As a real estate photographer, how do you set your prices? What do you need to consider when you’re first getting started in real estate photography, or when you are reviewing your current pricing structure?
Here’s what we cover in this post (click on these links to jump to that section):
- Here’s why your photography pricing is so important
- How do real estate photographers come up with their prices?
- The problem with starting your photography prices low
- A look at the numbers when a photographer increases their prices
- How to calculate your own real estate photography fees
- Different pricing structures for real estate photographers
- Frequently asked questions:
But first …
Here’s why your photography pricing is so important to your success:
This is the big thing you want to take away from this:
Have you got that? “You can’t substitute great photography for bad numbers.”
In other words, you might be shooting really well, but if your numbers are bad, and your prices aren’t high enough for your costs, then your great photography won’t mean much because you won’t be able to stay viable.
I can’t emphasize how critical your pricing is to your success as a photographer. I think the reason why so many photographers go out of business within 1 or 2 years of getting started is because they are too cheap. They mistakenly think that starting off at the lower end of the pricing scale is what they need to do to start their business, but it is possibly the worst thing they can do, and by the time they realize that it’s too late.
So let’s look at what most photographers do, and then we’ll go through the right way to establish your pricing structure.
How do real estate photographers come up with their prices?
From what I’ve seen a lot of photographers do something like this:
- Have a look at what other real estate photographers are charging in their area.
- Work out where they sit in terms of quality in relation to those photographers. Are they better than the cheap photographer, but not quite as good as the expensive photographer? If that’s the case then they find a spot in the middle.
There are some pretty obvious problems with this approach.
- This method doesn’t take into account your expenses, and what you need to be charging to cover your outgoing costs. That’s because analysis of your own expenses never entered into the discussion
- Why use the judgement of others to determine your pricing? You don’t know how your competition came up with their pricing structure. For all you know they could have guessed a number, taken it to their mother, but she said it was too high, so they dropped it by $30. And now you’re going to base your pricing on that? You need to work out your own pricing, and then work out how you’re going to sell it to your client base.
- Another problem with this pricing strategy is that you place yourself in the middle … where the average people sit. Why would you want to sit right in the middle where all of the competition lies?
Let’s go through an example so you see what I mean …
The problem with starting your prices off low:
CC BY 2.0. Source: Flickr
You’re just getting started in real estate photography, so you start low because you want clients. You figure that they’ll all want to hire you if you’re cheaper than the other photographers in your area, and since you’re just starting out you’re not that confident yet, so you keep your prices down so that client expectations are lower as well.
You figure $70 per job isn’t too bad because you’re only at the house for an hour, and $70 per hour sounds great! And if you can do 3 of those in a day, that’s $1050 per week!
Except it’s not.
Because your costs are higher than you expect. There’s your camera gear, and insurance, and travel gear, not to mention travel time, editing time, booking time, internet access, your computer software, batteries, more gear …
You would probably be spending at least half of that amount from each job on extra costs, not your take home salary. That takes you down to about $500 per week. But then real estate has its quiet periods as well, and depending on where you are that could be a month to 4 months or more every year.
Build your clients – only to lose them when you do a price rise?
But let’s say you do really well with your introductory price, and after 12 months you develop a solid base of clients. So you decide you want to lift your prices up to where you really want to be, at $125 per job. The problem is that you’ve attracted all of the low cost, bargain bin, pay-as-little-as-you-can clients, and so when you raise your prices significantly the vast majority of them will leave you for the new cheap photographer in town.
So you raise your prices just a little instead, and spend another 12 months doing $80 photo shoots, working 12 hours a day, and hating it. Hating it.
The solution when you are getting started?
Charge reasonable rates at the prices where you want to be, not where you feel you have to be because you’re new to the game.
After all, having the lowest price is not a sustainable advantage. It’s not something you can keep going with, because either someone comes in cheaper than you eventually, or you find that you’re so busy making nothing that you have to adjust your prices up.
So, if you aren’t going to have the cheapest price, and the next cheapest offers no legitimate advantage, you might as well stop worrying about where you are on the price ladder altogether.
A look at the numbers when a photographer increases their prices … and loses some clients:
Now let’s take a look at how the price of a photography shoot can work to your advantage. Assume a photographer is doing 2 shoots a day, 10 per week, and 40 over 4 weeks. If their photography price averaged $150 per photo shoot, then:
40 shoots at $150 each = $6000 in 4 weeks.
But if the prices were increased so they averaged $200 per photo shoot, then:
30 shoots at $200 each = $6000
… or 75% of the photo shoots they were doing.
However, if the photographer put their prices up but lost only 10% of their business because of the higher prices, they would make $7200 over four weeks (36 shoots at $200 each).
So if we take this over a full year of 48 weeks, leaving four weeks of unpaid time per year to allow for holidays or quiet times in winter, then:
At $150 per shoot doing 10 shoots per week for 48 weeks in a year = $72,000.
However, if the price rises to $200, but they lose 10% of their shoots, then:
At $200 per shoot doing 9 shoots per week for 48 weeks in a year = $86,400.
Do you see the difference there? With their $150 shoot they’re doing $72,000 per year, but increase that to $200 per year and lose 10% of their clients, and they are doing $86,400.
That’s a pay rise of $14,400 more for the year. And that’s for 36 photo shoots in four weeks instead of 40.
Let’s look at another example …
This time we’ll do a small price rise of just $10, a move that will often be easily accepted by your clients.
So doing 40 shoots over 4 weeks at $150 per shoot = $6000
Let’s increase the photography fee to $160, and still do 40 shoots over 4 weeks = $6400
The increase of $400 means that this photographer would need to lose 3 shoots over that period of time in order to be $50 worse off with their price increase over that 4 week period. However, in order to be significantly worse off with a drop of $1000 a month, that photographer would need to lose 9 shoots in that time. Provided they had been delivering good service, and the quality was maintained, do you think that photographer is going to lose 9 shoots over 4 weeks over a $10 price rise?
I doubt it.
So what if you were to raise your prices across the board by $10 next month, and then do the same thing 6 months later? If you’re still doing the same volume of work, those two $10 price rises would mean an extra $9600 for you when extended over a 12 month period. That’s pretty cool for such a low risk move!
Pricing for your photography can work for or against you. It’s your choice.
So how do you get clients in a cheap market?
One of the things I consider is this: “Do clients only choose on price?” And the answer is ‘no’. Other factors come into play, otherwise all of your real estate agent clients would be driving really old, beat up cars and living in trailer parks (or caravan parks, for my Australian friends).
What can you do when you want to charge higher fees, but you’re in an area where there’s a lot of pricing pressure?
If you want to buy a new camera, does the place that is selling that camera influence what you would be prepared to pay in that particular store? It probably does, and here’s what I mean …
Let’s say you’ve got two stores where you can buy this awesome new camera body – a premium-level store in your town that is known for its excellent service, and an online store that you know nothing about.
What would you be prepared to pay for the camera at the unknown online store?
Now, what are you willing to pay at the premium-level store in town?
A lot of photographers would be willing to pay extra for a camera if they are purchasing it from a place that has a reputation for excellent customer service with knowledgeable staff, that responds quickly to enquiries, and that is well-known within the photographic community. Why?
Positioning.
What’s ‘positioning’? This simply refers to how you portray yourself to the market, and that gets translated into customer perceptions of what your target audience thinks about you and your business.
There have been a lot of studies done into positioning and the impact it has upon pricing, and the relationship is pretty clear – positioning and pricing are linked, so if you change one it’s a whole lot easier to change the other.
Do you see how you can use that in your business? If you’re in an area where there are cheap real estate photographers, work on positioning your business as the premium-level service provider in town, rather than the unknown online store, and you’ll make it a whole lot easier to market yourself.
To make it as easy as possible for real estate photographers who join my coaching program I’ve created a lot of the necessary tools already so they can get this stuff implemented quickly, but hey, that’s how we roll!
How to calculate your own real estate photography fees:
So how do you figure out the minimum amount you should charge for your photography?
First of all you need to calculate your fixed expenses for the year. How much will you spend on fuel, internet, phone, insurance, computer upgrades, camera gear? Add up all of your expenses until you come to a total figure for a 12 month period.
Next you need to work out how much you want to take home as your salary, and add that to your expenses.
So let’s say you have expenses of $10,000, and you want a salary of $50,000. So your target is $60,000 for the year.
Now work out how many days you’ll work. If you’re working for 48 weeks in a year, and doing Monday to Friday, then that’s 48×5 = 240 working days per year.
So to work out what you need to bring in each day, do: 60000/240 = $250 per day.
So in that example your minimum daily dollar target is $250, and that’s what you need to bring home every day for 48 weeks a year (though this doesn’t factor in your local taxation laws, so add that into your equation as well).
Got it?
Here are your action steps:
Your expenses = $ ____________
Your salary = $ ____________
Add the above two numbers together to give you your annual sales.
How many weeks a year will you work = _______ x 5 = _______ working days per year.
Therefore, your minimum daily dollar target = annual sales / _______ working days per year = $ _______
Does your current pricing structure allow for that?
If you’re currently doing shoots at $100 each, and you can only fit in 2 per day, then you’re never going to reach your target because you’ll only be able to do $200 per day at the most.
So work out what your minimum daily dollar target is, then work out how many shoots you can do or want to do each day, and then figure out how much you need to price your shoots at to reach that daily dollar target.
What about value?
Having said that, pricing for photography isn’t just about what it costs you. They’re not just paying you for your time. They’re also paying you for the value that your photography brings to their marketing campaign.
We know for a fact that, on average, homes with great photos will sell for more than homes with bad photos. So you are adding value to a home, you are putting dollars in the pocket of both the real estate agent and the home owner, and you are giving them not just the time on the shoot, but the years of experience you have behind you. So you might want to factor that value-add into your pricing as well.
Should you charge extra to work on weekends?
This is entirely up to you – some real estate photographers do charge extra (I would double my rate), but others are happy working at the same photography rate. It possibly depends on how many hours you work from Monday to Friday.
I would often be working for 50 to 60 hours, and so the weekend was an important time for me to relax, unwind, and catch up with my family and enjoy life. If a client wanted me to give up that time, then I was going to make them pay for it. And often when people would call up saying that they needed the shoot to be done on Saturday, they were often willing to wait until the Monday if it meant they saved money.
Make the most of your time – outsource your photo editing
Having someone else do your photo editing for you sounds perfect, but it’s not right for everyone. In fact, for some people it’s definitely the wrong thing to do.
In this blog post I’ve provided you with a video and a PDF worksheet that I’ve designed for you so that you can enter your numbers and determine if outsourcing your photo editing is good for you, or not.
After all, it’s (almost) all about the numbers.
So have a look at this PDF on when to oursource your photo editing, and you’ll see:
– The three questions that you’ll need to answer with a ‘Yes’ to be really sure that outsourcing is right for you.
– The maximum amount that you should spend on photo editing, and whether your photography pricing fits within that.
So whether you’re currently outsourcing your photo editing or not, I think you’ll find this self-assessment to be a really helpful way to see where you’re at in your business right now.
How do you know if you’ve got your pricing right?
We went through this discussion with a pricing expert during a group coaching call that I ran in early 2016, and here’s some advice from this pricing expert (who normally works with large corporations):
Source: Real estate photography pricing – advice from a pricing expert
Further to those comments about how much resistance to your pricing you should face, I would also suggest that about 10% of clients resisting your pricing is about right. As our expert above said, if there’s no resistance then you’re too cheap.
Different pricing structures for real estate photographers:
Photographers have lots of different ways of pricing their services, but here are the most common ones when it comes to shooting real estate:
Based on the size of the property
This is a popular method, especially in the USA where information on home size in square feet is readily available. So someone might price it this way:
- 0 to 2000 sq feet = $XXX
- 2000 to 3000 sq feet = $XXX
- 3000 sq feet plus = $XXX
Number of images
This is a smart way to go, in my view. Some clients want lots of lots of photos of even the smallest home, and others only want a handful regardless of size. And for us, the number of images is what makes the big difference in terms of setting up for each photo onsite, as well as the editing of the images after the shoot.
So these packages might look like this:
- 10 photos = $XXX
- 20 photos = $XXX
- 30 photos = $XXX
- 40 photos = $XXX
However, you can cop some resistance from agents who are used to getting 50 photos for almost nothing, so in some areas this can be a tough sell. But then is it worth working long hours at low rates, or do you need to find better clients? I’d go for the latter, as difficult as that might seem at first.
Time on site
This is another good way to go, and this is a format I used for many years. It allowed me to promote an “unlimited” number of images, because agents were used to other photographers setting limits (such as 15 shots). They liked it when I’d say that there are no limits – it just depends on what we can fit in to our schedule.
If they wanted an idea of the number of images, I could say, “Well, if the home is well presented, I would normally do 20 to 25 shots in that time.”
The other way this was good was that I could carefully structure my bookings. When you’re doing 2 or 3 shoots per day, you need to be able to set your times. You can’t be so flexible with how long you’re going to be at one property, and then say to your next client, “I’ll be there sometime between 1pm and 2:30pm, so just read a book until I get there.” That’s not going to go down too well.
So this pricing structure might look like this:
- 30 minutes = $XXX
- 1 hour = $XXX
- 2 hours = $XXX
Are you busy, or profitable?
One area where I see a lot of confusion from real estate photographers is when they talk about being really busy, as though that’s automatically a good thing. It is a good thing, but only if you’re being profitable. Because if you’re busy because you’re so cheap that you’re eating ramen noodles every night, then you have a problem.
In this video I talk about this issue of real estate photography pricing and profits:
Warren Buffett said, “Accounting is the language of business.” So with that in mind, here are some of the questions posed in the above video:
- Do you know your numbers?
- Do you know how much you need to be bringing in every week to make a profit?
- What will your profit percentage be if you hit those targets?
- Do you know exactly what it costs you to fulfill a photo shoot?
Can you answer all of those questions for your business? Or do you need to know the numbers in your business a little better? I would encourage you to dig into it, and have a chat with me if you’re a little confused by it all. 🙂
Frequently Asked Questions about real estate photography pricing
“I work in [insert name of town or city here] – what should I charge for real estate photography?”
There are a lot of factors that come into play, but here are a few questions to think about …
- What are your costs and expenses?
- How long do you spend at a property, and what are your standard travel times?
- What do you want to be earning as a salary?
- How effective is your marketing, as that will determine how much you can charge as well?
- What’s your target market – is it high touch / high quality, or is it high volume?
- How much value do your images bring to your clients?
- Do you want to offer a fee per photo, or a fee based entirely on the size of the home?
Once we work through those issues then we might be in a place where we can work on a detailed pricing structure. I say this not to be mean or to knock you down, but to acknowledge that pricing is complex with many contributing factors.
“How do I charge higher prices? There are some cheaper photographers around here, and I’m concerned that I won’t get the jobs if i charge what I ought to be charging to make a healthy profit.”
If you’ve recognized that charging more works better for everyone, you’re probably thinking, “How do I convince my clients to pay these rates??!” Maybe you’re starting to freak out a little, and maybe you’re thinking that higher prices just aren’t worth the risk. So what’s the key?
Marketing.
It all comes down to how well you can market your services to the people in your area.
I do have a series of posts on marketing for real estate photographers. But if you really want to get this happening, I invite you to have a chat with me some time. I have a coaching and marketing program where I help real estate photographers build a solid marketing system that will help them to get the clients they want.
“What do most real estate photographers charge?”
There’s some interesting survey results here from the 2015 SmartShoot photographer survey, where they suggest that the real estate day rate is $1082, and that the average price for a 1 hour job is $252. Remember though that this is from a broad range of markets, from large cities where higher prices are typically charged, through to small towns.
My own pricing (here in Brisbane, Australia) for a 1 hour shoot was between $245 to $395, depending on what was included in the photo shoot.
But what about elsewhere? I did a little research, and here are a few sample prices that I came across:
USA:
New York City: 6 photos in one hour for $180. One of the top NYC photographers charges $150 for the first photo, then reduced fees for each subsequent photo.
Houston, Texas: Under 2000 sq ft for $150, and 4000 to 4999 sq ft for $250.
Auburn, Alabama: 15 to 25 photos for $175, and add $50 for properties of 4000 to 7000 sq ft.
San Diego, California: An average home delivering 34 to 40 photos is $189, and includes a virtual tour. Another San Diego photographer is charging $200 for a 3000 to 4000 sq ft home, and adds $150 to that for a twilight shoot.
Phoenix, Arizona: 15 photos are $99 with a Basic Package, and 25 images are $149 in a Deluxe Package.
Canada:
Vancouver: Up to 25 photos is $180, and listings over $1.5 million are $210 for up to 25 images.
Montreal: For 18 to 30 photos it’s $150.
Australia:
Sydney, New South Wales: One photographer starts at $265, while another Sydney photographer was $295 for 6 photos, and then $44 per photo after that.
Hobart, Tasmania: For 10 to 12 photos this photographer charges $165.
Townsville, Queensland: 8 photos for $176, and additional photographs are $22 each.
What should you do with this information?
Whilst it’s important to know what other photographers in your area are charging, you should not use their pricing structure without first carefully assessing your own numbers to determine your minimum daily dollar target. You will also need to consider the number of jobs you can do in a day, and your own efficiency with the camera and with your editing.
“Should I give a discount to clients when they request it?”
Giving a discount can be fine … as long as you take something else away in return. For example, let’s say your $150 package includes 15 photos, what if you did a $99 shoot but only deliver 8 photos, and each extra photo is another $10 (so the client ends up paying more if they want 15 images)?
That way the client pays less for the basic package, but then they also receive less images. That would be the only kind of discount I would offer.
What if your current pricing structure is based around the size of the home (in square feet, for example)? Well, that’s one of the benefits of using a price-per-image model instead – it’s really easy to increase or decrease based on the number of images delivered. However, you can still offer a smaller package based around number of images if you currently offer a pricing structure based around the size of the home – just say that you also have a 10 shot package in addition to your other packages.
Can I help you with your pricing?
If you’re not exactly sure what to do with your real estate photography pricing, I invite you to leave a comment below, or send me an email and I’ll do what I can. As I’ve mentioned earlier, I do have a coaching program for real estate and architectural photographers to help them work through pricing for their services, so you’re welcome to find out more from me if you’re interested in getting this right for your business.