Top Tips from the 2010 CRS Sell-A-Bration

 

1. Realtors are in the moving business. They move clients from denial to reality.
2. Don't be a 'listing pig' & take every listing.
3. Price sells property. Marketing builds brands.
4. A buyers #1 concern is overpaying for the property.
5. Listing agreement clause for the seller to initial: Seller agress to reduce the price every 30 days until sold.
6. Use open ended questions, ie. "Who is your agent?" vs. "Do you have an agent?"
7. Determine migratory patterns for your area from www.realtor.org
8. No longer is the first showing of a home in the home; it's online.
9. DISC profile memory helper: D(power people), I(party people), S(pleaser people), C(perfect people).
10. Email consumer videos, ie. pricing, staging, etc. (www.realestateconsumervideos.com)
11. Legal tip: A short sale lawsuit can be won or lost due to an accurate phone log (CYA).
12. Script for short sale referrals: "Do you know anyone else in this situation?"
13. Add a short sale info button to yout website.
14. Read The Seven Levels of Communication: Go From Realtionships to Referrals (www.71book.com). The first chapter is free!
15. Pricing script: "Cost does not create value."
16. The upward spiral of life is: Learn, Implement, Fail, Evaluate.
17. You cannot retire on income. Only an asset base. What are you doing to build that base?
18. If you roll on IRA into a 401(k), you can then borrow from it.
19. Offer fsbo's and expired's help on the buying side.
20. Blessed are the flexible for they shall not be bent out of shape.

Wow, look at those diamonds!

 

Paul Simon wrote a song a few years ago that spoke of a woman who had, “Diamonds on the soles of her shoes”. On Super Bowl Sunday I was introduced to a woman who had the largest collection of big stones I had ever seen. My first reaction was, “Holy crap, are those things real”?

 

She had a diamond pendant that was the size of a small bird’s egg. I was amazed that her diamond earrings didn’t distort the shape of her lobes. The stones appeared to be the size of large blueberries. Her diamond ring looked like she could have borrowed it from Liz Taylor. And, the tennis bracelet had gems that children could use in a game of marbles.

 

My first reaction was it’s too bad such a pretty lady had to rely on her jewelry to make her feel beautiful.

Big stones, big boobs, big hair, in my opinion can hide some big wounds.

 

Earlier that day I paid one dollar for a rubber bracelet that I put on my wrist. It says, 32B – worship, grow, serve. It’s the theme of a set of sermons from Cornerstone church in Chandler, Arizona. When I first heard that theme I was mesmerized by its simplicity, sincerity, and significance.

 

At that same Super Bowl party I met a single mom who grew up on a farm in Nebraska. She was pretty, personable, and fashionably dressed. But, she eschewed the heavy jewelry. Guess which girl I asked to play billiards? Guess which girl I plan to ask to a dance this week?

 

When Stephen Covey said you should place the ‘big rocks’ in the jar first as you plan and prioritize your life; I don’t believe he was speaking about gem stones. Christianity was built on a rock, but it wasn’t a sapphire or a ruby.

 

Personally, I’m more impressed with a yellow ‘Live Strong’ rubber bracelet than a diamond tennis bracelet. I’m impressed with a woman wearing a pink breast cancer ribbon who raise money and ran in the Susan B. Koman race. To me, planting an aspen tree is more impressive that owning a ski chalet in Aspen.

 

Tis’ the Season to Cancel Listings

 

The ‘Godfather’ close

 

What’s your favorite close on a listing appointment? I’m not talking about a ‘come list me’ from Uncle Guido. I’m talking about a seller who is interviewing 5 agents and you’re not the last agent giving a presentation. In my opinion, few closes are better than the “Godfather’ close.

 

Let’s set the stage. You’ve given a listing presentation to the seller who you determine is ‘serious about selling’. They are prepared to be realistic on pricing, and the house shows great and needs no further staging. You want this listing and have reminded the seller you are ready, willing, and able to proceed with a few signatures.

 

The seller replies that they believe you can get the job done. They are impressed with your professionalism, red power tie, and cologne that reminds them of their favorite aerobic instructor. But, they promised several other agents an interview and “Their word is their bond”. Now what do you do? It’s time to introduce them to your ‘Godfather’ close.

 

The sellers are smiling and leaning forward in their kitchen chairs. You begin to smile and lean forward also. The sellers speak slowly and deliberately. You speak slowly and deliberately because of your neurolinguistic training class that says matching and mirroring enhances receptivity. Now the ‘Godfather’ close begins.

 

“M/M Seller, if I were to make you an offer you couldn’t refuse; would you list your property with me right now”? The sellers look at each other amazed because they said they wanted an assertive agent this time, and this feels assertive to them. Of course, they ask, “What’s the offer”?

 

You repeat the ‘if – then’ proposition to make sure they are interested. They reply out of intense curiosity, “Yes, with the right offer we’ll sign now, and cancel the other appointments. What’s the deal?”

 

You could play ‘let’s make a deal’, but you don’t. You simply say, “M/M Seller, you tell me. What would I need to do, or promise to obtain your commitment right now”?They look in each other’s eyes and say, “All the other agents wanted a one year listing and that’s too long. Would you take a listing for 120 days”? You are tempted to wipe the saliva from the corner of your mouth, and you do.

 

The Godfather in you now says, “If I would take the listing for 120 days, will you list with me right now?” The seller replies, “Yes”. You consummate the paperwork, as you and the Godfather smile and live happily ever after.

 

 
The top three factors in finding a home are location, location, location. One of the top three attributes of a great salesperson is persistence, persistence, persistence. You can call it follow-up, dogged determination, or stick-to-it-ness. Winston Churchill summed it up best when he said, “Never give up”.
 
A few months ago I went on line to receive a one week trial pass to a local, upscale fitness facility called Lifetime fitness. I visited the club, received a tour and trial pass, and even tried a cycle class. Nobody from the club called to say, “Are you ready to join?” And, consequently, I never did.
 
One of my real estate ‘secret weapons’ is having a past client follow-up each and every appointment. She calls to confirm the appointment. Then after the meeting she calls again to do a follow-up and see if any questions may have arisen.
Since she was a past client and raving fan she gives a glowing testimonial. In addition, each prospective client receives a thank you card.
 
Years ago I attended a class and a story was told about one of the members in that room. In 1982 his GCI was over 250k. He didn’t work evenings or weekends and his main source of business was FSBO’s. The secret of his success was persistence. If he felt the seller was ‘serious about selling’ he visited them in person, and then called every three days. He committed to five follow-up calls.
 
On one visit he handed a FSBO his card at their door. The seller looked at it and ripped it up then closed the door. What would you do in that situation? Most agents would quit. A few daring souls would go to the back door and report the angry person out front. This agent returned three days later and rang the bell again. When the seller reached for his card, the agent ripped it up himself and smiled. The owner roared with laughter and invited the creative agent inside.
 
The lesson is don’t take yourself too seriously, but persist until you succeed.

Are you a loan officer, title company rep, home inspector, home warranty salesperson, or termite treatment person looking for new business?

Do you have an ‘elevator speech’ for Realtors packed with a ‘USP’(unique selling proposition)? Are you able & willing to state the benefits (vs. features) of doing business with you and your company? If not, why not?

This week I attended a local MLS realtor tour and put a property on caravan. Several affiliates were present and stated their name and company in return for providing refreshment and covering the meeting room. Not one affiliate handed out cards, asked for business, or stated what differentiates them from the sea of salespeople in their industry.

Since I had too much coffee, and there only eight houses on tour, I challenged those affiliates to sell me on their services. One brave inspector said he was in business for over 20 years. Now, is that a feature or benefit? Of course, it’s a feature. In other words why would a Realtor care? What’s in it for the agents or their clients?

A title rep said she offered, “superior service”. Oh, please gag me with a spoon. That’s a cliché. Everybody claims superior service. Be unique or different. Or, forever ‘hold your piece’. Even the Taliban say they offer superior service.

One home inspector drove with the Realtors to view the houses on tour. In the car he shared that he was a custom home spec builder for 15 years prior to the market shifting. I was impressed, considering some home inspectors have little construction background. He also said he is the point person that does the inspections. I’m very impressed with personal service plus experience.

I’m impressed with a short ‘elevator speech’ loaded with benefits. Tell me why you are unique. Then give me a card or ‘item of value’. Ask for my card and send me a thank you note. And, please have the courage to ask me for some business!

What can real estate agents learn from the pesky, western diamondback rattlesnake? The same lessons agents can learn by staying away from toxic buyers & sellers. First, if in doubt, don’t go near their habitats. Second, be on the lookout for their presence. And lastly, listen for their distinctive sounds.

For over three decades I’ve run in the mountains surrounding Phoenix. On at least a dozen occasions I’ve come within a few feet of a rattlesnake. On every outing the snake felt me coming before I heard its distinctive rattle. Wisely, I chose to avoid the strike zone of the venomous viper.  

There are buyers and sellers that every agent should also avoid. They reside in every country and county. Their poison can be toxic on your time, and sometimes impervious to an errors & omission policy. The can paralyze your sanity, and pollute your stream of referrals.

For example, the other day I visited an expired listing. The exterior of the house had what appeared to be overgrown landscaping. The interior had well-worn, yellow sculptured carpeting. The pad was nonexistent in the main traffic areas. The bedrooms were cluttered. My experience told me this could be a snake pit.

Fortunately, the owner seemed friendly. When I asked why the house didn’t sell with the previous agent, I heard the rattling sound. “I don’t have to sell & I’m not coming down on my price”. The owner ‘hissed’ and said she had one low offer and she believed there were other ‘verbal’ offers that were never presented.

Snakes can be stubborn, and when confronted can become hostile. This seller knew all the comps, pendings, and active listings in her area. She believed the “feng shui” and “energy” in her home should command a premium price. When a seller tells me their ‘unique selling proposition (USP) is an energy force, it is a signal to leave this ‘twilight zone’ before the snakes begin to slither.   

Service that succeeds or sucks

 

Does your customer service succeed or suck. Ask your client. Their perception should be your reality, if future referrals are important. Real estate agents can learn about successful services by studying other businesses.

 

Recently, I rented a car from Enterprise. After walking around the vehicle to look for dings and dents, the agent asked about my favorite radio station. When I drove off the lot with the rental car, that station was playing and preset button #1 was set to that station. I was very impressed. Real estate lesson: Ask questions & follow-thru.

 

A few weeks ago I visited an attorney for a consultation. He had a legal tablet and took notes as I spoke. I was impressed that he paid attention and wrote down what I was saying. He could have been doing a crossword puzzle. But, I was impressed. Real estate lesson: Listen carefully & take some notes.

 

Less than a month ago, I went into Border’s books to get a particular title. The clerk said they had two copies that were about to be sent back to the distributor. I asked if I could have a discount if I bought both copies. The manager said emphatically, “No way”. I didn’t get upset. But, I plan to use Amazon for future book orders. Real estate lesson: provide some sort of deal for volume buyers & sellers (a free home warranty or appraisal?).

 

During the past few months, I’ve seen dozens of funny commercials for Enzyte (male enhancement). As you can imagine, I don’t require such supplements, but some people do. The company mascot “Smilin Bob’ makes me laugh every time I see him. The TV ad mentioned a free t-shirt with Bob’s photo. I wanted one and called the 1/800#. The company would not sell a t-shirt without ordering a two month supply. I hung up. Real estate lesson: make it easy for clients to buy and sell without any bait & switching.

 

 

 

“If you had a choice to burn at the stake or freeze to death, which would you choose?” I remember being asked this thought provoking question years ago.

It reminds me of some people who, under stress, have red hot volcanic tempers. Others have a tendency to turn ice cold and withdraw into themselves. Both are toxic tendencies that are tough to take.

 

Recently, I closed on a property where the retired couple wanted to move to the other side of town to be near their son & grandson. The weekly one hour drive each way was getting tiring. The Irish husband wanted to move if he could get his price. Even though his health was failing, he put more importance on his financial means than his family matters.

 

Rick Warren, author of The Purpose Driven Life, said, “Humility isn’t thinking less of yourself, it’s thinking about yourself less”. A pundit once quipped, “Middle age is when a broad mind and a narrow waist change places”. Humble people don’t burn or freeze others.

 

Earlier in the year I listed a property for a former client who had lost his job, had a medical procedure, and had his wife leave him, all in the period of one month. He was angry and upset with everyone but himself. His next door neighbor commented that he felt many of the wounds were self-inflicted.

 

A wise man once said, “It’s always better to look in the mirror before you stare out the window”. The bible says to look at the log in your own eye before you notice the splinter in someone else’s eye.

 

If you look in the mirror, or at a client and see hot, volcanic lava, or frigid, frozen feelings it’s time to make some changes. 

One of the benefits of obtaining a prelisting appraisal is to verify the square footage and avoid embarrassing and costly mistakes that cause deals to vanish and attorney’s to appear out of thin air.

 

For decades, I have asked sellers to obtain an independent appraisal at their expense as part of the listing due diligence. It is also a litmus test to see if the seller is ‘serious about selling’ and willing to invest some funds, and divest some ego from the pricing process.

 

Recently, I listed a two story basement home that the owner said was 5800 sq ft. The tax assessor confirmed this figure, and it was listed on a prior MLS plano. The seller was reluctant (too cheap & smug) to obtain an appraisal. The property eventually sold and appraised about 100k below the list price and 75k below the contract price.

 

The seller was certain his prized possession would appraise for “At least 500k”. He told the buyer and both agents that he felt the property was “Lucky”. This is one of the reasons Feng Shui drives me crazy. Lucky is a great name for a dog or a cigarette, but not a property.

 

The appraiser said this ‘lucky’ property had 4976 sq ft not the 5800 the seller claimed. Once again, real estate confronts reality. The buyer did not want to pay above appraisal and went looking for another home. The seller is considering an independent appraisal in hopes of justifying his elevated expectations.

 

Years ago I read about a lawsuit where the buyer successfully sued the seller because the house he purchased had more square feet than was stated. Most buyer would be elated to get more for their money; but, not this buyer. His attorney alleged the buyer would have more taxes to pay, higher utility bills, and higher insurance premiums. The judge agreed with the plaintiff.

 

There are dozens of great reasons to obtain prelisting appraisals. Avoiding the ‘shrinking house syndrome’ is one of them. Staying away from litigious buyers is another.

Is it wise for buyer’s agents to rely on representations made by the seller or listing agent? Is it smart for a listing agent to rely on statements made by their seller, or copy information from an expired listing, or similar property in a subdivision? If in doubt, don’t.

 

A very seasoned agent in our office recently listed a property for sale in a retirement community. The elderly woman said her monthly HOA fee was $175 monthly. This was written in the MLS remarks. The property sold for cash and closed within one week. The buyer was not a ‘happy camper’ when they realized after closing that the HOA fee was actually $225 per month.

 

The buyer’s agent pointed their finger to the listing agent. The buyer asked for $3,500 as compensation after filing a complaint with the board of Realtors and the real estate department against the listing agent. Apparently the buyer missed the info on the CC&R/HOA disclosure and the seller forgot to include this detail on the seller disclosure forms.

 

In fairy tales everybody lives happily ever after. In real estate tales mistakes are monetized and buyers file complaints, retain attorneys, and seek compensation through arbitration. The best way to win lawsuits is to avoid them and verify data if it may be used by a plaintiff in the future.

 

Another experienced real estate friend of mine listed a townhome for sale. He looked at similar MLS entries to determine the units were approved for FHA financing. The buyer relied on his representations. Imagine the buyer’s dismay when in escrow the lender stated that the property no longer qualified for FHA financing.

 

In a perfect world the buyer would have said, “To err is human, to forgive divine”. This buyer was different. The attorney monetized the additional down payment and slightly higher interest due to missing the loan lock and asked the listing agent for $15,000. Fortunately, my friend had a $2,500 E&O deductible to absorb the ruling.

 

The early bird gets the worm. The lazy bird gets a commisionectomy. The copy cat learns expensive lessons the hard way.

 

Do you remember the movie Love Story? It was a hit several decades ago. The most famous line in the movie was, “Love is never having to say you’re sorry”. Some agreed with the quote wholeheartedly. Others considered it the most insipid line of all time.

 

Personally, after flip-flopping on the issue, I have come to agree with the quote. In my opinion, if you are in love you should avoid the word ‘sorry’. Use a more courageous phrase such as, “I was wrong”.

 

A mentor once told me about a ‘four step apology’. The first step is to say, “I was wrong”. The second step is to state specifically what you did that was wrong. Step number three requires you to say what you plan to do differently in the future. And, the final step is to ask for forgiveness.

 

The word sorry is excluded from the apology because saying you’re sorry does not admit guilt to being wrong and contrite. When I was growing up back east my Italian friends would raise their voices and say, “Yo, I’m sorry, get over it”.

 

I made a big mistake sharing this four step apology with my wife. She loves it, particularly when I make a mistake. She now simply smiles and holds up four fingers. That’s her way of saying, show me how strong you really are, admit you are wrong and ask my forgiveness.

 

At first it was more difficult to use this formula than bench press 325 pounds. As time went on I began to realize that in the second half of our lives, God measures us by the size of our hearts, not by the amount of weight we can lift, or the number of listings or sales we close.

What’s the difference between tooth decay and price decay?

Not much. Currently, in the Phoenix metro market repos and short sales are over 50% of the sales volume.

This aggressively priced inventory has eroded the median price, appraisal values, and expectations for serious sellers.

In order to prevent tooth decay, dentists suggest brushing and flossing frequently. In order to prevent price decay seasoned agents warn sellers to price their properties aggressively and implement staging suggestions immediately. Some sellers avoid sound dental hygiene and proper pricing strategies.

Recently, I went to my dentist for a six month check-up. He said a cracked tooth he had been watching for decades had begun to decay and it needed a crown. My thought was get it over fast. I knew, liked, and trusted this dentist. The price of his services was a cost of doing digestion.

Imagine if he said he could drill and complete the job in 15 minutes. Or, he could drill one millimeter each week for the next several months. It would be my choice to prolong the pain and agony, or act decisively and swiftly right now.

Many sellers make the incorrect choice by delaying the decision to lead the market with proper pricing. Instead some sellers timidly and slowly chase the market downward only to find the market has receded more than their price adjustment.

Timid sellers experience price decay and equity erosion.

A new patient once asked my dentist what he needed to do to minimize his dental work. My dentist said to floss and brush his teeth daily. The patient replied, “All of them”? To which the dentist commented, “Only the ones you want to keep”.

In order to avoid tooth decay, brush and floss every day and visit your dentist every six months.

In order to avoid price decay, price aggressively and stage attractively before the house goes on the market.

The shortest distance between two points is a straight line. The shortest distance between an offer and acceptance may be a simple phone call or email letter of intent.

 

Recently, I had a buyer’s broker submit a low offer on one of my listings. There was a nine page purchase contract, HOA addendum, and lender prequalification letter. Of course, there were no comps attached to justify the lower price. The offer was immediately rejected by the seller, and the buyer’s agent was disappointed.

 

If this agent had simply called the lister before, or after showing the property and asked if the seller would entertain a low offer, she would have been told to save her time and find another property for her bottom fishing buyer. If her buyer insisted on submitting an offer, she could email the details and receive a quick written rejection.

 

Another agent called on this same property and asked if the seller would entertain a low offer due to a short sale that recently closed in that area. I was disinclined to acquiesce to her petition. Since I was unsure of the exact extent of the seller’s pricing position; I offered her the opportunity to speak with the seller directly. She presented her position to the out of state seller. He declined her price, but did state what he would accept.

 

This agent saved herself and her buyer a lot of time and false hope. She helped the seller see their property objectively from a buyer’s point of view. She helped the seller quantify their bottom line. And, she helped the listing agent obtain a potential price adjustment.

 

The KISS formula works well in any market. Keep it simple salesman. One phone call can save a lot of time, and a few trees. An email or verbal letter of intent is a helpful tool to avoid the paperwork jungle.

Is it advantageous for a buyer to write multiple offers on their top two or three property selections, or pick the best and forget the rest?

 

Recently, I represented a seller and we received an offer that had a multiple offer addendum attached. This told us that this buyer had a few properties they liked and ours was one of them. Without this addendum the seller might have countered the 3% closing costs the buyer was requesting. The seller reluctantly accepted the offer without any changes. This property is now in escrow.

 

A few days later, that same seller viewed ten properties and made multiple offers on the top three choices. In my opinion, in a balanced or buyers market, a multiple offer addendum can work in a buyer’s favor. The seller realizes their property is one of the chosen few, not necessarily the chosen one.

 

During a seller’s market some savvy agents use escalation clauses for their buyers. This form says the buyer will pay a certain amount over the best offer, if multiple offers are present. The amount is capped and another competing offer must be shown to the escalating buyer’s agent.

 

Another novel selling strategy is the reverse offer. The listing agent and seller tender an offer to any interested buyers that view their property. Who said only the boys could ask the girls to dance? If a buyer seems interested, views the property several times, or asks a lot of questions; it may be time for a reverse offer.

 

A reverse offer is also a good listing tool in a buyer’s market. Many sellers are looking for an ‘aggressive’ listing agent. The mere mention of negotiating a reverse offer can differentiate a listing presentation.

 

When the going gets tough, the tough get going. Multiple offers, escalation clauses, and reverse offers are tough tactics for tough times.

"To err is human, to forgive divine". The problem is some buyers would rather litigate than forgive.  As the markets accelerate, it's important for listing agents and buyer brokers to remember, "If in doubt, check it out".

For example, a few days ago an agent poked their head in my office to ask my opinion of a pressing problem.  They were the listing agent on a deal that had just closed.  The elderly seller said her HOA fee was $170/month.  The buyer was represented by another firm and was furious that the HOA fee was actually $220/month.  Have you seen the bumper sticker that says 'oops happens'?

The buyer's agent played Pontius Pilot and washed their hands of the matter.  They suggested the buyer contact the listing agent directly and ask for $3,300 as compensation.  The listing agent was unsure of how to handle the issue.  What would you suggest?

Did the listing agent or buyers broker verify the amount of the HOA fee?  No, they relied on the representations of the seller.  The HOA transfer disclosures arrived at the last moment and were not reviewed by either agent, or the buyers.

Recently, another Realtor friend of mine listed a vacant town home.  He relied on another active listing in stating that the residence was approved for FHA financing.  This meant a lower down payment and more favorable rate.  The buyer and her agent relied on this representation, and wrote an FHA offer.  While in escrow they discovered the unit was no longer eligible for FHA loans.

The buyer's attorney litigated for a $15,000 fee from the listing agent for the misrepresentation.  My friend wrote a $2,500 E&O deductible check and lost the suit.  One prelisting call to a lender would have determined the actual financing options.

If in doubt check it out. Or, be prepared to take your checkbook out.

Tina Turner is releasing a remake of her classis hit ‘What’s love got to do with it?’.

The new version is dedicated to stubborn sellers who refuse to lead the market with a competitive price. The new song is entitled: “What’s price got to do with it?” Everything, Tina replies in her timely tune.

 

The other day I asked a seller why they felt their home remained unsold. The reply caused me to roll my eyes as I was driving. The seller said, “It can’t be the price”. Really! Their small home is neat and tidy but backs to a major arterial street running through their city. The selling solution is simple. Move the property away from the busy street or periodically lower the price.

 

Selling a house does not have to take longer than the gestation period for a baby. It should not take several agents, several tours, multiple open houses, dozens of helium balloons tied to signs, baked bread aromas, Saint Joseph statues, daily novenas, pilgrimages to sacred shrines, or incense and peppermints. For Tina’s sake, lower the price.

 

One sage said, “The only constant is change”. The world is changing. People are changing. The real estate market is changing. The stock market changes. Styles change. Why can’t sellers realize prices need to change to attract more buyers and better offers?

 

Personally, I feel Saint Joseph has better things to do than help sellers locate buyers for properties that are overpriced. One creative company has come out with a statue of Vincent Price that can be buried in the backyard. Whenever a seller is unsure why their house is not selling they are told to repeat the special mantra in front of the buried piece of plastic. “My price is upside down”.

 

Price has everything to do with it.

 

1)      Talk too much. A listing appointment is really an opportunity to listen. Usually the party that is not talking is in control.

2)      Don’t ask questions. Flip the pages of that ‘brag book’ or PowerPoint presentation as you smile down memory lane showing pictures of your trophies, terriers, and tots.

3)      Don’t dress professionally. People seldom judge a ‘book by its cover’. But they do judge salespeople by their attire, fingernails, and eye contact.

4)      Don’t use visuals. Assume people enjoy the sound of your voice. See the dog sleeping in the corner. He’s probably bored. Intangible products need to be tangibalized with colorful graphics.

5)      Forget the difference between features and benefits. Agents may be impressed with years of experience, or big teams. Sellers need to know what’s in it for them.

6)      Keep your cell phone volume high. Interrupt the presentation to answer the phone or send a text messages, especially with older sellers. Use words like hookup, twitter, and homey. Ask about a special gang sign.

7)      Don’t ask for the listing. Assume the seller should ask you to be their agent. Encourage sellers to ‘sleep on it’, get a second opinion, or wait for the market to improve.

8)      Don’t use neurolinguistics. If the seller speaks slowly, be different, speak swiftly. If they smile, you frown. Show them you are serious. If a seller speaks softly, you should shout and show who is in control.

9)      Don’t examine expectations. Never ask why they want to sell, when they want to move, or what they owe on the property.

10)  Don’t say thank you, or follow up with a thank you card. Courtesy is for sissies. Show up late for the appointment. It proves things take time.

The secret of selling houses is for sellers to follow the ‘Four P Formula’: pricing, patience, positive thinking, and prayer. This is similar to the ‘Four P’s of Marketing’: product, price, promotion, and place that students study in college.

 

L.S.B. Leaky found fossil remains in the Olduvai gorge, and  Neanderthal camp drawings that prove that cavemen said, “A cave properly priced is half-sold”.

These words of wisdom have been modernized into the Realtors adage that, “A house properly priced is half-sold”.

 

There is a fascinating show on television that allows viewers to discover how magicians perform feats of magic. A recent program showed how a woman submerged and sealed in a barrel of water was able to escape to another barrel.

The trick involved a hidden pump that quickly removed the water and then forced it into the second barrel. Proper pricing is magical and works every time.

 

Sellers and agents must firmly believe in Say’s law: “No good or service will go chronically unsold as long as prices remain flexible”. In no way does this maxim state that a seller has to ‘give their house away’. Aggressive pricing and staged reductions are different from ‘distressed property dumping’.

 

In the Phoenix metro market the average days on the market is around five months.

Sellers need to realize that home selling is a stressful process that is measured in months not minutes. Only a deep discount can offset competitive offerings and slow absorption rates.

 

Life is a journey, not a destination. It is important to enjoy the ride even if it involves selling a house. All employees relish positive comments. Real estate agents are no different. Prolific praising precludes poor performance.

 

Numerous studies show that Americans believe in a higher power. Selling a house gives owners and agents the opportunity to practice what they preach to pollsters.

Pray for our nation, our president, our economy, and a buyer who will cherish your listing.

 

Selling houses is simple, it’s just not easy. Practice the ‘Four P’s’ for smooth sailing.

There is a big difference between a seller being on the market vs. in the market. To put a home on the market a seller hires a real estate agent to list a house for sale. If that house is in the market, agents and buyers view the property and make offers to purchase the house.

 

A fishing analogy would be if the bait is floating on top of the water, but the fish are in the lake 25 feet below, the fisherman will get a suntan but will not hook any trout.

The wise angler will continue to lower his bait until the fish begin to bite. A novice will curse the guide, and consider golf as a hobby.

 

In her book, Elisabeth Kubler-Ross said there are 5 stages of dying: denial, anger, bargaining, depression, and acceptance. Many home sellers go through 5 similar stages on the way to a sold sign or expired listing. Let’s look at those stages in detail.

 

Denial is a psychological defense mechanism that lets a person ‘off the hook’ for any responsibility for a problem, such as a home not selling. Many times the agent becomes the scapegoat. It’s always easier to blame a Realtor than locate the real problem. Frequently the problem is improper pricing, greed, and impatience.

 

Anger is a choice. It is seldom a wise choice. Some people actually enjoy ‘lighting their hair on fire’. It’s a relatively inexpensive way to gain attention. It’s always easier to ‘curse the darkness, than light a candle’.

 

Bargaining may be counter-intuitive when selling a property. “If the buyer makes me an offer, I’ll negotiate with them”. Or, “Why can’t the buyer make me an offer”? Fish (and buyers) are very smart. They usually wait for the bait to be lowered to their level. Even flying fish seldom jump into the ice chest in a boat.

 

Depression can be avoided if a seller’s ‘mental maps’ reflect reality. They seldom do. That’s why many listings expire. Most properties are overpriced, and improperly staged. Many sellers never ask their agents what would they do if the property was their own.

 

Acceptance of an offer is what happens when a seller puts their home on the market, and then lowers the property into the market. Selling a house simply means accepting real estate realities.

 

Wouldn’t it be wonderful if there was something real estate agents could do that would guarantee they would receive no referrals! That’s right, absolutely no referrals! No warm calls from friends or relatives of past clients. No, referring agents to worry about, and interrupt the precious paperwork, BPO’s, and short sale negotiation calls.

 

The one simple secret that will guarantee no referrals is ‘don’t ask & don’t tell. Don’t ask for referrals, and don’t tell your referring source what happened to the lead. Let’s examine each suggestion in detail.

 

When I was young, I attended Catholic grammar school. We called it CCC: Catholic Concentration Camp. The nuns told us they needed to, “Say something three times for the normal mind”. They believed that repetition was the mother of learning. They also seemed to believe that punishment was the father of education.

 

Let’s say Sister Mary Saint James decided to leave the convent and get her real estate license. She would ask all her friends, relatives, priests, and former students to refer prospective clients to her. She would ask for those referrals at least three times, if you had ‘a normal mind’.

 

Sister Mary Saint James would also keep you abreast of her progress in working with the referral. She might also say a few prayers for you, as her way of saying thank you. And, when the transaction closed, Sister Mary would probably send you a thank you note, or some rosary beads. Compare Sister Mary to a referral I gave to another agent last week.

 

A doctor was in town for a few days and needed help leasing a few rental properties. I referred the client to another agent who did property management in our office for no consideration. My expectation was that I would receive an update and a thank you note. I received neither. That agent will never receive another referral.

 

Albert Einstein said true genius is taking the complex and making it simple. The simple secret of receiving no referrals is: don’t ask for referrals and don’t tell the referring source that you are appreciative of those leads.

 

 

On a recent Monday morning I received a call from a seller I represent who was ecstatic that his house was show over the weekend. An agent first previewed the property and said it was, “Aggressively priced and showed great”. This property would be one of four the agent would show to their client. My seller felt he had, “A 25% chance that his property would be sold”.

 

Wouldn’t it be nice if real estate agents and buyers meant what they said and life was as logical and linear as mathematics?

 

I told my seller that we would get some feedback about what the buyer thought after they viewed the property. This is more important than what an agent says previewing the property before the showing. Most agents and buyers are complimentary to a fault. Many buyers and agents are brutally honest ‘behind the scenes’.

 

For example, whenever I see a baby in the arms of a mother I usually say, “What a lovely baby,” to my wife. When we are out of range I tell my spouse the ‘rest of the story’.  “Didn’t you think that kid had a weird head?” Or, “Did you see the nose on that baby? It looked like the beak on a peregrine falcon.”

 

There is a big difference between feedback and flattery. It seems the bigger the ego the less this difference is apparent. After viewing a dozen houses, buyers and agents begin to forget what they saw. In order to make the time go faster some buyers actually joke about a seller’s decorating.

 

If an agent shows a buyer four homes, does each seller have a 25% chance of receiving an offer? No way, Jose! A typical buyer will love one, like another, and dislike the last two.

 

Sellers deserve showing feedback. Sometimes that feedback is accurate. At other times it is inaccurate. Many times people don’t say what they mean, or mean what they say.

Top Ten Tips from my CDPE class

 

1)      Complete more short sale deals by taking the Certified Distress Property Expert class & learn to properly package, present, and promote the offers.

2)      Submit only one offer to the lender (put this verbiage in MLS).

3)      Obtain more showing by promoting the designation (put this fact in MLS remarks).

4)      E=MCC think like Einstein. Watch the sellers: expectations, motivation, cooperation, and communication.

5)      Consider obtaining a retainer from the seller (skin in the game).

6)      Make sure the initial HUD-1 allows for delays & surprises.

7)      Pre-qualify the seller: Is there really a hardship?

8)      Obtain written permission to reduce the price every two weeks,

9)      An incomplete package/proposal is a major reason short sales are delayed/declined.

10)  Check the preliminary title report every 30 days.

Real estate agents should realize it’s easier to keep statistics than become a statistic. The market is dynamic, and small shifts can become trends and niches to exploit.

 

Last week, I went on a real estate tour sponsored by a local title company. Before the meeting began one agent was ecstatic because she had received multiple offers on her last several listings that were owner occupied. She was adamant that the market was making a miraculous come-back.

 

Another agent acquiesced and stated that sales last month were up substantially in the past 30 days over a year ago. A third agent mentioned that the new stimulus bill was signed and missives from NAR were positive. The small group was about to become a real estate revival. Ding, dong, the wicked recession witch was dead.

 

It was time for ‘statistic man’ to quell their ‘irrational exuberance’. I asked what percentage of those closings were short sales or REO’s. The crowd began to hush. One outspoken agent quipped, “Why does that matter?” It was time for data, graphs and charts to replace warm, fuzzy, personal feelings.

 

The Phoenix metro area has inventories levels that are twice those in a balanced market. The recent spurt in sales was predominantly in the lower price ranges. 91% of recent sales were below 350k. Properties over one million dollars have a five year absorption rate and severe financing limitations. 75.2% of pending sales are from short sales and repos. One third of these sales are cash indicating investor bottom fishing.

 

It’s a great time to buy in Maricopa County. First time home buyers have an $8,000 tax credit, lots of inventory, FHA financing with low down payments, and pricing that allows payments less than rents. But, in my opinion the market will remain unbalanced in favor of buyers for several more years.

 

Local real estate agents should put the seller champagne celebrations on hold for another 48 months. In the mean time study the statistics and know your local numbers.

 

Most agents realize that a home properly price is half sold in any market. Some agents discover multiple offers even at the list price or higher in buyer’s markets if the price is right. But, it takes a ‘special’ property to receive multiple ‘lowball’ offers. I’m blessed with the opportunity to represent one of those ‘lowball’ magnet properties.

 

The property is in Mesa, Arizona. It was listed around Christmas in 2008. Little did I realize that this would be the gift that keeps on giving. In the past three months there have been dozens of showings and three ‘lowball’ written offers, plus several other ‘lowball’ letters of intent.

 

What sort of marketing magic does it take to attract numerous showings and ‘lowball’ offers in a market where many sellers are as lonely as the Maytag repairman? All the seller needs to do is make sure the property looks decrepit.

 

This past week, I showed the property to a lovely couple. As they approached the property from the front they glanced in each other’s eyes. That look said weeds and peeling paint form a strong first impression if you are looking for a haunted house.

 

The faded yellow front door did little to cheer up the dubious buyers. They could tell the floors were real wood by the rotted board that was not removed after the recent termite treatment. The ‘dust bunnies’ on the floor, and dead flies on the window sills were silently whispering, ‘lowball’.

 

Mrs. Buyer commented that the drapes reminded her of a “funeral parlor”. Seldom have I showed a property to a couple that used the word different so frequently. I could see the mental estimate for needed repairs race by the 100k mark. To my surprise, they decided to view other properties rather than join in the lowball line.

 

The showing feedback and listing agent has suggested that the seller needs to invest some money in the property. Good intentions, numerous painting estimates, prayers, a buried statue, and a positive attitude will not stop the laughs and multiple ‘lowball’ offers. Looking back, the nuns were right, God helps those who help themselves.

A savvy sage once said, “You never get a second chance to make a first impression”. In a competitive buyer’s market that is a price war & a beauty contest, sellers need to realize buyers horribilize house defects and avoid deferred maintenance rather than making any offer at all.

 

For example, I recently listed a large estate property in Mesa, Arizona that is situated in a good area on almost an acre lot. The seller was advised to paint the peeling fascia trim and front porch immediately to create a good first appearance. The executor declined the $4,000 paint job, but attracted several offers around $100,000 below the list price. The property remains unsold as the days on the market increase.

 

This past week I closed on a property where the seller was reluctant to spend a few thousand dollars prior to the listing for cosmetic repairs such as a broken arcadia door, pool light, etc. The seller who needed to sell due to a divorce did accept an offer that was $82,000 below their current appraisal.

 

It is seldom necessary or wise for sellers to make capital improvements prior to selling. But, it is very intelligent to make cosmetic repairs particularly those that can form a first impression for buyers. Broken doorbells, fading front doors, rusted door handles, and cracked windows are repair items that pay dividends.

 

Some agents employ a ‘smooth move’ approach. This includes pre-ordering an appraisal, termite inspection, and home inspection. All three items will cost a seller less than $1,000.This upfront investment is a lot less than the first price adjustment.

 

As the song says, there may be fifty ways to leave your lover. Buyers only need one reason to leave a property without making an offer. It’s much easier to invest a few hundred dollars in cosmetic repairs prior to listing, than throw tens of thousands of dollars at a buyer who is retreating from an ugly property inspection.  

1)      Fitness is the ‘fountain of youth’. Exercise daily for 45 minutes.

2)      Aging is mandatory, Decay is optional. 70% of premature deaths are from sedentary lifestyles.

3)      Diets don’t work long term. Simply quit eating crap. Good nutrition begins in the supermarket. Don’t buy junk food. Stop eating fast food.

4)      Aerobic exercise cuts your risk of heart attacks by half. Woman have more heart problems than men.

5)      Angry people have four times the mortality rate of happy folk. Don’t worry, be happy.

6)      Isolation is fatal. Invest in ‘social capital’. Even a pet will prolong your life.

7)      Arthritis is an inflammatory disease of a sedentary society. Fit or fat is a simple choice (and a great book).

8)      Get a heart rate monitor and wear it when you exercise. Fat burning begin at 60% of your maximum rate (220 minus your age).

9)      Join a group. Form a group. Make more friends. Smile frequently. Compliment people and loved ones daily.

10)  Read Younger Next Year (www.youngernextyear.com), Fit or Fat, and anything by Dr. Dean Ornish. 

Top Ten Tips for Linkedin

 

1)      Linkedin is a place where relationships matter. This is the company slogan of the largest network of online and business professionals.

2)      Improve your search engine results and Google page rank by completing your profile (www.linkedin.com) and keeping it current.

3)      Invite your peers, spheres, and contacts to connect with you.

4)      Be proactive in making new connections and growing your network.

5)      Search for, and join groups you have an affiliation with.

6)      Expand the left navigation menu to see all options.

7)      Send and solicit recommendations from first degree connections.

8)      Use relevant applications such as Amazon book lists, Slide show, or Google presentations. Upload your listing presentation or menu of services.

9)      Click ‘learn more about Linkedin applications’ and watch the short Utube videos in the Linkedin learning center.

10)   Read Linkedin for Dummies for all the details.

Real estate agents can learn a lot vicariously about winning or losing service efforts by studying other businesses.

 

For example, I recently rented a car from an Enterprise dealer. After completing the contract, and examining the car for damage, the rental rep asked, "What's your  favorite radio station". It seemed like an odd question, but I replied 105.5FM . When I entered the vehicle to drive away I noticed the radio and #1 preset button was set to that station. Imagine that. They asked what my preference was then delivered. Now I'm a loyal Enterprise fan. They succeeded in exceeding my expectations.

 

Other companies have services that suck. Within the past week I called my AARP motoring plan to tow my car two miles up the street to a dealer. They said they would arrive in about 45 minutes. I glanced at my watch while I waited patiently at my office.

 

For the next four hours I called on the hour, every hour and asked the same question, "Wassup?" The wonderful folks at the AARP motoring plan and their local driver, obviously chose not to keep their customer informed. This is the reason airlines constantly update passengers about delays, to avoid mutinies.

 

A wise man once said, "Don't get upset, get even". And, that's what I plan to do. The next time my AARP motoring plan is ready for renewal, I plan to practice my Spanish – adios AARP amigos.

 

A few winters ago I was snow skiing in Colorado. I schussed by a photographer who was taking pictures of potential Olympians such as myself. He said the photo would be posted at their office at the base of the chairlift by the end of the day. I liked the picture and ordered several. The clerk received payment and said they would arrive by mail within two weeks. Imagine my surprise when the pictures arrived at my house within 72 hours. They over-delivered after framing my expectations.

 

Real estate agents should ask buyers and sellers what they expect. Time lines and bottom lines should be agreed upon. The agent's job is to then exceed those expectations and reap the compliments and referrals. 

 
A few decades ago Art Linkletter wrote a book entitled Kids say the darndest things. His television show had a similar section with children making foolish, but hilarious remarks.
 
In my opinion, there should be a modern remake of this book and program entitled, Sellers say the darndest things. It would give sellers the opportunity to share the specious sayings they confide to their real estate agents that undermine the goal of obtaining a sold sign.
 
For example, I recently listed a property in Mesa, Arizona that remained unsold with another agent. The accurate appraisal came in about 30k less than the list price. The seller said they would lower the price 10k after speaking with their daughter in New Jersey. Do you find that as amusing as I do?
 
Recently, I cancelled the listing of a family friend who was the executor of an estate.
He felt the 500k property was worth 1.8 million even after reviewing the appraisal.
This same seller found a discount broker to market the overpriced, functionally obsolete family abode, and has included the words 'as-is' in the MLS remarks. I decided to laugh, rather than feel frustrated.
 
The funniest thing I frequently hear from sellers is, "I don't have to sell". Imagine that, a seller suffering the slings and arrows of a buyers market with twice the normal inventory levels, half the usual sales, and 50% of those sales coming from vacant repo properties. Yet, they don't have to sell.
 
The second funniest thing I hear from seller is, "I'm not going to give my house away". Seasoned agents know this means the seller probably had problems during toilet training and is stingy, orderly, obstinate, and inflexible.
 
A copy of this article is being sent to Art Linkletter. Please email Art and tell him we need another book and show about The darndest things sellers say.

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Top Ten Tips From 2009 CRS Sell-A-Bration

 

 

1.    "When we are no longer able to change our situation, we are challenged to change ourselves" – Victor Frankel

2.    There are no such things as bad properties. There are bad owners. Avoid them.

3.    There are more 'orphaned' buyers now. Contact them.

4.    Short sale questions to ask the listing agent: a) What is the hardship? b) What is the shortfall? c) How many offers will you submit?

5.    Seller script: "What will you do if the market value is below the loan balance"?

6.    Short sale clause: Any subsequent offers will be in back-up position.

7.    Never submit a short sale offer to the lender that will not be accepted.

8.    Have Facebook business page.

9.    Great tech tool: Fujitsu Scan Snap.

   10. Seller script: Staging is cheaper than the first price reduction.

 

Just the other day I received a call from a seller who wanted to cancel his listing because he, "Wasn't happy".  What in the world makes people feel entitled to happiness just because they listed their home for sale?  Listing a home for sale should make a seller feel 'on the market', not happy!

In the past month this seller had lost his job, was diagnosed with cancer, separated from his spouse, and his 401k lost half it's value.  I shared books, tapes, and time with him.  He had breakfast with my Toastmaster group.

His property is receiving a steady stream of buyers, but no offers.  He was told he needs to be patient and periodically yet aggressively reduce his price. But in addition to sold sign, he want to be happy.

In my opinion, it is imperative for Realtors to ask clients what they are looking for in an agent.  In these turbulent times few people are happy.  Many people smile, but few are elated.  Agents need strong selling skills, bedside manor, compassion, and patience now more than ever before.

Agents are retained to secure a buyer in a reasonable time. They must be careful in wearing 'too many hats'.  I studied psychology in college, but I'm not a psychologist.  Nor am I a priest, marriage therapist, grief counselor, or bosom buddy. I can't sing, place a musical instrument, or make a seller happy.

Abe Lincoln said, "People are as happy as they make up their mind be".  Mr. Lincoln said that during the Civil War.  Half the nation hated him.  Southern Confederate soldiers wanted to do him harm. His wife was bipolar.  He had a child die.

This is a wonderful time to count your blessings.  Albert Einstein said, "Things that count, can't be counted.  And, things that can be counted, don't count".  There is a reason for every season. Realtors sell houses, not happiness.