(This is Part 1 of a three-part series. Read Part 2, "Buyers, you’ll be wealthier if you quit renting," and Part 3, "‘It was never my intention to make you angry.’")
Are you talking too much and closing too little? A simple shift in your strategy can yield huge returns for years to come.
One of the fun ways to help rookie Realtors build their skills is to give them a series of objections and ask the group to come up with their best strategies for handling the situation. They normally come up with great responses, but they also end up making the classic mistakes that many agents make. Instead of taking control of the situation, they move into justification mode. For example, when a seller asks them to reduce their commission, they may explain that they receive only 25 to 30 percent of the entire commission because they have to split with their broker as well as the other agent. This strategy results in the agent having to play defense, rather than offense.
The key point to note is that when you find yourself explaining why you are right, you’re in defense mode. Avoid this by asking a question that makes your client feel in control while simultaneously setting up the closing process. There are hundreds of ways to do this. Here are some of the tried-and-true listing questions that work virtually every time.
1. What have you enjoyed about living in this property?
This is an excellent question to use at the beginning of your listing appointment. Instead of doing a "listing presentation," ask about the seller’s experience with their home. While they explain, take notes. This sends a nonverbal message that you care enough about what they say to write it down.
2. Will these features be important in your next home?
This sets up the closing process in two different ways. You can offer to search the Multiple Listing Service for properties that meet their criteria. By doing this, you increase the probability of getting the listing plus representing the sellers on their next purchase. If they are moving outside the area, you can offer to interview three referral agents in the city where they are moving. If your company does not provide relocation services in their area, go to RealTown.com or ActiveRain.com to see which agents are active in that area. Interview the agents as promised and get back to the sellers with your recommendations.
3. Would you like to obtain the highest price possible for your property in the shortest amount of time?
Virtually all sellers will answer "yes" to this question unless there is a divorce or some other dispute going on between the parties involved in the sale. This question helps you to transition into discussing your premium marketing plan that will help the sellers obtain the highest possible price for their property. Generally, it’s a good idea to discuss three or four unique ways that you will market their property. List the other strategies you will use on a handout entitled, "Premium Marketing Plan for Mr. and Mrs. Seller."
4. Which of these services would you like to use in marketing your property?
The answer to this question is almost always "all of them!" This question will assist you in defending your commission should that topic become an issue later. If the seller does ask you to lower your commission, follow up with the question below.
5. Are you going to list your property with an agent who provides the premium marketing services that you need to obtain the highest possible price in today’s market or are you going to list with an agent who provides less service?
This question is an example of a classic "alternative-choice close." Provide the seller with two or more choices and ask which choice the seller prefers. Normally the sellers will want all of the services that you provide. It’s smart to be prepared to walk away, especially if you’re in a down market. Agents who offer premium service deserve premium commissions. When you are willing to walk away, most sellers will agree to your commission. Given that there are too many listings in most markets at this time, there’s no point in working with unmotivated or unrealistic sellers.
6. Are you going to price your property where it will be sold next month or where it will still be listed next month?
It’s important to know how much inventory is on the market. Assuming that there are eight months of inventory on the market, the probability that the seller’s property will sell is one-eighth, or 12.5 percent. The probability that the seller’s property will still be listed next month is seven-eights, or 87.5 percent. Thus, in order to sell in any given month, the property would have to be in the top 12.5 percent of all properties listed in terms of price and value. If the sellers overprice the property results in the property continuing to be on the market rather than under contract.
Need help with buyers? Don’t miss next week’s column.
Bernice Ross, national speaker and CEO of Realestatecoach.com, is the author of "Waging War on Real Estate’s Discounters" and "Who’s the Best Person to Sell My House?" Both are available online. She can be reached at bernice@realestatecoach.com or visit her blog at www.LuxuryClues.com.
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