If you are an experienced real estate professional (investor, realtor, etc.) you know all too well how important it is to keep a constant flow of deals coming your way in order to survive. That means meeting with property owners, one on one.
For those who are new to the real estate biz, it is important to learn early what works (and what doesn’t) when it comes to trying to influence the sellers you come in contact with. The truth is, many if not most homeowners do not really want to sell the home they have lived in for many years. But the fact that they must move is a situation that probably existed well before you found yourself at their door. Some need to downsize, or the move is job-related; others have experienced financial reverses, the death of the breadwinner, or they wish to retire and can’t afford their current monthly mortgage payment.
The way that previous real estate people conducted themselves (the reputation of those who came before you) can be problematic. For example, there’s a REASON that many used car dealers have a dicey reputation. They have justifiably earned all the negative press they’ve received as a result of previous inappropriate behavior.
The same can be said of at least a few bad actors in the real estate business, such as SOME real estate investors and a few unsavory real estate sales people. It does not take many bad apples to impugn the integrity of a whole barrel. You better believe that those with malintent and bad actions can poison the well for those who follow, for a long time.
So, how to make it better for yourself and your reputation? Start by differentiating yourself from the “other players” with the “black hats” and instead put on the semblance of the professional wearing a “white” hat and be as honest and forthright as you can. For example, draw comparisons between yourself and bad players out there by calling THEM out, and telling your homeowner client that you are not like them. YOU do things differently. YOU offer assurances, guarantees, integrity, a long and successful track record, a long list of positive references, etc.
Some cynics call this an “honesty pitch”, the implication being that it is somehow disingenuous to “tell it like it is” by being overtly transparent, as opposed to “what is it going to take for me to get this homeowner to let me list his house, and/or sell me his property fast and cheap”. Homeowners who need to move often find themselves in that position through no fault of their own. They did not ask to be laid off, or get injured on the job, get transferred to another state, get sick, etc. But the fact remains that they must move, and need your help to accomplish it successfully. THAT is why they are talking to you.
Here are nine things to consider as you venture forth to help those who need it
1. Be prepared to listen to whatever the homeowner has to say. Could be a few minutes, might be over an hour. By taking the time to hear them out, they will see you as an ally, someone who really wants to help. Once you achieve that magic breakthrough, positive outcomes often can and will flow after that.
2. Find out what they really NEED as opposed to what they say they WANT. Invariably there is always SOMETHING that they need more than anything else. It may be a faster (or slower) close of escrow, or a bigger earnest money deposit, a higher price, or? Your job is to essentially play detective and keep digging until you find out exactly what it IS that they want and need.
3. Don’t make promises you can’t keep. If you come up short on even a minor commitment, your credibility could very likely get trashed; and in terms of getting a listing or purchase contract after that, well good luck.
4. Have a common-sense set of options available for them to choose from. Avoid asking questions that require black and white, all or nothing answers. Instead try to offer a range of options for them to choose from. Not: do you want to do this or not? Instead: Would you like more money down or a higher selling price? Would you prefer escrow to close sooner or would a little later be better?
5. Minor point closing. Smart realtors and investors ask the homeowner a series of questions that can easily be answered with a yes. The end result should equal a listing or a purchase contract. This baby step process has to be carefully nurtured and cared for over the span of time with the homeowner. Move from minor point to minor point, getting tiny but significant commitments along the way. After a series of 27 “yeses”, it is unusual for them to suddenly spring a big “NO” on you.
6. Sell through the “No’s”. Amateurs see an objection from a homeowner as bad. Professionals recognize that a No is when the sales process can begin in earnest. Be prepared to work through a series of issues. Your job is to remove those problems and objections, one by one. Once all salient issues have been successfully dealt with, THAT is the time to start/resume minor point closing the homeowner in order to move towards end game (listing, purchase contract, etc.).
7. Remove any remaining problems that still exist. There may be issues with the condition of the house, the state of the homeowner’s marriage (divorce), the seller’s physical condition, etc. Each problem cries out for a solution. Until each of the issues is resolved, the documents you came with cannot be signed. Keep probing to discover what is causing the homeowner to not say yes (yet). Eventually, through a process of discovery, you will find out what is really at the core of the issue and you can deal with it once and for all.
8. Anticipate objections, as much as you can. Rehearse answers to standard questions. If you have done your homework, you can often get a head start on what is really on the homeowner’s mind. This information may come from public records, the MLS, through a friendly RESPA vendor, local service provider (gardener, pool guy) or neighbors. The more info you can garner in advance as to what the homeowner’s real problems are, the better prepared you will be to offer meaningful solutions.
9. Last but certainly not least, there is an old business saying: Control the deal or the deal will control you. By being friendly but assumptive, using minor point closing, finding out what the homeowner needs, listening to their complaints, etc., all of these things are positive indications that you are in control of the deal. Whenever you feel that control slipping, resume asking (minor point) questions until you have dealt with all their objections, and gotten to the core of the issue, thereby again reasserting control over the transaction. After that, a successful conclusion to your meeting should not be far off.
What We Do: Quickly provide short-term, first position, private capital funding, to real estate wholesalers, among others. Contact info: Tod Snodgrass, email@example.com, 310-408-7015