By Sammer Mudawar
Buying and selling residential real estate is one of the most emotional transactions consumers conduct. Understanding client psychology, managing expectations, and using effective communication are the three most valuable skills that a real estate professional needs to develop for a successful career with less stress.
Understand the psyche of your client and your chances of a smooth transaction increase dramatically.
Is the client a standard seller who has lived and raised their family in the home for the past 25 years, but has not done many upgrades? Perhaps prepping this client for the possibility of offensive offers from cash investors will be important to making sure they don’t take things personally, or worse, become unreasonable sellers.
Understanding client psychology is important, however, equally important is they understand your psychology. It is vital to the client relationship that they understand your goals are in-line with theirs, and as a fiduciary you will only represent their best interests. Breaking down the walls in the beginning is one of the best ways to get on the same page as your client.
Here are two examples of how to manage expectations with buyers and sellers. Continue reading »
By Dave Robison
My brokerage had one crazy month a few months ago. We had five buyers who failed to perform on a contract and lost their earnest money. Now in Utah, getting the buyer’s earnest money is supposed to be as easy as the buyer’s broker writing a check in about 24-48 hours. But in all five cases it was a fight, with hours of discussions and arguments. In the end, our sellers received their checks — although, in some of the cases the buyers and their agents were very bitter about turning the money over to the seller.
In the midst of the stress, there was one agent in particular who shined through. I believe this person will always be more successful than others (and he is, actually). His attitude reminds me of the attitude held by one of the most successful people I have ever met: Bill Child.
Bill Child sold his furniture store called RC Willey to Warren Buffett. Bill met with me and several friends and told us his story. I also read the book written about him: How to Build a Business Warren Buffett Would Buy. The great thing about Bill is that his attitude toward working with others never changed from the time he took over RC Willey to when he sold it.
Bill took over the business when his father-in-law died. He didn’t realize it at the time, but the company was laden with customer service problems, debt, and tax burdens. Bill turned all that around. For example, the company had sold an appliance that later became known to have a defect. There wasn’t a manufacturer warranty or guarantee on the product, but Bill wasn’t about to let his customers down. He took on the responsibility himself to do the repairs on all the units, even though he knew it would make his company go in the red. Most companies would just blame the manufacturer and keep their money in their pockets, but Bill’s customers were his No. 1 priority and he took the responsibility himself when legally he didn’t have to. He cared more about his relationships and his customers than he cared about profits.
Now, I don’t know the details about all the conversations the agents had with their clients regarding deadlines and earnest money, Continue reading »
By Jared James
As many of you know, I make my living as a speaker/trainer and have had the opportunity to speak to tens of thousands of REALTORS® and entrepreneurs over the last 12 months. My job is not just to communicate effectively, but to entertain and make the audience feel something. As Maya Angelo put it, “People will not remember what you do or say, but they will remember how you made them feel.”
About six months ago, I had the opportunity to keynote a large event in Texas, and it was one of those times when you feel completely connected with the audience and everything was going well. At the end of the event I had a younger guy come up to me and tell me how he loved my speech so much that he was ready to run through a brick wall. (Not a practice I recommend or condone.) He said that he loved everything I had to say, but there was just no business in his area. He said it didn’t matter what he did, there just weren’t any transactions.
I don’t usually have the time to do this, but on this day I did, so asked him to grab his computer and pull up for me every transaction that had happened over the last 30 days in his area according to his MLS. He did this and it turned out that there were 337 transactions! So much for NO transactions…
I looked him dead in the eye and I said that it seems that the problem was not a lack of transactions, the problem was that his name is not on those transactions! *friendly smile*
I am not mentioning this agent by name because he is not the point of the story. I bring up this point because I think this mindset is running rampant among many REALTORS® today. Continue reading »
By TG Gallaudet
Wait…I’m totally lying. Is there anything more painful? It’s no mystery that short sales can be really tough because of all the variables involved:
* Unclear timelines from the bank.
* Undisclosed liens.
* Back HOA expenses the bank won’t pay.
* Non-straightforward buyer.
* Inexperienced listing agent.
* Cash contributions (increasingly more and more).
* Etc., Etc., Etc…
But the hardest side to represent as an agent is the buyer’s side of a short sale because the buyer’s agent has no control of ANYTHING, and has to hope for a solid listing agent who knows what they’re doing. Right?
I just ended a painful short sale transaction where I represented the buyer that lasted 7 months and went nowhere. Granted, it wasn’t the easy one-loan in equator kinda deal, but we had absolutely no worthwhile answer from the bank after 7 months, which is totally inexcusable in 2011 as far as I’m concerned. The main problem, in my opinion, is that the listing agent saw this sale as a small income producer and pawned the negotiation responsibilities over to his part time TC. The TC had little-to-no experience with short sales, or negotiating any deals, and therefore little experience in working with banks. Because of her inexperience, I think she had little confidence in dealing with the bank and their personnel and couldn’t push back or demand results when she was entitled to do so. After being a listing agent on several short sales, I’ve come to understand that the burden of success lies heavily on the listing agent and specifically how s/he communicates to both the buyers’ agent and buyer, how she sets expectations and what answers she deems acceptable from the bank. Continue reading »
By Jared James
Spring is the time when more people will be making a decision about who to use as their REALTOR® than at any other time of the year. So is there a magic bullet to create more transactions in the next couple of months?? Watch the video below and you decide. I look forward to your feedback and connecting with so many of you. Good luck!!
Jared James is the CEO and founder of Jared James Enterprises (JJE) and travels around North America speaking to and coaching REALTORS®. Connect with Jared at www.jaredjamestoday.com, on facebook.com/jaredjamestoday, or follow him on Twitter @jaredjamestoday.
By Chris Nichols
Assumptions — we all make them. But have you ever stopped and thought about the dangers involved in making even just simple assumptions?
Wikipedia states, “In logic an assumption is a proposition that is taken for granted, as if it were true based upon presupposition without preponderance of the facts.”
Have you ever assumed what the needs of a client were without asking them specifically? This generally results in expectations missed, whether it be a buyer seeing houses he or she doesn’t really want, or a seller who is more concerned about selling quickly versus getting top dollar. These are all assumptions that can be costly to our pocketbooks as missed closed transactions and frustrated clients.
There’s also another type of assumption that can be costly: Oftentimes, in the middle of a transaction, we make assumptions about the REALTOR(R) on the other side of the transaction. Or perhaps about their client.
It is so easy to fall into this trap and allow our unfounded or preconceived notions dictate how we handle negotiations. I recently had this very thing happen to me as a seller allowed their assumptions cloud their judgement of my buyer due to an FHA appraisal coming in short of value. Unfortunately, the seller’s REALTOR(R) could not change their client’s presupposition that this was a ploy on the buyer’s part.
The last assumption I want to touch on is the assumption we sometimes make about leaders in our association. I can speak from firsthand experience as the president of a local association that I have learned much in the two plus years leading up to taking this office. I can remember the many misconceptions I had about all three levels of our association. But as I’ve taken the time to learn, to ask questions, and to get involved, it has been easy to replace incorrect assumptions with actual facts and understanding. Continue reading »
By Toby Boyce
The couple slid through the front door, their faces painted with obvious pain and anguish over having to go through this all over again – and after talking to them, it became very obvious why.
This was the first time I’d met the couple, but I was far from their first real estate agent who they’d viewed houses with. A past client referred them my direction and as we stood in that house, it became obvious that the agents they’d met were not paying attention to the clients.
While I’m sure that no one that reads the YPN blogs is guilty of this at all, it seemed a good time to remind other professionals of a few items.
You Work for the Buyer (or Seller). This is an amazing concept, I know. While many clients will lean on your expertise the key is to remember that every – and I do mean EVERY – decision in this transaction is theirs. Stop putting your values, ideas, and personal biases on to your customers – they don’t care and more importantly it could be a lawsuit waiting to happen if it is deemed to be steering due to a protected class.
Lead the Horse To Water, Let It Drink. The neighborhood isn’t the best one in the market – but which is the best? Is that a subject or objective statement? Of course it is subjective which means it needs to be left up to your clients. Showing houses last weekend and the street felt very busy to me and the buyers have a young child – made me uncomfortable. Did I voice my concern to the buyer? Of course, but it was in a constructive way, suggesting they come by the house a few times to make sure they were comfortable with the traffic and speed on the street. Led them to the water hole, and to drink or not was their decision. Oh yeah, and they wrote on the house.
Show Some Personality. I’m unique; actually I believe when I was in school the word was “special.” And I’m proud of that. You should be to. Embrace who you are and utilize it to the best of your abilities. I’m a natural educator and I believe that my home buyers are some of the most educated about the process in the area. I work with people who share similar beliefs from an affiliate stand point and it has worked for me during my four-and-a-half years in real estate. Continue reading »
By Jonathan Osman
Step 1: Find a buyer. In my market, the unemployment rate is 11.1 percent and the under-employment rate is around 16-20 percent. While a few years ago, one could conceivably purchase a house without a job; today, employment is essential.
Step 2: Find the buyer a loan. As long as the buyer has a job, modest credit scores, and reasonable debt load, this can be accomplished with relative ease. However, only 75 percent of buyers ever make it past Step 2.
Step 3: Find the house. SO VERY EASY especially with only 24,000 homes in the market to choose from; 5 percent being REO, and the buyer wants “a deal.” The buyer then proceeds to view all 24,000 homes, making offers at fifty cents on the dollar, with only a $10 earnest money check.
Step 4: Under contract: Oh yeah baby. I can count the dollars now. Just sit back and wait for the closing day. If that were only so true…
Once the home is under contract, now there stands a nearly insurmountable set of obstacles that will kill any transaction such as (All of the following actually happened at some point in the last 3 years):
- Did the inspection reveal needed repairs? Yes. Will the seller repair? No! Deal dead.
- Does the inspector freak the buyer out over unnecessary repairs? Yes! Deal dead.
- Does the house have mold? Yes every house has mold? Buyer freaked? Yes! Muerto.
- Did the house burn down before closing? Yes! Does the buyer still want it? No! Done. Continue reading »
By Jonathan Osman
If you ever want to start a heated discussion among agents in my area, ask them their opinion of short sales. What will pour forth is the most draw-dropping tales of sheer lunacy; always ending with “I’ll never show or sell another short sale again.”
This presents a problem for me on a number of levels. First, to my own self interests, I list and sell short sale listings. While most of the agents I have interacted have not done business with my group, they are hesitant to jump back into one of these transactions with anyone…and I totally get that. Out of the four short sale contracts written by my buyer agents on other listings, only one closed. Today in the Charlotte area, we have more than a 13 month supply of short sale listings and only a 3 month supply of REOs. That may not say much until you learn that the actual inventory numbers for the REOs are slightly higher than the short sales; the results of those bad experiences.
Beyond my own interests is the interest of a home owner facing foreclosure. Due to any number of hardships, they now face the difficult prospect of losing their home, a future deficiency judgment, and possible bankruptcy if things don’t work out this time. Along with that home owner is a neighborhood with values that drop with every foreclosure, pushing another home owner to a short sale, strategic default, or walk-away. The most profound statistic I compiled through data in our local MLS and through the state was that last year, more home owners lost their home to foreclosure in my county (the largest in North Carolina) than agents closed homes through the MLS. Continue reading »