prepare yourself for the task, flip to Chapter 12, which helps you determine and advise sellers regarding a home’s ideal price; Chapter 13, which helps you counsel clients regarding changes they need to make before showing their property; and Chapter 15, which helps you counsel clients through the final purchase or sale negotiation.
❯❯ Troubleshooting: Unavoidably, many times you have to be the bearer of bad news. Market conditions may shift, and the price on a seller’s home may need to come down. A buyer may need to sweeten initial offers to gain seller attention. A loan request may be rejected, or you may need to confront sellers because the animal smells in their home may be turning buyers away. Or, a home that buyers really want may end up selling to someone else.
Making the right financial decisions
When you help clients make real estate decisions, your advice has a long-lasting effect on your clients’ financial health and wealth. Their decisions based on your counsel will affect their short-term equity as well as their long-term financial independence. According to a study by the Society of Actuaries, the equity in one’s home on average represents 70 percent of one’s total assets. In most cases, home equity is the single largest asset that people own. Your ability to guide clients to properties that match their needs and desires, that fit within their budgets, and that give them long-term gain from minimal initial investment impacts their financial health and wealth for years to come.
Avoiding the role of Designated Door Opener
Before the advances of the Internet, the consumer’s only avenue to information about homes for sale was through a real estate agent. Every other week, agents received phonebook-sized periodicals presenting information on properties for sale, with each new entry accompanied by a small, grainy, black-and-white picture. I know that seems hard to imagine in our information-rich technological world.
Today, consumers can go online instead of going to a real estate office to launch their real estate searches. With a few keystrokes and mouse clicks, they have access to a greatly expanded version of the kind of information that agents used to control. There are tens of thousands of sites that offer access to real estate information and access to properties for sale. However, when consumers discover a home they want to see, they must contact either the owner or an agent to gain inside access. This is where things get tricky.
Fifteen years ago, only 8 percent of buyers found the home they wanted to purchase on their own through the Internet. Last year, 44 percent of buyers found their home online themselves and then contacted a real estate agent. The consumer is clearly doing more online research and finding what they want.
The mind-set that agents are overpaid and unnecessary to the real estate sale process continues to gain traction. This mind-set gains momentum especially when a robust market leads to low home inventories and the quick sale of homes that often receive multiple offers during the short time they’re on the market. Sellers feel that their home will sell no matter who lists it, so they go cheaper.
This mind-set has increased in intensity and breadth with expanded online access to real estate information. It has been further developed as companies like Zillow and Trulia grant broader information services in the real estate industry segment.
When times are booming, a segment of consumers and new homebuilders begins to question the value of the agent’s services against the associated fees. During the best of market times, some homebuilders even go so far as to sell their houses without allowing agent representation – or compensation.
The silver lining is that when times are good, so many properties are moving that the few listings affected by the agent-is-unnecessary mind-set hardly limit opportunity. Plus, booms don’t last forever. When the market swings back and forth, as it will many times during your career, you need to be prepared to adjust your offerings. The ability to master your present marketplace trends while working to prepare for the next market shift is the skill of elite agents.
Imagine that you’re on the game show Jeopardy!, and you’re given just seconds to provide the most important response of your career. Imagine that you’re asked to write down the question that prompts the answer: The function that makes or breaks a real estate agent’s success. (If this book contained music, you know what tune would be playing right now.) Okay, time’s up. How did you respond?
The moneymaking reply is: What is creating customers? How did you score?
Did you answer: What is customer service? If so, you gave the same answer that more than 95 percent of new agents give. In fact, more than 90 percent of experienced agents don’t win points with their answers, either. Only a rare few agents see customer creation as the golden approach that it is.
Rule #1: It’s about lead generation
You have to be excellent at customer development and customer service. However, in terms of priority, you have to first be exemplary at lead generation. Following are a few reasons:
❯❯ You can’t serve customers if you don’t create customers in the first place. And because customer-service excellence results from customer-service experience, customer development is a necessary prerequisite to outstanding customer service.
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❯❯ Between creating customers and delivering service, customer creation is the more complex task. Customer creation requires sales skills and ongoing, consistent, persistent prospecting for clients. It requires marketing, promotion, and branding of yourself