Tip #1 - Conduct a Consultation - For some reason, I have observed over my career - going back to 1991...most real estate agents have always approached working with buyers differently than with a seller. With a seller, we make an appointment, go out to meet the seller at their home and have a meeting - or - we refer to this as a listing presentation. However, (and I say for whatever reason) our industry as a whole doesn’t approach the buyer lead the same way. Why is that? Is it just a matter of watching what others have done and doing the same as what everyone else has seen people do? It reminds me of the story…
A young girl was watching her mother bake a ham for a family gathering and noticed her mom cutting off the ends before placing it in the oven.
“Mom, why do you cut the ends off before baking the ham?” she asked. “Hmmm…I think it helps soak up the juices while it’s baking. I’m actually not sure, though. That’s just the way your grandma always did it, so I’ve just always cut them off. Why don’t you call grandma and ask her?”
So, the little girl phoned her grandma and asked “Grandma, mom is making a ham and cut off the ends before placing it in the oven. She said that it’s probably to help soak up the juices but wasn’t sure. She said you’d know because she learned how to cook from you.”
“That’s true. I do cut off the ends of the ham before baking. But I’m actually not sure why either. I learned how to cook from my mom. You should ask her.”
So, the inquisitive little girl called her great-grandmother and asked “Great grandma, mom, and grandma said they learned how to cook a ham from watching you. Do you cut off the ends of the ham to help it soak up the juices?”
The great grandmother chuckled. “Oh, no sweetie. I just never had a pan big enough to hold a whole ham, so I always had to cut off the ends to make it fit.”
The story of the ham is not new, and has been told numerous different ways, but it is a great example of the critical thinking errors we make every day. When we do things “because that’s what we’ve always done” we fail to seek opportunities for improvement. We fail to see the assumptions we make every day out of habit and routine. When we just keep cutting off the ends of the ham, we fail to innovate.
“No problem can be solved from the same level of consciousness that created it.” - Albert Einstein
All that to say, just because that is what may be “common” is it the most effective? I understood and did this myself in the earlier days of my career. Since then, I have learned that (for me and I found to help me be successful) was to treat the first step with the buyer, no different from the seller. Have a consultation, get face to face and see what’s really going on. When you do this, it sets up the rest of the process to go forward with fewer issues and a more fluid manner.
At the consultation be sure to do the following:
Present you plan of action - (POA) for the buyer. This is the equivalent of a listing presentation for the seller. What are the steps you will take as you represent the buyer? This builds value and emphasizes your professionalism. Use a questionnaire Have a well thought out “questionnaire” that you can use to perform an in-depth needs analysis. When you “wing it” you risk missing important details that can come back to haunt you later. Get commitment - Are you willing to work for free? I don’t think that is your plan, and yet it happens all the time. People go forward working with a buyer and everyone “feels” good about everything….until...they find a home and opportunity they can’t pass up with another agent. - It’s an extreme example and yet effective. Would you get married to someone who says “ok you can marry me, however, I don’t have to be married to you”? Of course not! My experience and suggestion here is it’s just fair - it’s an exchange of commitments - your time and expertise to the buyer - and your buyer showing loyalty to you for your time and expertise. It’s call fair and reasonable! When you demonstrate value, show the benefits the buyer receives, they will sign a buyer rep agreement with you just as a seller that sees the same value and signs your listing agreement. Establish time lines and set expectations - The big takeaway from this step is to be EXPLICITLY clear on when the buyer will be ready to get the keys to their new home? It’s not enough to have an “idea”. We have to know for sure. Also, know WHY this is important to the buyer? What happens if that date is missed? Exhaustively find out what the motivation is. Once you find out the timelines, you can then determine if you move forward, slow down or wait till a later date. Next, you can use the “formula” to determine what to do next, and this allows the buyer to clearly understand what has to happen to meet their goals.
Tip #2 - Use The Formula - This is something I came up with awhile back. It’s something I figured out as a result of being in that difficult and very precarious situation when you have a buyer that wants to buy a home, it’s just not for say several months down the road. You don’t want to lose the lead, and you also don’t want to waste time showing homes and know the buyer isn’t in a position to perform. What do you do? I can tell you what most agents are doing, they getting caught in this trap of showing homes reluctantly and against your better judgment. This is always frustrating! I was in this situation so much I finally came up with the “formula” here is how it works. By the way, it won’t work 100% of the time; nothing works 100% of the time, however, done consistently; it will work in your favor over time.
Establish a timeline - How many days there are from today, until they are ready to move in. Let’s say for this example it’s 75 days or 10 weeks. Sounds like a lot of time right? Ask the buyer “are you aware of how many days on average it takes to close a sale once you find your home of choice?” (Doesn’t matter what they say) Typically, you will hear 30 or 45 days. Regardless, we confirm or agree and use 45 days as an example. Take (in this case) 75 days and subtract 45 days for the closing period. This leaves us 30 days to identify and get a contract on a home. All of a sudden, the buyer’s mindset changes as they don’t have 75 days anymore, they have 30. This brings some perspective and creates urgency. Next, we explain “ok, so we have 30 days to find your new home and get a successful contract in place” Unless you let me know otherwise, that is the timeline I am working towards to make happen for you. A CLEARLY DEFINED OBJECTIVE! How many buyers would you like to have ready to buy a home in 30 days? Same example - in this case, buyer ready to move in 60 days...less 45 to close, all of a sudden we have two weeks! If your buyer begins to lose focus or enthusiasm, you can remind them (tactfully) about the time frames to help keep things on track.Let’s look at the opposite scenario, the buyer says they want to look at homes and aren’t able to buy for five months. What do you do then?
Establish how many days there are from today, until they are ready to move in. Let’s say for this example it’s 150 days or 5 months. Ask the buyer “are you aware of how many days on average it takes to close on a sale once you find your home of choice?” (Doesn’t matter what they say) Typically, you will hear 30 or 45 days. Regardless, we confirm or agree and use 45 days as an example. Take (in this case) 150 days and subtract 45 days for the closing period. This leaves us 105 days to identify and get a contract on a home. We can have the following conversation with the buyer. “I want to help you...you have a few options...if we find your “perfect” home, we’d have to find a seller willing to wait 100 days to close, and 60 days is considered to be a longer than the typical time frame. Also, you will usually not be able to negotiate favorable terms since the offer isn’t as attractive to the seller. It also can bring up some challenges for your financing, locking in and fluctuation in rates. (seller market - will be looked over in multiple offers) So, you have a few choices… You can wait until you get a bit closer to your timeframe and start the buying process then. OR If you can, move up the date to close the gap and be within the typical closing time period.It’s up to you...what would you prefer? (either way, it works to your favor)
With some practice, you can learn how to deliver this in a sincere manner. It is what it is - having a conversation like this has helped me numerous times work through these two situations that are bound to come up often when working with buyers. The key is really making it about them and showing your support for their circumstances, not that you aren’t interested in showing them homes.
Tip #3 - Showing Property Best Practices
Show them how the food is cooked in the kitchen:
Pull all properties that match your buyer’s criteria. Tell them how many you found. Explain to them how many you ruled out due to location (train track, traffic street, etc.) or didn’t meet condition expectations, significantly overpriced, etc. This leaves the net total of possible matches. Remove doubt - Doing this helps the buyer realize that what you’ve presented is the entire market available to them at this moment, based on their criteria. Also, this removes that “what if there is something we haven’t seen yet” thought process. We have to let our buyer into the research process and allow them to be a part of what you have done to prepare for them. Usually, we just present them homes - it’s like putting a plate in front of someone and saying “eat” and not asking if they are even hungry.Get your buyer used to hearing “would you like to make an offer on this home” - The idea here is that we don’t want this to sound foreign to the buyers we work with. We also don’t want to come across obnoxious; there is a balance here. When you ask this question, you get to learn what is going on in your client’s mind. Open dialogue allows you to be on the same page and encourage the process forward based on that feedback. When we don’t talk, we don’t know what is taking place and end up dragging out the process.
Play the Beat It game with your buyers - This is a fun way to help you and your buyer rule in or out homes and keep focused. Here’s how it works. You show a home, on your way out the door, ask them to rate the home on a 1-10 scale, 10 the highest. Let’s say they rate it a 6. (as a side note, two great follow up questions are 1. Ask them “what was it about the home that makes it a 6 in your mind? 2nd - What would have to happen to make it a 10? This tells you how they are evaluating their decision-making process.) You go to the next home on your route and again, on the way out the door, ask how does this one rate on a 1-10 scale? They say an 8, then this means this one “beat” the last one. This home is in 1st place, forget about that last home, let’s see if we can “beat it”. You go on to house #3, ask the same question … they rate it a 7...so you say...that means house #2 is still the one to beat, let’s forget this one and so on. As an example, if you were to show 5 or 6 homes that day, you all know which one is the home in 1st place. This sets up a simple way to ask at the end of the tour the following “well, of the six homes we saw today, home #2 was your favorite home...would you like to make an offer and see what we can do on that one?” My experience is agents just show and show and show some more homes and never make an attempt to get the buyer to make a buying decision. Lastly, if we don’t do this then all the homes begin to blur together, and the buyers can easily get overwhelmed and shut down.
