All posts by Scott

What Sells a Home and Why Most Agents Won’t Like This Post

Chances are you’re not going to like this article. 

 

What I am about to write flies in the face of the vast majority of real estate agents in North America today.

 

That is, the number one thing that contributes to the sale of a home, in any market, is the price of the property.  That’s it.

 

Location, features, benefits…all of those have a price tag.  What that means is, if I had a dump of a house in a dump of a location, it would sell if the price was low enough.

 

That being said, what’s low enough for a buyer to want to buy may not, in fact, be low enough for a seller to want to, or be able to sell.  Yes, that was simple economics at it’s best and it lends to explaining much of what has gone on the last few years…the price a seller would/could sell a house for far exceeded the price a buyer would (and sometimes could) pay for the house.

 

Now, let’s get back to the reason you, and most agents, might not like this article.

 

Both when practicing real estate (May 1998-Dec 2006, top ten percent in my market 2001-2006), and more recently as a coach, I’ve heard the arguments against price being the number one reason homes sell.  Most of those reasons center around an agent’s ego and/or the huge misconception as to what their job actually entails, as well as some sort of misplaced loyalty to the seller and the price they say they want.  (Before I go any further, I’m not in any way advocating that you shouldn’t be loyal to your sellers.  I’m saying defending a random price a seller tells you they want, ignoring comps and any sense of reality, is misplaced loyalty.)

 

Some of the arguments from agents:

 

“If price is the only thing that matters, then we real estate agents aren’t needed.” – Guess what?  That’s actually kind of true.  If you’ve ever heard of a FSBO selling on their own, then you automatically realize selling a house can be done without a real estate agent.  The good news is that the vast majority of FSBO’s do not sell without the help of an agent (even if only on the buyer side – but most end up listing).  And, unfortunately for the FSBO seller, they get a very low list to sale price ratio as compared with when listed by an agent (both stats are published by NAR).  So, on some level, my fine fellow agent, you are definitely needed…so breathe a little easier.

 

“All you want to do is lower the price as far as you can, darn the seller, and take your quick commissions!” – A buyer will not buy something they don’t feel is priced correctly; plain and simple.  I’ll explain more about that later in this article.  In the meantime, I can only go on statistics/facts.  My personal statistics in my former real estate practice showed my listings selling for an average of 4-9% more and up to twice as fast my market’s average, depending on the year.  Simply put, I was getting my sellers more money, and selling their homes much faster than the market average.  So how was I harming the seller?  I don’t know many sellers that want their home to sit on the market for a long time, do you?  Do you know of any seller’s who want LESS money for their home?  I sure don’t.

 

And where does this false sense of loyalty to the seller’s price come from?  I’m sorry, but it’s so misplaced.  I always wanted to get as much money as possible for my sellers, and did my absolute best to make that happen.  But just because a seller WANTS a certain price doesn’t mean they’ll get it, or, in most cases, that it’s even realistic.  I’m sorry if the seller paid $400,000 and owes $350,000.  If the comps say it’s worth $275,000 then that’s what it’s worth.  Listing it at $400,000 so the seller can feel like they broke even does NOT mean the home is WORTH $400,000.  Nor does it mean they will get anywhere near that.  In fact, in my example, with it being so far overpriced, if there isn’t a significant price reduction, the house likely won’t sell at all.  How is that protecting the seller?

 

I don’t want to digress too much, however in a previous article I wrote on negotiating, I discussed the issue of many listing agents being egotistical about the price they set on their listings.  If a buyer comes in low, the listing agent scoffs and postures to the buyers agent about how the home is worth every penny of what it was listed for, etc.  Please.  The only true test of what a home is worth is what a ready, willing, and ABLE buyer is willing to pay…not what the listing agent or the seller thinks its worth.

 

“It’s not price, it’s marketing.  Staging, open houses, broker opens and advertising are all where it’s at.” – This is the reason for the big chasm between the average agent (selling between 2-5 houses a year, on average, according to NAR) and the higher producers (over 25 homes a year).  Agents who sell a lot of homes know how to SELL, and know that their job is to SELL the home for the most money possible.  Agents who don’t sell a lot of homes typically aren’t good salespeople, don’t actively prospect for buyers and sellers and think their job is not as a real estate SALESperson, but rather a real estate MARKETINGperson.

 

Simply put, you can market a house to the hilt, but it will NOT sell if the buying public thinks it’s overpriced.  In fact, today’s shrewd buyer who combs the internet and does their homework, won’t even look at home that they feel is overpriced; unless they think they can get a tremendous low-ball deal.  And, if you want to take a notorious low-ball buyer around so he/she can throw offers up on a wall and see what sticks, have at it.  You’ll end up doing a lot more work and probably be very frustrated.

 

So, let’s investigate some of these marketing ideas:

 

Staging – I’m always amazed at how someone comes up with something for agents that doesn’t sell homes, yet agents buy into it in droves.  Text “MOVE” to 12345 and receive no obligation information on this listing.  That worked for about a minute until buyers realized they would get called back from agents they didn’t want to talk to.  Now, it’s no better than a regular sign with a regular phone number or website.  Or, how about the private radio station that drive-by buyers can tune into and hear all about the house?  Way to go!  You just bought something that assures you of never hearing from your buyer leads!  They won’t need to call you to find out information because you gave it to them on their car stereo.

 

Staging is one of those tools that doesn’t sell a house.  Yes, the house should always look its best.  And, yes, if you stage a house, it will look better than the competition.  BUT…staging only works better to sell your house versus the competition if the home is priced competitively.  Let’s say you’re in a development, and two identical houses on the same street are for sale.  One is for $350,000 and NOT staged.  The other is for $425,000 and is staged.  The seller or agent who paid for staging of the $425,000 house doesn’t know anything about sales or economics and wasted their money.  No amount of staging in the world can trick a buyer into grossly overpaying for a house.

 

Open houses – This is the biggest real estate scam ever perpetuated on sellers.  And the funny thing is, many sellers will fight tooth and nail for the right to leave their house for multiple weekends in a row so that you can park yourself there for 4-6 hours at a time and put balloons out front.

 

NAR itself puts out a report every year that shows a very small percentage of buyers buy the home they saw open.  It’s usually around 1%.  That is an astonishingly low rate of return on your marketing efforts.

 

Open houses do provide buyer leads for the AGENT, not the seller.  All listing agreements should come with a disclaimer showing the past year’s NAR percentage of homes actually bought due to the open house.

 

Low producing agents love open houses because they haven’t been taught, or are too afraid, to prospect for business.  So, the idea of sitting in a home and having potential buyers come to them seems good.  Never mind that most people are just looking, and the percentage of leads converted to actual buyers (and the time it takes to convert them) is no better than a call in on a sign or website.  And let’s not mention the fact that you may sit all day at a house and have NO traffic.  God forbid if it’s a rainy weekend.

 

Broker opens –   These have a small chance of helping you sell the home because it can get you exposure to agents who missed it in the myriad of listings on the MLS.  However, it’s usually not worth doing a broker open until well into the listing term, and is most effective to get a price reduction for the seller by having the agents write their pricing opinions on a survey card (darn, there’s that pricing thing again).  And here’s the fundamental flaw - top agents, you know the one’s doing 90% of the business, are typically too busy to stop at broker opens.  So you’re exposing the property to a handful of agents who have nothing better to do than to eat your free lunch.  Look, I know I’m sounding harsh, but my big concern is that many agents think their job duties entail hosting and going to things like broker open houses and working on making a pretty brochure…things that DON’T help sell a home.

 

Advertising – Here’s another scam on the seller.  NAR reports a very small percentage of homes are sold as a result of being advertised.  I will admit they also report a slightly higher percentage of homes are sold as a result of the buyer calling in on a different home, so advertising can help (but the home still has to be priced right).  For the sake of this article however, I want to stick to the specific house you have listed, and I’m talking about advertising over and above the norm.  I mean the type of advertising where the agent thinks it’s the solution to why the home hasn’t sold in the last 90 days.  We all know that every agent does some form of advertising, whether it’s the MLS itself, the various websites that agents/companies have, the websites that pick up listings from the MLS, or the newspaper ads your company provides.

 

Here’s the flaw:  If your local grocery store paid for circular ads in your town’s Sunday paper, and advertised premium, no-filler, turkey lunchmeat at $50 a pound, how many people would buy it?  The answer is nobody.  Two things would happen.  People might still visit that store, but they would buy another brand of turkey lunchmeat (congratulations, you’re overpriced turkey ad sold the competition), or people will go to another store all together to buy that brand at its normal price.  In any case, the store could have spent millions of dollars on ads all over the place and it wouldn’t matter a lick in regards to the sale of that brand of turkey.

 

Yet sellers and agents all think that more advertising will equal a sold home.

 

The bottom line is that your job as agent is to educate the seller and list the house at a price that will cause the home to sell.  Stop kowtowing to the seller who wants to overprice the home.  Stop with the false sense of loyalty to a pie-in-the-sky price, against all reasonable economic sense as evidenced by the comps.  Stick to your guns, be professional and price it right.  Or, horrors, be willing to say “no” to the seller, and walk away from listing the home if they insist on overpricing it.

 

You’ll be doing yourself a huge favor, I promise you.  Even if another agent lists the property, don’t worry.  It’s not going to sell.  Look at your market.  Look at any market.  Overpriced listings don’t sell.  Why do you think there are so many expireds?  Oh, right, I forgot.  The agents all must not have staged those homes.  Yeah, that’s it.

 

Objection Handlers for Expired’s and FSBO’s

In our latest email detailing our upcoming telecourse, How To Take More Expired and FSBO Listings, I mentioned we’d post some free objection handlers from our book, Now What Do I Say? So, here they are:

EXPIRED:

We’re just going to take it off the market for now.

1. That makes sense.  And, I’m curious what will NOT being on the market accomplish for you?

*(The key is to ask this question, in a non-threatening way, and then don’t speak again until they answer that question.  They will tell you that they’re plans have changed, or that they’re frustrated with the market, or any number of things that will tell you if they really want to sell or not.)

2. I can appreciate you want to take it off the market for now.  So, what would happen if you left it on and got it sold this time?  Because the market is obviously not great, and the more time you take, the more money you could lose.  And if you’d be willing to meet with me, I’d be willing to show you how I/my company sold X homes in the last six months for top dollar.  Do you want top dollar?

I’m going to re-list with the same agent.

1.  I appreciate you wanting to give this agent a second chance, and yet I’m curious, do you think this agent will be able do anything differently this go round that they haven’t already tried?  Since you are considering re-listing, you obviously feel they did everything they could to get the home sold.  Doing the same thing again can’t possibly create a different result, can it?  Before you re-list, don’t you think you owe it to yourself to get a second opinion before you tie yourself down for another six months?

2. Stop for a minute and realize how hiring a different, aggressive agent might change the results you are getting.  You can make a decision now whether you’ll stay with the same results, or list with an agent who/whose company has track record of selling homes in X days.  Can you see why it just makes sense to meet with me?

FSBO:

Bring me a buyer and I’ll pay you a commission.

1.  Thank you, that’s great!  Let me ask you a question, because I have a concern about that.  It’s a great strategy to attract agents who will tell you they have a buyer when they just want to get their foot in your door.  I’d rather be very honest with and tell you I’m calling to show you how I’ve netted the most money for my sellers.  Is there any reason you would not want to meet with me if I could show you my proven track record for aggressively marketing your home and getting more you money?

2.  Thank you for the offer.  So, let me get this straight:  you’re willing to pay me 3% and you want to save the other 3%, right?  Okay, great, and I’m curious…after you pay for your own advertising, disrupt your family time showing your house at all hours, host your own open houses every weekend, negotiate with low-balling, bargain hunting buyers…if any actually make an offer, and then finally pay attorney fees, will you be saving anything, and, if so, will it really be worth it?

If we don’t sell it, we’ll rent it.

1.  I understand, and do you really want to be a landlord?  I know it’s frustrating right now, and can you imagine the frustration of chasing down a tenant for late rent, that your mortgage payment might be dependent on, month after month?  Not to mention getting repair calls in the middle of the night, and generally just being chained to the house for a year at a time.  Don’t you just want to get it sold?

2.  You could rent it, but what about capital gains?  You should really check with your accountant.  Renting it could cause you to lose money because the tax status of the property will change.  You could sell now and pay no capital gains, or rent it and when you decide to sell it you end up paying thousands in capital gains taxes.  That’s not good, is it?

In Now What Do I Say? book and CD’s we give 6 different handlers for over 70 different buyer and seller objections.

In our How To Take More Expired and FSBO Listings, we teach you exactly what to say and how to say it, and what to do and how to do it.

Sign up, now!

Real Estate has changed, have you?

Sure, the title of this article is not profound, it’s actually rather obvious.  Yet, suprisingly, few agents have changed with the times.  They haven’t changed their attitude, their focus, or the way they do business.  Many are simply lamenting about how hard real estate has become.

At a certain point, in order to move powerfully forward and be successful in any endeavor, one needs to assess what is, as opposed to what was.

Experts agree that focusing on the present moment and what you want in the future will get you to your goals.  Conversely, focusing on the past will keep you stagnant, or ultimately contribute to your failure.

How this relates to real estate is that we have to realize that “this” is how real estate is, and probably will be for some time.

By “this”, I mean the business of real estate is currently: lots of inventory, short sales, foreclosures, upside down sellers, finicky buyers who can’t make a decision, buyers who look for any excuse to pull out of a deal, tougher mortgage criteria, deals falling apart – even right up at or near the closing date, deals not closing on time, etc.

Now more than ever it is harder to find people who are ready, willing and able to buy or sell, and harder to keep the deals together when you do find those people.

Again, that’s an obvious statement.  So then the question becomes, “Yeah, so what?”

Well, you’re a professional real estate salesperson, who, hopefully, either has, or is starting, a career.  You didn’t get into this business thinking you’ll hang around for 6 months, or so, until your big break comes in show business, did you?  This is what you do for living:  find people who want to buy and/or sell real estate and help them buy and/or sell real estate.

I know, in this market, some agents have had to take 9-5 weekly paycheck jobs in order to stay afloat, but their goal is to still be a successful real estate agent.

The point is, regardless of how things used to be, the landscape of real estate is what it is today.  So, we in the industry need to change our reference to the present moment and powerfully move forward.

If it used to take you calling ten prospects for every listing you took, the game is likely different.  Now, you probably have to call fifteen or twenty just to get a good, qualified listing appointment with a seller who’s not upside down, etc.

Or if you did ten buyer side deals, typically maybe one or two would fall apart, and maybe one or two wouldn’t close on time.  Now, it seems like buyers are looking for and excuse to get out of deals.

Therefore, you probably have to talk to at least double the amount of people you used to have to call a few years ago, just to get the same amount of business you used to get.

Okay, Scott, enough with the obvious statements.  Again, so what?

What is so is that this is how real estate is, here in the present,and for the foreseeable future.  And many agents haven’t been able to change their attitude, focus and way of doing business to reflect how things are today.  They’re rooted in the past, and that becomes their frame of reference.  They say and think thinks like, “Real Estate is so hard these days,” and “Nobody has any equity to sell,” and “Buyers don’t want to buy anymore.”

CHANGE YOUR ATTITUDE:

So you have to talk to more people, and throw more deals up on the wall to see if they stick.  Real estate isn’t hard.  It’s not like the business became one of physical labor.  Last I checked, real estate agents weren’t required to dig ditches in order to sell real estate.  They still just have to talk to people, send some emails, fire off a couple of faxes, visit some listing prospects’ houses and take people around to see homes they want to buy.

They just have to do more than they used to have to in order to succeed.

Feel good about what you do for a living.  It will show, and it will help you succeed.

CHANGE YOUR FOCUS:

Forget how real estate used to be.  Forget what people tell you about the industry.  Do yourself a favor and look at your multi-list daily hotsheet.  I’m willing to bet you will find at least one house was listed, at least one went under contract/pending, and at least one closed.  People are buying and selling real estate virtually every day.  Sure, not as many properties are selling as once were, but if you did the math you’d find that there’s more than enough business for
you to get, regardless of how high your goals are.

Focus on what you need to do today to get homes sold.  That means think about who and how many people you need to talk to today to find out if they will buy, sell, or give you a referral.

Focus on what you want to do with the money you make from helping all these people.  Pay off debt, buy a car, send your kids to college, etc.  More so than your goals, focus on why you want to achieve them.

CHANGE THE WAY YOU DO YOUR BUSINESS:

You simply cannot wait for business if you want to succeed in real estate.  You need to talk to as many people as possible on a daily basis.  That’s your job:  talking to people. You need to talk to the people you know, and the people you don’t know (like expired listings).   And you need to talk to more people than ever before.

If you change your attitude and appreciate the business, change your focus and start looking from the present forward, and the way you do your business by getting front of more people than ever before, you will succeed at a level you never knew you could.

Pop quiz, hotshot!

Here we go.  You’re in real estate.  I’m going to assume this is your career and not just a hobby.  So, since it’s your career, answer the following questions as you read them…without looking them up.

How many active listings do you currently have?

How many pendings/escrows do you have?

How many closed deals do you have so far this year?

How many deals does your office/company have closed and pending year to date?

What’s your average list to sale price ratio (percentage of list price your listing sells for)?

What’s the market’s average list to sale price ratio?

What’s the average days on market for your listings (DOM)?

What’s the average days on market (DOM) for listings in your whole market?

How many homes are currently listed in your market?

What percentage of the listings you take sell? (last year and so far this year)

What percentage of homes listed are selling vs. expiring in the market? (last year and so far this year)

How many homes sold in your market last year?

How many homes have sold and gone under contract so far this year?

If you didn’t know the answer to at least 60% of these questions without looking them up, then clearly you aren’t treating your business, or this business, as a business.  Or, perhaps you didn’t know you needed to know these stats.

Either way, let me tell you now, in no uncertain terms, it is extremely important to know these stats.  Having knowledge of your personal stats, your office/company stats and the market stats will undoubtedly help you sell many more homes.

Imagine going up against Sally Superagent and showing the seller that for all the business Sally does, she’s only getting 93% of the asking price, while you are getting your sellers 95%.

Or, perhaps Rick Rockstaragent has promised to get the seller you’re trying to list a really high price, and you can show the seller that Rick only gets 50% of his listings sold, while 75% of yours sell.

The possibilities are endless, if you know the stats.

You’re clients don’t know what you know

One of the biggest blocks to good communication between people is the frame of reference, or point of view, people have when communicating.

Simply put, what’s going in your mind is most likely not going on in the person’s mind with whom you are communicating.  And, many people tend to think that everyone has their point of view, and is therefore on the same page as they are.  Actually, most people don’t think like that, they just have their point of view and go with it, unconsciously assuming that whomever they’re talking to is on the same page.

In real estate, agents are involved in the process of buying and selling real estate every day; whether by thought, conversations and/or actions.  Conversely, their typical client is not anywhere near as involved.

The communication breakdown occurs when the agent talks to the client as if the client is right there with the agent.

For example, let’s say you list a property and somewhere down the line an agent brings in a written offer.

Most agents will call the seller(s) and present the offer over the phone, which typically consists of telling the seller the price, down payment money, the settlement date, any contingencies, and maybe a couple of other items on what can be a 10-15 page contract.

This is pretty standard practice, and usually acceptable up until the contract is agreed upon and it’s time to get signatures.

But think about the following scenario.  This happened to me a coupe of times when I used to sell, and may have happened to you.  Take the same situation as above, except the buyer and seller never come to an agreement.  Now all your seller has is your say-so about an offer.

What if you then need to go for a price reduction?  You’re seller might suspect you of playing dirty pool to get them to reduce.

What if it’s close to the end of the listing and you want them to extend?  You’re seller might suspect you of fabricating the offer in order to get the extension.

But let’s take things one step further.  Let’s say you get an agreement on price, the buyer has signed everything, and now you want the seller to sign it.  So you fax, email, mail and/or bring the contract over to the seller and what happens?

All sorts of things can happen.  The seller simply signing the contract is only one possible outcome, and a low percentage play.  Most likely the seller will want you to go over the contract with them.  Many will want to take their own time (a day or two) to go over the contract themselves before signing.  And some will even send the contract to their attorney to look at it, before signing.

None of those things are bad, sellers should be informed and have representation.  However, many times the seller’s actions take the agent by surprise.  The agent didn’t even know they were going to use a lawyer, or the agent figured the sellers were just going to sign and have no questions.

Now, I know some agents present all of their offers personally in front of the sellers, and unless that’s the law in your market, I think it’s a waste of an agent’s time.  What I believe is more efficient, and will go a long way, is to cover your bases while on the listing appointment.

Leave a copy of a blank contract for sale with your seller after taking the listing (or email it the next day).  Tell them to read it and email you with questions.  Or better yet, call them regularly with updates and let them ask you when you call.  Let them know an offer will look just like that, but with the blanks filled in.  And, if attorneys are optional in your market, ask your sellers if they plan to use one.

This works just as well with buyers, too.  When you first meet them (hopefully in your office, and not at the property…but that’s a different post for a different time), show them a contract for sale and ask the same question about an attorney.

Have you ever worked with a buyer who tells you they want to make an offer on a certain property and then seems to take their sweet old time signing the contract?  Sometimes days go by and they finally get back to you with a bunch of questions.  God forbid it’s a hot property with the potential for multiple offers.

All of that could have been avoided if you got them on the same page as you before you started the process.

Can you see how just giving the client some information that they normally don’t have access to can do wonders for your communication with them?

As agents, you need to realize your clients aren’t used to the daily doings of real estate.  Even if you only sell a few houses a year, most of your clients have only bought/sold a few homes in their adult lives…and that’s not even talking about the first time home buyer.

Denzel Washington played Tom Hanks’ character’s lawyer in the movie Philadelphia, and he used to always say to people, “Tell it to me like I’m a 6 year old.”

I’m not saying talk down to your clients.  I’m saying that you shouldn’t assume your clients know what you know about a real estate transaction.  Walk them through the process.  Let them know what’s coming before they get to that point.  Let them feel comfortable.  Remember, this is a lot of money to the buyer/seller.  And it’s a contract.  People get really nervous about their own money, and about contracts.  So the more you can help them with in the beginning, the easier it will be for them to listen to you and be okay with what’s going on as it’s happening.

Help your clients get on the same page as you.

Are you a good communicator?

Communication skills are essential in sales.  Simply stated, the better one is at communicating, the more successful they will be in sales.

I know I just stated the obvious, yet you’d be surprised at how many salespeople don’t have good communication skills, or don’t know what that term means (yet they think they do!).

First of all, communication isn’t just talking.  Communication is much more non-verbal than it is verbal.  It’s your body language and your facial expressions.  Communication is listening (remember the old adage, God gave you two ears and one mouth for a reason).  It’s your tone when speaking.  And, communication is what prevailing thoughts you have when you deliver a verbal/non-verbal message.  In other words, if you think the person you’re communicating with is a moron, then that will actually be transmitted in your communication to that person.  They’ll be able to feel your contempt.

Communication is everything that goes back and forth between two or more parties, whether it’s an email, face to face or phone conversation, presentation, or whatever.

If you see someone walking towards you on the sidewalk, there is communication going on.  Perhaps you two meet eyes.  Or, one, or both, of you purposely avoids eye contact.  Maybe one, or both, of you smiles.  Or, likely, you both look down and to the right or left.  Either of you might instinctively pull your coat over the front of your body, or bend your head downward.  Whatever you do, there is communication going on between the two of you, even if neither one of you says a word.

And, people are constantly judging and assessing your verbal and non-verbal signals, your communication style.  Instinctively you know this is true, because that’s exactly what you do with everyone else.  Now, I’m not looking to start a debate in your mind about whether or not you are judging people.  I know people don’t want to be known for that, however we all do it.  It’s a survival skill hardwired in our minds to let us know if we’re in danger, but that’s another article all together.  For now, just know that you unconsciously have reactions to the verbal and non-verbal cues that people give off.

That’s what’s tricky; the judging and assessing is subconcious.  I’m sure you’ve noticed that there are people you just don’t get, like, or feel right about…yet maybe you can’t put your finger on exactly why.  Many times those people won’t have actually said or done anything offensive, yet it could be the way they said something that caused your feelings.  That’s subconcious.

So, to be an effective communicator, you need to be aware of yourself and others.  You need to pay attention to how others walk and talk.  By walk, I mean how they carry themselves; their body language and facial expressions.  And you need to pay attention to yourself as well.

For example, it has been proven that gestures with one’s hands that go above the neck, more than a foot wider than either side of the body, or a foot out in front of the body are subconsciously threatening to other party.  So, if you want to shake a client’s hand, you need to either wait for them to offer their hand first, or keep your elbow closer to your hip when offering your hand.  Likewise, refrain from the high-five, unless the client puts their up hand first (I don’t know many agents in the habit of high-fiving your clients, but you get the point).

While I’m on the subject of using your hands, unsolicited touching is generally a no-no.  That includes pats on the shoulder, unsolicited hugs, touching of the arms or legs, etc.  Women can generally get away with touching more so than men.  However, if a women touches a husband while the wife is there, the husband might be okay with it, but the wife might not like it at all.  So, in general, you should probably refrain from the “it’ll all be okay, just sign the contract” reassuring forearm caress.

When dealing with verbal communication, the best thing you can do is be a good listener.  Which also means you need to ask good questions to illicit answers, so you have something to listen to.  Forget about getting all of your important information in one paragraph.  Don’t have your response on the tip of your tongue ready to blurt out as soon as you hear a pause in the other person’s speaking.  Don’t listen to the little voice inside your head that judges them or their answers, asks questions about if they like you, if they think you’re smart, etc.

Simply listen.  Listen, and really understand what they’re saying, and how from their point of view that’s the right thing for them to say at the time.  And when you respond, be sure to approve and/or repeat what they said, so they know they’ve been heard.

If you practice noticing and being aware of your and other people’s verbal and non-verbal cues and body language, as well as really listening to what people are saying, you will soon be known as a great communicator.  Your clients (and friends and family, by the way) will all appreciate how you’re so easy to talk to, and how you seem to “get” them.

If you want to study communication skills in relation to selling more homes, check out our website products page at www.yourethedifference.com to see our upcoming telecourses.  Also, You’re The Difference co-founder Christy Crouch and I have a couple of rare open spots for one on one coaching.  And we’re offering an economy busting price.  We usually charge $799 a month for four 30-minute calls a month.  However, we’re only going to charge the next couple of clients $499.  If you really want to take your business to the next level, learn and improve your skills, and be accountable to your success, give us a call to schedule your free, no-obligation 30-minute interview to see if you’re right for coaching.  Call 609-601-1296.

Who’s selling whom?

I’m not sure if I got the title grammatically correct, but the idea of this post is to find out if you, the professional salesperson, or your prospect/client is doing the selling on your incoming/outgoing calls, door knocks, open houses, showing and listing presentations, offer presentations and negotiations.

Prospects -

Do you find yourself answering a lot of questions and justifying your, or your company’s track record?

Do you find that your prospects are ending the conversation before you can set an appointment?

Are you content to let a listing prospect hang up when they say they’re going to wait for the market to get better, re-list with the same agent, or they already have an agent in mind?

Do you find yourself mostly talking to dial tones instead of finishing conversations with buyer call-ins, because they just wanted the price, are say they’re already working with another agent, rather than setting an appointment with you?

If you host open houses, do you run into people who don’t sign in, or ask you tons and tons of questions about the house, then tell you they’re already working with an agent.  Or when you call them to follow up, they don’t respond?

Appointments -Sellers

Do you find your listing presentation is mostly answering their questions and handling objections (usually about commission)?

Do you have a lot of listing appointments that end in “we want to think about it?”

Appointments – Buyers

Are you taking your buyers to what seems like virtually every house on the market in their price range?

Are you taking buyers to homes that are above the price range they originally told you they wanted?

Are your buyers making you take them to homes that don’t fit what they say they wanted…maybe just because they “want to rule it out”?

Are your buyers making very low ball offers?

If your market has it, are you afraid to ask your buyers to sign a Buyer Broker Agreement?

Do you work with buyers who haven’t yet gotten pre-qualified by a local lender?

Negotiations -

Do you let what other agents tell you about their clients and offers/counter offers affect how you present to your clients?

Do you let your client do exactly what they want, even though calling the other agent back in 30 seconds, not countering, or telling the other party to go pound sand might actually hurt the deal?

All these questions are a checklist, if you will, to size up who is doing the selling…you, or the other party.  If you answered “yes” to even a quarter of those questions, unfortunately, you’re the one being sold to.

3 basic tips on how to avoid being sold to -

1. Always, always, always ask questions.  Asking questions is tantamount to selling.  I would go so far as to say you could consider answering a question with a question.  Regardless, after validating what the other party asked or said, your default response in all interactions should be to ask another question.

Ask questions about what they’re looking to do, how soon they want to do it, why they want to do it.  Anything to find out their motivation and how you can best help them.

If you’re answering a lot of questions, and not asking a lot of them, the other party is in control of the conversation and selling you.

2. Know and believe in the stats.  I’m not saying you should spout of statistics every chance you get, however if a potential seller asks how you/your company is any different from their last agent,  it would be helpful to know that 70% of the listings on the market don’t sell, yet you sell 60% of yours.  Or, it might help to know that your listings sell 30 days faster, on average, than the average listing in the market…or for 3% more money than the average listing gets (list to sale price ratio).

Stats go a long way when, for example, a For Sale By Owner gives you an objection, and you know that no matter what they think, the actual empirical data shows they will a) most likely not sell their home and, b) get 15-27% less than if they sold with an agent…if they actually do sell.

3.  Get, read, learn, practice and memorize scripts and objection handlers.  Part of the reason the average agent only sells about 4 homes in a good market year is because so many get caught off guard.  They wing their prospecting and presentations, and don’t know what to say when someone has a question or objection.

If you haven’t already done so, get to our products page by clicking here so you can get Now What Do I Say?, our collection of over 425 objection handlers for nearly 75 different objections.  It’s in book and audio book form, and we also have a live role play CD to help you master objection handlers.

Just remember, you’re the professional salesperson.  Don’t be sold to.

Tips for Time Management

As I stated last post, time management is the single biggest challenge for real estate agents.  So, here are some tips for managing your time:

Go to bed same time every night on work nights – To manage your time, you need to establish a routine.  Most people who have a 9-5 type job know when they’re supposed to get up for work.  And, if they’re parents with kids, then they know what time they have to get up to get the kids off to school.  So, if you need a certain amount of sleep to be on your game the next day, start your “next” day by going to bed at a reasonable hour, and get into a routine of going to bed around the same time each night.

Get up the same time every morning – based on what I spoke about above, this would seem obvious.  However, you’d be surprised at the number of real estate agents who stay out/up late and sleep until they wake up.  Then they get into the office whenever.  To be able to manage your time at all, you need to be consistent with the start of your day.

Develop a morning routine - Hopefully, you’re starting to get the idea that time management is about creating habits and routines.  Most people have a morning routine already, it just may not serve them or be very powerful.  Waking up, showering, getting dressed, grabbing your coffee and running out the door isn’t a very powerful routine.  There are many things you can start your day with that will make your mindset unstoppable.  There’s exercise, reading/writing goals and affirmations, practicing scripts, objection handlers and presentations just to name a few.

Be at least 5 minutes early to everything – Have you ever had a flat tire?  Ever been in an unexpected traffic jam?  Ever forgot something at home, and had to turn around?  Have you ever got into your car and realized you’re below the “E” and desperately need gas in order to make it to where you’re going?  Did you ever try to run out the door to be somewhere and get a phone call that you needed to deal with?

The point is, no matter how much we plan and schedule, things happen that get in the way.  If we go around just giving ourselves the exact amount of time needed to get somewhere, we’re going to get burned pretty regularly.

And here’s the big problem:  we’ll have a nice excuse as to why we were late, when really we just didn’t plan ahead.  And, whatever we say (barring a real emergency) will be only an excuse in the mind of the person we tell it to.  Yeah, that’s kind of the unwritten, inside joke on ourselves that we forget about.  We think we’re fooling people with our good excuse about getting behind a school bus, but the seller who was expecting you 15 minutes ago is REALLY thinking, you should have left earlier, school buses always run around 3pm, and we’re really just not that important to you, are we?

Time orient your tasks - To-do lists can be very helpful.  The problem lies in letting the tasks dictate your schedule, rather than having your schedule dictate the time devoted to the tasks.  You need to set a time limit on your tasks, and be intentional about keeping to those times.  Human beings will always take the time allotted to complete tasks.  So, if you have 5 things to do today that might take you 90 minutes, you’ll find that you actually took most, if not all, of the day to get them done.

Phone calls come in, your thoughts drift, you see an email you want to respond to…all sorts of things come into play during your day that will distract you and take you off your list.

Conversely, if you give yourself time limits on either each task, or the list of tasks, you’ll find you get them done quicker.

Be time intentional when starting anything – Just generally be aware of the time you spend doing things.  They say time flies when you’re having fun.  Well, computers must be really fun because people spend hours upon hours on them and don’t seem to realize how much time has gone by.

Rather than just going through your day seeing what takes you where, look to be intentional about the time you spend doing anything.

Time your conversations – Another time killer is the phone call.  You pick up the phone and it’s your seller calling to check in.  Next thing you know it’s 45 minutes later and you’re agreeing to three open houses in the next month.

Set a time for your conversations so they don’t get away from you.  It’s very easy to set up in the beginning.  All you do is let whoever you’re speaking to know that you have a certain amount of time to talk.

Create a schedule – This is one of the hardest things to do for independent contractors (i.e. real estate agents), yet the most powerful thing you could ever do for your business (and your life).  If you take the above tips, you already have the makings of a schedule.  Then fill in your daily activities and you’re off and running.

Ask people to keep you on schedule – This is big because on your own you simply will not stay on your schedule.  The best way to make sure keep any commitment is to make sure you’re being held accountable to that commitment.  For example, if you secretly go on a diet, then no one will know that you’re cheating when you eat those cookies.  That doesn’t help you at all.

Have your spouse, family, colleagues, broker/manager, coach, friends all keep you on your schedule (this is really difficult because most of us don’t want to be on a schedule, and certainly don’t want anyone telling us to stay on our schedule.  Or, worse yet don’t want our bosses and spouses finding out we really don’t do that much all day!).

And, help people keep on your schedule.  Post your schedule in your home and work environments for all to see.  And tell people the times you have available to do things.  If it’s a client, you give them a choice of two available times rather than letting them tell you when they can meet.  If it’s a co-worker, tell them you can’t talk to them right now, but you’ll be available at 10:30.

And change your voice mail to reflect your schedule.  Tell people when you will return calls.  People love that and will respect that, as long as you actually do return the calls when you say you will.

You time – Don’t forget to schedule some time for yourself.  You will quickly burn out in this business if you’re “on” 24/7.  Get a massage, take a nature walk, go on a date (with your spouse if you’re married)…do fun things.  Heck, the easiest thing to do is take a legitimate lunch hour instead of eating lunch from the bag on the way back from the drive-thru.

Prepare the day or night before – Get your things in order before you have to attend to them.  Pick your clothes the night before.  Have the majority of the numbers you’re going to call, or doors you’re going to knock prepared the day before.  That way, you don’t waste valuable time when you come in and lose the momentum your morning routine will have created for you.  Nothing takes you off your game worse than coming in all fired up and realizing you have to get on the computer and find numbers to call or doors to knock.  If you go for expired’s and FSBO’s, consider a service like Leadsenders, TheRedX or Landvoice.  For something like $50 a month, they will pull all of the expired’s and FSBO’s of the day for you and provide you with numbers first thing in the morning.

Remember, the main thing is if you’re not on your schedule you’re on someone else’s, and that person doesn’t care about what’s going on in your life and business.

The single biggest problem/challenge for agents…

The single biggest problem/challenge for agents is, hands down, time management.

Let’s face it, most agents got into real estate because they didn’t want to be tied down to a 9 to 5.  They wanted freedom.  They wanted to be able to come and go as they please.

So, that’s why if you’re reading this in your office on any given workday, you’re likely surrounded by less than half the agents who work there.

That’s why some agents come in a couple of days a week.

That’s why some agents “work” from home.

That’s why some agents never get into the office before 10:30am.

That’s why some agents leave at 3-3:30pm (and I’m not talking about the one’s who have to pick up their children from school).

That’s why some agents take a three hour lunch at 11:30, after they just took a 45 minute coffee break at 10:30.

That’s why some agents come in at a decent hour and screw around on the computer for 2-3 hours before they actually start to not make calls or door knock for new business.

And, consequently…

That’s why many agents take any call at any time and run out to show people property to unqualified buyers.

That’s why many agents will sit all day at an open house, on a dead end road that people actually have to try to find, on a rainy Saturday.

That’s why many agents will go on an unqualified listing appointment at 7pm and come back without the listing.

That’s why the average number of homes sold a year per agent in the U. S. consistently hovers around four.

And, that quite possibly could be why you, the reader, may not have the listings, pendings, closings and money you really want.

Being able to manage your time is the single biggest key to your success.

The simplest way to manage your time is to create habits, routines and schedule.  Start to go to bed at the same time every night.  Get up at the same time every morning.

If creating a schedule is taboo for you at this point (we’ll work on that later), then create a to-do list.  However, the key to managing your to-do list is to make it “time” oriented, and NOT “task” oriented.

Time oriented means you assign time limits to the tasks at hand rather than just work on the task until it’s done.  I know it sounds like I just told you not to finish your tasks, however it’s been proven that human beings will stretch out their tasks to the time allotted.

For example, let’s say you have 5 real important tasks to do today, that if you really got down to it you could probably get done in 2.5 hours of consistent work.  If you don’t limit yourself to roughly 30 minutes per task, you’ll find that it will take all day to get the tasks done.  All sorts of things will happen to ensure you don’t get your work done in a timely manner, some of it will be self-imposed.

However, when you give yourself a time limit, you will work diligently to get the tasks done.

Does that mean you’ll get all your work done in the time alloted every time?  No.  But you’ll get much more done, much faster, when you work in time increments, than if you simply go about doing your tasks with no thoughts of time at all.

I’ll go into more detail on tips for time management in the next post.

How would you handle this?

An agent client of ours recently found themselves in this situation with their buyer:

Buyer is qualified to $390,000 and makes two offers on two different properties within a few days.

First offer on listing #1 is $350,000 on a $455,000 listing, hoping to get the seller to come down (listing agent encouraged all offers due to divorce situation, home’s been on for quite some time).

Seller #1 counters at $445,000.

Buyer then makes $360,000 offer on listing #2, which is listed at $395,000 and been on the market for about a week.  A little more than a full day goes by, more like 30 hours, and seller #2 counters at $385,000.

Your buyer tells you to call back right away, counter at $370,000, and says to tell the listing agent that they have an offer in on another property, all the while telling you they don’t want to lose this second listing.

What would you do?

I took an unscientific poll of about 10 agents.  All of them said they would call the listing agent and try to get the deal done quickly, expecting a counter of $375-$380K and doing their best to get the buyer up.

You could do that, and maybe get lucky.  The problem with that is there are two things at play here: 1. what to do in negotiations, in general, and 2. what to do in this particular negotiation based on the data you have.

As I recently stated in my Tips For Successful Negotiating blog posts, in general, the quicker one party call’s back the other party, the more leverage the other party has.  They will perceive the quick counter as attachment to the deal.  And, in this particular case, they would be totally correct.

You see, specifically to this agent’s situation, the buyer’s negotiation and motivation were totally at odds with each other.  The buyer stated he wanted the house badly, and wanted his agent to immediately counter back.  However, at the same time, the buyer wanted the counter to be $15,000 less than the seller’s counter, and also have his agent pump their chest about having an offer in on another property.

Think of the message the buyer is sending to the seller.  The immediate call back shows attachment.  The mentioning of the other offer is supposed to show the buyer is not attached, but actually would end up having the opposite effect.  The seller would undoubtedly think it’s a ploy.  You’re mentioning this other offer to either show me you’re not attached, or to get me to come down quickly so I don’t lose you…yet you’re the one who called me back immediately.

Now, let’s add in the fact that the last counter from the seller took almost a day and a half…and the buyer said he doesn’t want to lose this property (to other potential buyers).  So, if the seller counters again, or heck, even decides to accept at that price, it’ll likely take another day and a half before they call back.

Do you see how the buyer is mixed up?  He’s trying to play big-time negotiator but he’s extremely attached to the outcome.  It’s like he’s playing poker and doesn’t realize his opponents have seen his hole cards.

Now, I don’t advocate telling either party what to do, that’s not being a negotiator, that’s getting involved in the deal.  God forbid you tell a buyer/seller to do something and it blows up in their face, kiss the client goodbye.  Or, worse yet, your client takes your advice and then learns of someone who got a better deal in a similar situation in the near future.  At that point, you might be up for a lawsuit and/or loss of license.

However, in this case, it is pretty obvious that what the client wants, and what the client is saying are diametrically opposed to each other, so some guidance is warranted.  Even so, I’m wouldn’t tell the client what to do.  Start by asking questions.

“Mr. Buyer, I understand what you want me to do, and can I ask you a question?”

“Sure.”

“What’s more important to you, getting the house at $370,000 or getting the house?”

You’re answer will tell you what’s next.  Obviously, if they want the house at the price, then do what they told you to do.  You could suggest that you wait a couple hours before you call back with the counter.  You could also explain that mentioning the other offer will probably have an adverse affect, but it’s still up to them (the buyer).

However, if they answer that it’s more important for them to get the house, then you can explain all of your concerns and ask them to make their decision based on the concerns.

In this case, the buyer heard the agent’s concerns and upped their counter considerably, agreeing not to mention the first offer.  At the time of this posting, the buyer and seller had come to a verbal agreement.

The key was the agent was listening to the client, and heard their motivation.

If you want to practice what to say and how to say it, please visit our website at www.yourethedifference.com and look into our telecourses, coaching and the Role Play Connection, or call us at 609-601-1296.