Most of the complaints I hear from real estate agents is the frustration of working with buyers who turn out to be dawdling, postponing, hesitating, wavering……you get the picture. Don’t they know this is a buyers’ market? Oddly enough during a sellers’ market buyers will go to any lengths to buy a house making it one of the most difficult times to buy value. Buyers were buying like crazy even though the advantage was all to the seller. Now when it’s a true buyers’ market, they want to wait for fear of paying too much. Gary Keller in his book Shift says, “When they should have been afraid of paying too much they weren’t and now that they shouldn’t be afraid of paying too much they are.” It seems they are intent on finding the greatest deal ever and it causes them to miss out on the great deals that are possible. Most believe that they can “time” the market thinking they have all the time in the world. It isn’t possible to know when the real estate market has “bottomed” since it is a relative position and you only know you were at the bottom when it starts up again. Guaranteeing a “killing” on both ends is impossible, as any investor will tell you real estate is a long-term investment. What goes up comes down and what is down will come up again.

After the typical advice that buyers need to be ready, willing and able, Keller offers some excellent direction on energizing buyer urgency…

photo credit: visitmyluxuryhome.com

Three Ways to Energize Buyer Urgency

1.  Become the local economist of choice: Consumers seek expert advice on everything from health care to car problems but take their real estate advice from newspapers, neighbors and relatives. Those sources can’t possibly give you the whole story on local real estate. Keller suggests that you start by influencing their rational thinking with solid numbers and facts. People have been lead to believe that they can buy or sell every three to five years and make a killing on both ends. As the local expert you can help buyers to understand realistic economic expectations in their local market. Since market expectations can be a powerful source of motivation, you should be the one setting those expectations. You need to know as much as possible about the local market.

2.  Tap into their “WHY”: You’ve heard it before, “when they say what they want, you ask why?” Don’t let this powerful determining and motivating factor go unnoticed. Leading reluctant buyers back to their “why” is not manipulation, it is part of your fiduciary duty to remind them of what they want to buy and why. Of course, in the end your buyers make their own decisions but it is you who helped them overcome their fears and make a good decision.

3.  Overcome Buyers Reluctance: Once the market starts showing signs of improvement the really great buys slip away and the pent up demand for housing drives prices up through mounting competition. Buyers’ markets are skill-based markets and now is the time to practice your talking points (scripts), find a business coach, engage in interactive role playing all in order to help buyers make good decisions. You can do all that with the strategies that Keller describes in his book; hazards of timing the market, trade up (the opportunity of a down market), narrowing a buyer’s choices and finding a “Best Buy”.

Keller says you can cope with this market shift by: building buyer urgency through “expert knowledge of the market, careful consultation on their personal wants and needs, skill at communicating the opportunities of the market, and assertiveness in challenging their thinking. As the dedicated professional that you are you have earned the right to help people with their real estate decisions as well as the “courage to act on what you know to be true.”

DF

<previous article in series – final article in series>

It wasn’t all that long ago that a house would sell regardless of how it looked, smelled or presented itself – well, WAKE UP, times have changed and so have buyers.  Savvy agents recognize that a shift means its showtime for a listing.  Your listing must win a beauty contest and a price war!

As an agent you face two obstacles; the seller’s reluctance to invest in staging and the buyer’s inability to envision how a property will look when it is in its best condition.  Generally speaking, staging is an essential part of marketing a home.  Keller tells you the numbers are on your side, “a review of over 2,800 properties in eight cities found that staged homes, on average, sold in half the time that non-staged homes did.  The sellers with staged homes ended up with 6.3 percent more than their asking price, on average.”

Sellers, while they grasp the benefits of staging, may not see the necessity of staging their home.  They have spent money, time and effort in fixing and filling it with their stuff and it bears their personal taste.  But now, the house needs to appeal to the broadest possible segment of likely buyers.  And, you need to convince the seller that you don’t live in a house the same way you put a house up for sale.

Gary Keller in his book Shift suggests that you might want to use the “3P-2F Formula” in suggesting improvements:

♦  Plantings

♦  Paint

♦  Pictures

♦  Furnishings

♦  Fixtures

The house’s appeal has to start at the curb, if they don’t like the outside, they may never see the inside.  And, buyers spend a lot of time on the front porch while the agent is accessing the key.  Keller advises taking sellers through the house room by room asking them in each area what three things they would do to improve the appeal for that particular area.  The following areas are especially important to buyers:

♦  Entryway

♦  Kitchen

♦  Master bedroom and bath

♦  Main living areas

♦  Other bedrooms

♦  Backyard

In the event that sellers cannot name three things they need to do to improve those areas, you need to be ready with a list to help them out.

Be sure to suggest a thorough cleaning, windows especially need to sparkle.  You may need to address clutter; clutter eats equity because clutter eats space.  You certainly don’t have to be the one that does any of this, if you want to that’s great, but there are professional stagers you can use as another option.  Some agents provide one or two hours of a staging consultation as a part of their listing package.  There are advantages to having a third-party professional deliver the bad news especially when you are talking about their precious personal photos or knick-knacks.  Remember that the entire idea of staging is to create a neutral environment where buyers can envision their own things.

There are already so many thing you can’t change about a home; its location, square footage and amenities that staging becomes imperative to accentuate the true value of a home and when done effectively can actually create value.  Keller says, “Pricing and staging are the issues of the day in a shift…..pricing gets you in the game – staging gets you the offer.”

DF

<previous article in series – next article in series>