Tuesday, May 4, 2010

USING SIMPLE LOGIC

Nuggets For The Noggin
USING SIMPLE LOGIC
Article By Jim “Gymbeaux” Brown, April 30, 2010


What does it take to list and successfully sell a home?
  • Competitive Sales Price: A sales price that is not only competitive with other comparable properties but probably slightly less. If there are more sellers (inventory of available homes), the price may have to be a lot less than what otherwise would be considered competitive. It is a simple case of supply-and-demand. The fewer the buyers the longer it typically takes to sell therefore a homeowner must make their property stand out from the crowd. When there are more buyers than houses (such as immediately following Hurricane Katrina), all bets are off in regards to pricing. But in a “buyer’s market” the correct pricing is critical!
  • Condition: The condition of the property being sold must be reflected in the asking price. If a property requires a lot of work as compared to other similar properties that do not require similar work, the price must reflect that. A great practice would be to encourage the homeowner to obtain a professionally prepared home inspection as the property is being put on the market. The seller can then price the property accordingly and/or make the repairs necessary plus use the home inspection as a marketing tool demonstrating to buyer exactly what they are purchasing. Purchaser may still obtain a different home inspection if they wish to.
  • Seller Motivation: “We’ll just put it on the market to see what happens.” That is not motivation to sell. A seller who is motivated to sell will insure that not only will the price be competitive and the condition match the price, the seller will do whatever is necessary to sell the property. Seller motivation is a huge factor in selling real estate. An unmotivated or unrealistic seller will almost always result in a long sales period if there is a sale at all.
  • Professional Yard Sign: This is HUGE! Yard signs represent a significant number of all sales that are made. A professional yard sign as compared to a For Sale By Owner sign clearly demonstrates to potential buyers that the sellers are represented by a professional, that would be you. On the contrary a For Sale By Owner sign that signifies the seller probably does not have professional real estate experience or knowledge and therefore may be subject to being taken advantage of.
  • Home Warranty: Would you buy a car without a warranty? Most say no but then list their home that is significantly more valuable than their car without offering the buyer a home warranty. Everything may work perfectly on the day of the act of sale and moments later fail. Who would ever believe that the sellers and the seller’s agent did not know that something was about to fail or didn’t work properly in the first place. Who does the buyer call? The sellers and the agents involved in the sale both listing and selling. Who would you prefer the buyer call? A Home Warranty representative! Offering a Home Warranty is the right thing to do.
  • Multiple Listing Service: The use of a professional yard sign and placing the property in the Multiple Listing Service (MLS) accounts for most sales. Period!
  • Great Real Estate Agent: This is more important than most real estate agents are aware of. Who wants to work with a jerk? I don’t, do you? Therefore everything you say and do when in relationship while working with other real estate agents throughout the area as well as those in your own office is absolutely critical. If a seller lists a home with a real estate agent who is known to be “hard to work with”, “unethical”, and/or “non-existent”, they should expect that their property will be very difficult to sell. For example, a buyer’s agent finds 15 homes that meet the customer’s needs. Only 5 to 7 homes are going to be shown and remember they all meet the customer’s needs. Which 7 or 8 homes are going to be EXCLUDED? I can guarantee you that one or more will be listed by agents who could be hard to work with so with that in mind why would you want to show their properties when others are available? This is not rocket science. Unfortunately most sellers are unaware of the reputation of the agent they select in comparison to other agents in the area. How do you promote your reputation? Through the use of testimonials both letter format and video format. Nothing speaks more highly of you than satisfied customers as well as recommendations from people within the business like loan officers, closing attorneys, etc. Most agents, certainly not you, never ask for referrals in writing from their satisfied customers or people “in the business.”

Obviously there are other factors that go into a successful sale but these are by far the most important factors. What happens when a seller indicates that they do not want a yard sign in their yard or one of the other essential elements of a sale? Before you can answer that you need to know what the seller believes in regards to the use of a yard sign. Experience has shown that some homeowners do not want their neighbor to know their home is on the market. Not sure why; you need to delve deeper into their reasons. If the reasons are legitimate by all means honor their desires. However most reasons are superficial and really are not warranted.

What do you do or say to convince the homeowners they need to rethink their position? It is important that you not only provide the logic but you also allow them to come to the logical conclusion.

“Mr. & Mrs. Seller, I understand your concern. When we (the “we” is important because you and the sellers literally form a team and it sounds as if they have already listed the home with you) put your home on the market we are literally going to war. By that I mean look at the number of homes we are in competition with. (Show them the list.) In addition to those homes there are the few For Sale By Owner and bank owned homes as well. Everyone wants THEIR home to sell so they typically give their agent all the tools (bullets) necessary to market the home. The most important of these tools (bullets) are; (1) competitive sales price, (2) price that reflects the condition of the home, (3) your motivation to sell, (4) use of a professional yard sign, (5) home warranty, (6) use of the Multiple Listing Service, and (7) a great agent like me. 7 tools. Let’s assume that every agent representing the owners of every other home on the market have all 7 tools working for them. (You can have a bit of fun and suggest that unless they have hired you, the other homeowners will never have all 7 and do it with a definite smile on your face). You have indicated that you do not want a yard sign (or a home warranty or a non-competitive price, etc). You are asking me to go to battle for you without all the tools (ammunition) available. Do you see where we, you and I, are starting out in the hole before we begin?” (Wait for their answer, say nothing before they do, let them answer first. There is no way they cannot agree with you. When they agree they usually permit you to do what is necessary to do the right thing.)

ACTION STEP: Prepare & Practice! If you wait until an objection is voiced and then develop your response, you are doomed to fail. You know such objections are going to come, be prepared for them. Identify potential objections or concerns and then develop a logical response. No trickery, just logic. Help the customer to come to the same conclusion that you have reached by providing them with the information necessary to do so.