Tuesday, August 31, 2010

How to do a Successful Open House!

The great Open House debate has been going on for some time now. Does it work? Does it not work? Well there's a couple of answers to that age old question. So here we go:

We know attitude and expectation are more powerful than anything else. If you believe or don't believe something, you're exactly right! So, if you don't believe it will work, you're right. If you do believe it will work, you're right! Everyone wins. Now I realize it's not exactly that simple, so let's go further.
Open house results are about repetition and consistency. If you're an agent that thinks you can do 4 or 5 open houses and get 4 or 5 deals, WRONG! To really make this an effective part of your business you need to plan on 30 or more Open Houses a year.
Remember the purpose of the Open House is to sell the house you're in. Statistically speaking, it's not a high probability. It can and does happen, just not often enough to scream from the mountain tops. What it does accomplish is getting the word out, generate some buyer leads, possibly get some feedback on the home and make the seller happy if they've requested it.
Pricing is everything. You can do any number of marketing activities on an overpriced home and it will never sell. After all, how much marketing would it take to sell a nickel for ten cents? See my point?
Open House success will vary by location. In some markets it just won't work as well. The best way to find out if it will work in your market is to do one using the suggestions below. An example of a market where Open House doesn't work. In my market (resort) try doing one in the middle of January. There's no one here to even see the home! Internet saved our market from being a complete seasonal event.

So, (DRUMROLL) how to do it "right."

Select the right home. It must be priced well, in a great location, easy to find with few signs needed, great curb appeal, CLEAN and uncluttered. Go over 30 to 45 minutes early to get familiar with the home if you aren't already.
Invite the neighbors. On Thursday or Friday afternoon, go around the neighborhood and invite everyone to the event. I have a great script I will send you if you email me. The best part about this is a couple weeks later when it's SOLD, you can go back around to the same neighbors and let them know it sold so quickly. If anyone is thinking about selling, you'll be on the top of their list for sure.
Call/email people. Call/email all of your buyer leads current and past and invite them. Call the President of the Association. Chances are that person knows everyone in the neighborhood and may know who's moving soon!
Advertise in free resources. No longer do we need to do newspaper ads! Use all of the free resources you can find. Blogging, Craigslist, Facebook, Twitter, etc. Direct interested parties to a website with GREAT photos and lots of them.
Have the home "On Sale" for the event. Offer some incentive to prospects to visit like closing costs paid or small price reduction "for one day only."
Have pre-set-up showings for 2-3 comps that are slightly different than yours (a bedroom more/less, pool/no pool, etc) and offer to show to buyers at the end of your open. (If no takers, be sure to cancel the show requests!)
Have great signage. Make sure your signs are crisp and clean. Don't use flimsy signs that can blow over while you're not looking. Have balloons on the signs. Have as many as you can so they aren't missed. Have balloons on the mailbox at the home as well.
Stage the home if necessary. If you follow tip one, less of this will be needed or it may already be done. Make the home as clutter free and inviting as possible.
Set the mood. Play some nice soothing music. Have a few scented candles to create a nice warm aroma. Bring some fresh flowers for the table. Have great lighting.
Have snacks. If your area is "known for" a food or snack offer that food. If you have any visiting prospects it will make a nice conversation starter.
Smile, Stand Up and have Enthusiasm. There's nothing worse than walking into a stranger's home and seeing a boring, unenthusiastic agent sitting at the table or on the couch. Give the prospect a reason to stay by having great energy. A smile is infectious.
Have a great opening line. We teach people a great conversation starter to any incoming prospect is..."Which home in the neighborhood do you own?" You'll quickly find out who the neighbors are and get them talking. If they respond with "We don't." Simply say, "Great, what brings you into the neighborhood today?" Keep the conversation going from there.
Have a lender with you. If you get a "live" one the lender can pre-qualify them right there on the spot.
Have very nice looking fact sheets. Bullet points work best rather than long paragraphs. You can fit more in and they are more likely to read it.
Make it an "Event." Coordinate with your office all nearby Open Houses that day and have a map on the back of the fact sheet or on its own to each Open House. Support each other.
Ask lots of questions. If the prospects are truly motivated and need some help, they aren't going to come out and tell you. By asking questions and keeping the conversation going you build rapport and it becomes easier for the prospect to open up to you. The key is to keep them talking as long as possible. You become less scary the longer they are with you. Unless of course you're just scary. Ha ha...couldn't resist!
Final and BEST TIP of them all...Bring your current listing leads to the Open House. At 20 minutes before it ends, we are typically tempted to start turning off the lights and packing up and sure enough, another prospect will pull into the driveway! To stop that temptation, bring your listing leads and call them to tell them you've just done an Open House and what kind of results you got. Let them know that can be their home next weekend! If nothing else, they'll know you're working!

That's the list. Do you have anything to add? I will re-publish a final list if we get some more great ideas.

While I don't guarantee success with these tips, some may work, some may not. If you're going to do open house, these should help your results.

Last disclaimer...remember that Open Houses are time consuming and there's no "real" guarantee of anyone coming in. If you find yourself in that situation, make sure to have a list of Past Clients, COI, Leads, Expireds, FSBOs, someone you can call and talk to about real estate to make it a productive use of your time.

Thursday, August 26, 2010

Don't look now...the sky is falling!

I was reading some of the very articulate and interesting posts on the 27% news that has caused such a stir...so here's my post on it.

The 27% actually makes a lot of sense if you think about it or actually read the article. Considering the number of buyers who rushed to meet the tax credit deadline, it's not surprising at all and as stated in the article, was expected. Simply put, buyers who would have bought and closed in May and June, did it in April. April essentially "stole" those sales! ha ha...now there's a spin. Keep on reading and you'll see sales are expected to reach 5 million this year. The 20 year average is 4.9 million. There's even more positive news after that. So what's the problem?

Could it be that some of us forget we are SALESPEOPLE? We go around with our fancy titles and fluff here and there when people actually hire us to SELL. Isn't our job to give valuable information so our clients make the right choices. This is valuable information, now how can we use it to benefit our clients? What if we got into the habit of taking not so great information and finding a positive way to communicate it? After all, there's something good in everything if you're looking for it.

So, how are you using this information with your clients?

Wednesday, August 25, 2010

The Closer!

Do you want to be a better closer? Do you go on appointments and not even ask the prospect to do business with you? Being a skilled closer can easily boost your sales without working one minute longer. Think about it. Let's say you go on 50 presentations and have a 50% closing ratio. That's 25 deals. If you increased your closing skills to an 80% ratio, that's 40 deals! The best part is, you haven't worked any harder because you would have been on the same 50 presentations!

So how do you get better at closing? Below are a FEW ideas on this topic. I have way more material on this but I'll keep it short for this beautiful Wednesday morning.

Understand closing is simply the next step. Once you've given a great presentation to a qualified prospect, it only makes sense to close. It's really nothing more than a natural ending. After all, if you did a good job and they want your service, why wouldn't they say yes? So ask!
Identify what part of closing is hard for you. Is it because you don't know what to say or how to do it? Are you afraid of the rejection? Practice doing it. It will be easier with practice. Experts tell us that the sale happens after 5 to 7 closes, so ask one more time than you normally would. You might just be surprised with a YES!
We don't want to feel "pushy." That's a valid concern. This is why you practice what to say so it comes naturally. Remember, the only time you'll be pushy is if you're trying to sell something to someone that they don't need or want. If you're with a prospect, there's a reason. If you do a good job presenting, they will want it. We're not talking about selling ice cubes to Eskimos.
Closing is easier with a qualified prospect. When we take the time to pre-qualify each person for their needs, desires, motivation and time frame we have a chance to remove the rejection. If you qualify properly you'll know whether to close. If they aren't qualified, no rejection! After all, how likely are you to close and unmotivated person?
Be confident. Shaky skills prompt questions and lack of comfort. You have to believe in your own value and what you're selling before they can. The more value displayed the easier the close. So, write down the top 5 reasons you're the best agent for the job and be sure to use them in your presentation. Then they'll be closing you!
Be direct. Let's face it, in this market every minute they could be losing money on their home or missing the best house for them to purchase. Being direct shows you're a professional. They are expecting this from you, which is why they are on the presentation anyway.
SHUT UP! Once you ask, quit talking. Don't over sell and talk your way right back out. Nod in agreement, smile and wait for their response, no matter how long it takes. The more you keep talking the less likely they are to commit.
What's your best closing line? How do you rate yourself on this skill on a scale of 1 to 10?

Friday, August 20, 2010

How did I lose that lead?

Regardless of how you generate them, leads have to be managed. After all, the number one complaint from consumers is that we don't call them back. So to avoid that trap, here are some simple ideas regarding Lead Follow Up!

Have a definition of what a lead is. How long will you keep a lead in your system? Studies show the longer you spend following up on leads, the less business you do each year. Answer this question...A lead is someone who NEEDS to buy or sell within _______ days? My personal recommendation is no more than 30 days.

70% of your business should come from lead follow up. That's right...it's that important. 70% of the time you will have to follow up with that lead to get an appointment set. 30% of the time you will set the appointment on the first call. So here's a scary thought...how much business are you losing by not having a great system?

Lead Follow Up should be a daily activity posted in your schedule. Plan to spend 30 minutes to an hour a day calling your leads and setting up the appointment. A great time to do it is first thing in the morning. Call your hot leads and get some commitments which will start your day off with a great "high."

Remember leads have NO VALUE. Where do you go with your lead system or file and say, I'll take a paycheck please...I've generated all these leads, now pay me. Well, not in this business. Leads don't represent security. They have no value until they are a closed deal. Over-managing and over-protecting gets you where exactly?

The purpose of your LFU call is to SET AN APPOINTMENT. Period. Nothing else. Each time you follow up with a lead the goal is to get the appointment set. To make a sale you have to do a presentation. To do a presentation, you have to be on an appointment. To have an appointment, you need to generate a lead and get the commitment to meet. Simple as that. Anything else is just being a free information provider. Now, I do understand that you must give out some information to establish credibility and rapport. There is a difference between building trust and providing free information. Most of the time, you know when you've crossed over.

Accept the fact that you will cycle through a large number of leads each year. Imagine if everyone you talked to bought a house. You could do all your business in January and take the rest of the year off. :) Since that is unlikely to happen, it's important to quickly move to the next lead when you recognize one is dead. As the saying goes, "when the horse is dead, dismount."

Having too many simply hides the good ones from you. Accept the fact that if you don't qualify your leads, you will end up with a lot of "Fools Gold" rather than actual leads. For each lead, identify the date you will discard them if they haven't set an appointment. Not only will that help you get rid of the bad, it will force you into action knowing you only have that amount of time to convert them.

Implementing these ideas will help you convert the good ones faster. What are your thoughts on Lead Follow Up?

Tuesday, August 17, 2010

4 steps to a Price Reduction

So one of the biggest challenges my clients face is getting their listings priced right and sold. I imagine that is an issue we all have right now. The 4 steps I have listed here is a pretty good system to get the seller to adjust the price.

Here are some important points about working with sellers:

•Regular communication is a must. If you're not talking to them weekly, they will have less trust and rapport. They will be more resistant to taking your advice.
•Alternate your communication with email and phone. One week email with some kind of market information, even if nothing happened with their home. The next week call to speak to them.
•Motivation. Each time you call and speak to the seller, start your call talking about their motivation for moving. Motivation changes, sometimes it goes up, sometimes it goes down. The only way to find out what's happening is to ask. Just make sure their plans and time frame are the same. That way, they know you're paying attention and you're also reminding them of why they're selling.
•Accountability. When they hired you, you probably gave them a list or some idea of what you do to get the home sold. Don't let them assume you're doing everything. Tell them. When you email or call, let them know what activities you've done so they can see you're working. Since you're working and the home isn't selling, they will be less likely to blame you for it and more reasonable when you bring up the price.
•Use questions. Telling is not selling. Good selling is asking a series of questions to get the other person involved in the conversation. If all you're doing is calling them up and telling them what's happened and what they need to do, chances are they're not listening. Telling creates resistance. If you want them to see what's happening, they have to be educated on it. Asking questions gets them involved.

Here's the process.

•Email over in advance the information. Or, if face to face, take it with you.
•Make sure it's easy to read so they can follow along.
•Start off with their motivation.
•Once you ask the questions, shut up! Let them answer, no matter how long it takes.

You'll need the following information (already typed up for them to see)

•How many days has the home already been on the market?
•How many showings have we had?
•How many offers have there been?
•How many similar homes actually sold since you've been listed?

Now let's put it all together

"Hi Mr. Seller, it's Ilona with XYZ Realty, how are you? I'm calling about your home for sale, is this a good time? Great, do you have the information I emailed over handy? If not, can you grab it. Perfect. Now just to double check, you and your wife still need to move to _________ and you'd still like to be there by ____________, correct? Great. Let's review the information.

Based on what I sent you, how many days have we already been on the market? 75.....That's right. And in those 75 days, how many showings have we had? 5....Exactly. And of those 5 showings, how many offers did we receive? 0.....OUCH! No offers! Now Mr. Seller, how many similar homes actually SOLD since we've been listed? 5....Right. And looking at those properties, were their prices higher or lower than your current price? Lower. Exactly. So based on this, what do you think the market/buyers is/are telling us about your price? I guess it's too high. Right. So what price do you think we should use to get you on this SOLD list?"

It's important to let them tell you the price because then it becomes their idea. They usually won't argue with themselves. Now, if their price suggestion is too high...have them refer back to the SOLDS and ask, based on what we've seen is that price really going to get the job done? Go back over it until you've got them in agreement. If they won't agree, no problem, same exercise in 2 weeks! They'll get it eventually.

For more help with this, email me. I have some additional scripts.

Friday, August 6, 2010

"I don't want to give my house away!"

Ever heard that from a seller? It's one of the common objections we hear in today's market. Funny thing is, there's only one way to give your house away. That's to give it to the bank. Otherwise, what the seller is doing is simply pricing the property to sell in today's market.

Yet how do you convince the seller of that and remove the emotion of the decision? Statistics are important. Asking questions is also key. Knowing their motivation and options is another way.

One method I have found to be very helpful is to always approach the seller from a position of contribution rather than desperation. Then present them with the options they have. There are really only 3 or 4 options they can choose. Show them what they are and based on their motivation have them pick one. It doesn't really matter which one they pick, it's their choice. Hopefully with the right statistics and education from the agent they will pick the one that makes the best sense.

So here are the options:

1. Give the house back to the bank.

2. Stay put. If they are solely price motivated, how many years will it take for them to get their price? In my market it's about 7 years before prices will be higher than they are today. That's based on today's stats. So, can they stay for 7 more years? What will it cost for them to stay that long.

3. Price it right and get it sold today. Most of the time, when you calculate what you're asking them to drop the price today and what it will cost to stay and wait it out, the price drop today will be less or the same. So I ask - "Since it seems either way it will cost you _________ amount, the question is do you want to do it slowly or get it over with?" Usually they want to get it over with.

I also remind them if they are re-investing, they will really not lose anything. See, they are simply transferring their investment from one house to another. Eventually the market will appreciate and they will make money. I ask them - "When the market returns and prices go up, do you want to be in this house or the new one?" Guess again which they choose.

Another great point is that it is nearly impossible to under sell a home today. Imagine the following scenario. You have a listing that realistically will sell in today's market for around $250,000. That's fair market value. What would happen if you listed it at $225,000? Would you get multiple offers? Sure. What happens when multiple offers occur? Buyers get so emotionally charged about the property they start bidding higher for it. At the end of the bidding, where will you likely end up? Close to or at the $250,000 price. So you see, buyers won't allow the home to be "given away" in most cases.

Let's also remind ourselves that market value is defined as - What a buyer is willing to pay and a seller is willing to sell for on an open market. I like to add to that definition in today's times - what a lender is willing to lend on it. I'm finding a few cases where the buyer is willing to pay higher than the appraiser thinks it's worth, thus driving the price down again to keep the deal together.

For more objection handlers on pricing, contact me.

Monday, August 2, 2010

Is it time for an Intervention?

In today's real estate market we have to work very differently than we did 5 years ago. That word called "work" has come into question. Are you really "working" as efficiently as you could or should be? Are you getting the results you want?

As a real estate coach I see the challenges agents face first hand. Sometimes it's important to have an Intervention to get them back on track. Take a look at these questions and if you need help with YOUR answers, feel free to contact me.

1. Based on your plan/goal, how many properties should you have closed so far this year?

2. How many have you actually closed?

3. Do you have any leads right now that you are 90% or more sure they will sign a contract this month?

4. What specifically is stopping you from being on track?

5. Is it time to change the goal for the year or with hard work do you think you can still make it?

6. What will happen when you get back on track and earn the money you need to? How will that change your current situation?

7. What is your commitment level to getting your business back on track?

8. Since this will be difficult, are you prepared to do what it will take to make it happen?

9. If you had a clear plan to get there, would you be willing to do it at all cost?

10. If you decide not to follow the plan, will you achieve the goal? How will that impact your life?

If you'd like the plan, let me know!