Un-Dumbing the Industry

I am very encouraged today.  A little elated, actually.  Yesterday, John Powell and I met with seven members of the Help-U-Sell family in San Diego and Riverside Counties.  Our conversation was free-wheeling but seemed to focus mostly on marketing and deal-doing strategies.  As we got into the realm of Short Sales I had to sit back, and I started to smile to myself.  These guys, the survivors, know their stuff!

Short Sales are complicated things.  There are dozens of lenders, each with their own requirements, varying industry and government regulations to consider as well as the vagaries of investors on the secondary market.  To work them and work them in a way that makes them worthwhile, there is a huge volume of information a real estate professional must know and manage.  The level of detail, understanding and street-wise know how I heard when these folks talked about what they’re doing was astounding.

It took me WAY BACK (I mean, way WAY BACK) to 1982, when interest rates edged close to 17% and the only way you survived was by knowing financing, contracts, and sales strategies inside and out.  We called it ‘creative financing,’ but it was really just knowing your business so well you could make things happen even under impossible circumstances.  It was a great time to be a REALTOR, a time of pride, because you knew if the person sitting across the table from you had a REALTOR pin on their lapel and an HP 12-C calculator cranked up, he or she was probably just as smart as you and the two of you were going to put that deal together.

The boom years were a fun ride, like the latest offering at Six Flags.  But, like that Six Flags ride, the pace was fast and the lines of people pressing to get in on the good thing were long.  Few practitioners took the time to learn their business. Most just gripped the safety bar and screamed.   We (as an industry) got dumber and dumber.  It was almost cartoon comical . . .

Picture the agent and buyer standing outside the house that’s just been toured.  The buyer says, ‘So, if I put 20% down, what would my payment be on a 30 year fixed?’  The agent hems and haws, scratches his head and finally answers, ‘I don’t know . . . let me call my lender.’ That was 2005.

In the churning and collapse of our markets, the weaker ones, the ones who didn’t learn how to put a and b together to make c, fell by the wayside.  They didn’t have the depth of knowledge they needed to make it through this mess.  That’s why the ranks of REALTORS across the country are way down.  The survivors are a wonderful bunch of very sharp people.  Many are hanging on by their wits and their toenails waiting for the wheel to turn but from what I see, their grip is tenacious and they will make it around that bend.

Suddenly, the REALTOR is a hero again.

Is Proper Pricing Less Important Today?

Pricing is the topic for today’s training session at 11 Pacific Time. It’s always been a favorite of mine. You see, I learned early on in my career as a Salesperson that the best marketing I could do for my sellers was to convince them to price their home as close to market value as possible. All the marketing you might do, all the fantastic, cutting edge promotion you might undertake, is meaningless if the property is overpriced. Excessive marketing does not make a home worth more. I know: it’s a simple concept, one that is pretty obvious. But it’s striking how many sellers don’t realize it.

(I recently watched Maria Powell doing a listing presentation. At one point she said to the seller, ‘I’m sorry. I really wish I could make your home be worth $400,000. But I can’t. The best I can do is about $370,000 — that’s what the Market Analysis shows.’ )

I have always been a strong advocate of NOT taking overpriced listings. I look back 5 years ago and see that overpriced listings took longer to sell and therefore gobbled up more of an office’s precious marketing dollars. Truth is: every day you have an active listing on the market, it costs you money. And that’s just the tip of the iceberg. Think about the aggravation of dealing with an unrealistic seller wanting to know why you haven’t sold her (overpriced) house yet. And what about your reputation? So what if you have the best deal in town if your listings sit and sit and sit, unsold.

I always urged brokers and salespeople to fight the good fight, do everything they can to get the seller to acknowledge reality and then, if a realistic price cannot be agreed upon, to get up and walk. Don’t take the listing.

Today, I have to modify that stance just a bit.

It is still clearly in the seller’s best interest to price the property properly and we’re all about taking good care of our sellers (and buyers), urging them to do what’s best for them. But ultimately, what’s in the best interest of the Broker?

Every week we ask top producers where their buyer closings come from. Over and over they say the same thing: sign calls, ad calls, Internet leads, Open Houses . . . in almost every case, the buyer comes to us because of our listing inventory. So it’s clearly in the Broker’s best interest (as well as the best interest of ALL the sellers whose homes we have listed) for the office to have as many listings as possible. Listings are the net we cast into the marketplace to capture buyers.

So, what’s really wrong with taking an occasional overpriced listing? Even an overpriced listing will generate calls, right?

Here’s my new point of view:

If you’ve fought the good fight, if you’ve made as compelling a case as you possibly can and the seller still wants to overprice (that’s overprice, not grossly overprice), I think you might take that listing if:

  • You make it very clear you think it’s too high. By being clear when you take the listing, you eliminate the call two months down the road wondering why you haven’t sold the property.
  • You set a date four to six weeks in the future to revisit the pricing issue.
  • You ask every agent who tours or shows the property what they think of the price and you share that with the seller.
  • You give the Seller a Listingbook account or sign them up for some other ‘First to Know’ program so they can see what other homes are selling in the neighborhood, how the competition is priced, etc.

As an agent years ago, I found it helpful to put my unrealistic sellers in the car and take them out to see the competition.  They usually came back with a new appreciation for reality, especially if some of the competition were shiny new homes with flashy models.

Today, success in real estate is all about the buyer.  Can you attract buyer inquiries and convert them into prospects and then into sales?  Anything you can do to attract buyers is beneficial and nothing attracts them better than listings.

Question

So, ARE you more than a lockbox key and a fill-in-the-blanks purchase agreement? It’s all about the value you bring to the transaction from a buyer’s perspective. I think your value is huge, but I’m curious to know what you think. Why should a buyer choose to work with you rather than anyone else? Or rather than go it alone?

More on Value

I am really old.  I am so old, people in their 40s routinely call me ‘Sir.’  I’m so old, when I do crunches at the gym, I literally hear crunching.  I’m so old, my dog, Homer, thinks he’s an assistance animal.  I’m so old, young mothers burdened with babies and bags of groceries routinely hold the door open for me.  I’m so old a punk on the sidewalk called me ‘Grandpa’ the other day.

Having now publicly wallowed in all that wrinkly tommy-rot, I must admit there are some benefits from being older than dirt. One such benefit is the fact that I actually know a couple of things.

We’ve been talking about the Buyer Inquiry and Buyer Data Sheet and, today,  about Buyer Objections  (which I prefer to call Buyer Questions and Concerns . . . it’s less adversarial).  Often our conversation has gotten back to demonstrating your value to the consumer when he or she makes contact.  That seems essential.

Here is a Great Truth:   Nobody ever does anything they don’t want to do.

Let me repeat that:  NOBODY EVER DOES ANYTHING THEY DON”T WANT TO DO.  Even if they’re choosing the lesser of evils, they are making a choice.

So your task, when that potential Buyer makes contact, is to make them want to meet you.

As you probably already know, nobody who ever calls you for the first time wants to meet you.  Meeting you is the last thing they want.  They want to get the information you have as quickly as possible with a minimum of entanglement and to get off the phone.  They will pause and absorb only when something extraordinary happens:

  • Either the house they are calling about is absolutely perfect for them in every way OR
  • You demonstrate the ability to bring so much value to the home search and purchase process that the caller can’t wait to get together.

There’s a word for getting people to want what you have.  It’s called ‘Salesmanship.’  And when used properly, it is not dishonest, manipulative, opportunistic, harmful or fattening.  Great salesmanship is knowing your business so well that you shine like a polished gem.  Great salesmanship is being willing to educate the other person about a process in which you are expert.  Great salesmanship is knowing, right down to your marrow, that nobody can do a better job for this caller than YOU.  Believing so strongly in what you know and what you do, you reach out to consumers with near missionary zeal.  Really, gaining the right to help people make good decisions becomes your mission.  (In fact, I don’t think it would be a bad idea to slip that phrase into your cadre of dialogs:  ‘My personal mission is to help people make good real estate decisions.’ )*

For years, when I worked for Brand X, I devoted lots of time to meeting with and interviewing our top producing salespeople.  Because I was designing training, it was important that I knew what the top people were doing.  These great salespeople had a few things in common:  they all had a strong sense of mission about what they were doing.  They knew their business so well that they were supremely confident they were the best person to help the consumer.   And helping as many people as possible to make good decisions was the only goal that seemed to matter.  Honestly, I rarely met a great salesperson who could tell you how many deals they’d done this year or what their gross commission total was.  That wasn’t important to them.  What was important was the customer whose transaction had snarled and whose living room furniture was now being stored in their garage.  What was important was getting that family comfortably relocated before the start of school so the kids could go into the new situation on day one.  What was important was finding that perfect house in that perfect neighborhood with the mother-in-law suite downstairs so the family could be together.

When you have the accent on that syllable and can back it up with solid knowledge of inventory, finance and the real estate process your value just oozes out.   The potential Buyer recognizes it quickly and is anxious to meet you.  Suddenly he or she wants what you have.  I don’t guess I’ve ever heard anyone demonstrate the value he brings to a Buyer transaction any better than Jack Bailey.  He did it again today in our National Sales Meeting when he volunteered to role play a Buyer Inquiry call.  Luckily, we have tons of video of Jack doing this in the Download Library and you really ought to be taking a regular look at that wonderful material.

*For a real example of that sense of mission, I have a short video clip of a great salesperson. Cindy Coplin Mitchell works in Athens, Georgia and lives her business with passion every day. Here, she’s talking about working with FSBOs, but I think you’ll see what I’m talking about. I am sad to say, she does not work for us . . . but who knows? Enjoy!

New Website Features

We just got finished with another Tech Time Tuesday webinar with Robert Stevens.  Robbie shared some new functionality on the Help-U-Sell Broker websites that I think we should highlight here.  But first, some basics:

Your listings get on to your (new)  Help-U-Sell office website in one of two ways.  You either enter them manually via OMS or you input them into your MLS and it comes to your office site via the IDX feed you have set up.  (Note:  we are talking only about your new Help-U-Sell office site, the one that Help-U-Sell corporate hosts and maintains.  We’re not talking about your New Home Page website or your Point2 website or any other you may have.)

Generally speaking, your Help-U-Sell office website offers more capacity for images and greater functionality than most MLS’s, so once the listing comes into your website via IDX, you may elect to edit it in OMS, add pictures, virtual tours, or tag it as Help-U-Sell Homebuyer Stimulus eligible.  Here’s where the new functionality comes in.

In OMS, in the Listings area, when you access your listings, you’ll see a coded icon at the far left of the list of properties.  A grey circle with an ‘A’ in it means ‘Automatic’.  These are listings that have NOT had any changes made to them after they came over via IDX.  Because there have been no changes made, a price change input into MLS will automatically be reflected on your Help-U-Sell office website.  Note that in these cases, price will be the only change made in MLS that will update your Help-U-Sell office website.  Changes to status or comments made in MLS will not be reflected — and you’ll need to enter them manually in OMS to change your listing on your office website.

If, however, you make any change to your listing after it comes over via IDX — change the price or status, add pictures, edit comments, correct an error — the icon code on the left side of your list of properties will change to a red circle with the letter ‘M’ inside, ‘M’ standing for Manual.  From that point forward,  a price change input into MLS will also need to be input manually in OMS for the change to reflect on your Help-U-Sell office website.

I know this is a little confusing but it all gets down to the system you orchestrate in your office for listings and listing maintenance.  As a Broker, I would simply add a step to any change in a listing:  after making the change in MLS, make it again in OMS.  That way I will know that everything is up to date.  If, the change you’re making is a price change, when you get into OMS and see that the listing in question has the grey circle ‘A’ next to it you may decide to wait a day for the IDX feed to make the change.  (Me?  I’m going to make the change in OMS right then and there so that I know it’s done and it reflects immediately.)

Generally speaking, IDX feeds come in once a day, often in the wee hours of the morning.  So a price change made in MLS on Tuesday afternoon will likely come over until Wednesday morning (again, we’re assuming this is a listing tagged with the grey circle ‘A’, with no changes having been made in OMS.).

The other great bit of news on today’s call had to do with content creation and management on your office website.  You’re now able to add new pages of content to your new Help-U-Sell office website by going into the content manager in OMS.  This exciting development means you can go hyper-local with your office website, highlighting some of the nuances that affect your marketplace.  Perhaps your State or Municipality has a special program to encourage home ownership;  that might deserve its own page.  Perhaps your office is participating in a big local charity event; that might be another page.  Remember that every page of your website is indexed by the search engines so each page represents an opportunity to attract more visitors to your site and to generate more leads for your business.

The new Help-U-Sell office websites continue to  grow and improve . . . it’s an exciting process.  If you’re not tuning in to Tech Time Tuesday each week, you’re missing out on some great stuff.  Thanks, Robbie and team!  We appreciate the great work your doing for us.

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