that are working on the bottom end of the market, and there are real estate agents working the top of the market. It doesn't always follow that curve, exactly, but there is a correlation in terms of what you can charge. When I got into this business in about 2005, 2006, somewhere in there, I was charging $140 for 12 photos. When I got out of the business in a mainstream way, and I finished shooting about 3 houses per day, five days a week, probably 50 weeks a year, I was charging $325 for roughly the same thing. Again, the number of shots did kick up a little bit. Anymore, I have a client that I'm charging a standard, architectural day rate too, and it's essentially real estate work. I treat it exactly like I do any architectural or interior design shoot. It's a very small, limited shot list. But the end use of those photos is actually straight up real estate at a very high level. So this business exists on many, many, many levels and you want to stay cognizant of that in terms of putting yourself on the ladder and thinking about which way you want to go.