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Breakthrough Ideas for Greater Real Estate Success!
In this issue...
  • How Top Producers Ask For Price Reductions
  • Get Your Buyers To Bring You More Business
  • QuickTip: Sell Homes Fast By Telling the Truth
  • How To Get Referrals By Becoming a “Door-Mat” Agent
  • Horror Story: When “Free Time” Costs You Money

How Top Producers Ask For Price Reductions

Would you like to know the painless, 4-step process to get price reductions and sell your listings in record time?

Well, take just a couple minutes to review the steps (and sample scripts) on how to have a successful price reduction meeting with your seller-clients.

The best time to “set-up” a price reduction is when you take the listing (you already knew that, right?).  But if for some reason you've taken an overpriced listing and need to get a reduction, you can use this process to correct the situation – and save yourself months of carrying expenses.

Here's how to do it step-by-step...

4-Steps To A Successful Price Reduction Meeting...

Your price reduction meeting with sellers will be similar to your original listing presentation, except you now have accurate, historic information about the seller's home.  In my program Superstar Closing Secrets™ I give you a “cheat sheet” for this important meeting with questions and responses to establish control.

STEP 1:  Present an Updated Market Analysis
Before the price reduction meeting, you'll need to prepare an analysis similar to your original CMA (or “Maximum Home Value Audit™”).  During the meeting, compare your seller's home with all of the other listings, pendings, and sales in the area.

Analyze other statistics such as average time on the market, price ranges, list price to sales price reduction percentage, and the percentage or number of listed homes sold during the same period as the seller's listing.  After presenting the market analysis, ask your clients 2 questions:

Question 1.  Do You Have Any Questions Regarding The Market In Your Area?  You're trying to confirm that they agree with your market analysis.  If they have questions, answer them directly, then ask:

Question 2.  Do You Agree That The Home is Priced Above The Market At This Time?  You're not asking them to lower their price here.  You're asking them to confirm that their home is overpriced.  You'll be asking them to reduce price shortly.  Once they see for themselves the home is overpriced, go to the next step...

STEP 2:  Present Your Completed List of Marketing Tasks
Go through your original marketing plan, and discuss every action you've taken to market their home.  Explain the impact or exposure of each action on generating prospective buyers.

You can also explain the historic impact each task has had on selling other homes you've listed, or homes sold in the area.  Your objective is to reinforce the seller's confidence in your ability to market their home.  At this point you want to ask another 2 questions:

Question 3.  Do You Feel That Your Home Is Being Marketed Properly Up To This Point?  If they say "yes", go on to the next section.  If they say "no", you need to ask this question:

Question 4.  What Areas Do You Feel Need Improvement In Marketing Your Home?  You want to ascertain their expectations about your marketing activities at this point.

Some sellers value open houses, others want to see more agent showings -- everyone makes their own expectations, logical or not.  Listen carefully here.  You can adjust your marketing plan to better fit their expectations if it's warranted.  Nevertheless, the sale issue will always come back to pricing the home -- the seller's responsibility.

After the sellers finish sharing their thoughts on the marketing of their home you can move on to the feedback you've received...

STEP 3:  Present Feedback and Areas For Improvement
Take out the comments you have from touring agents, showings, and open houses.  Review the comments relating to price and showing condition of the home.

These comments are very important because they are honest, third-party opinions about their home.  Sellers may get a little upset at this point, but it's important they hear feedback that will better motivate them to sell their home.  At this point, you want to ask the following question:

Question 5.  Do You Agree With The Comments From These People?  You want to make sure they acknowledge the comments made about their home.

If some of the comments made require physical improvements to the home, you need to open that discussion and start making plans for improvements.  But, don't get the issue confused -- there's still a price issue to be discussed...

STEP 4:  Ask For The Price Reduction
The first thing you want to tell sellers at this point is you're doing everything possible to promote the home, as shown from the activity and marketing plan.  Second, tell them that your efforts will be fruitless unless "we" adjust the price to get closer to buyers expectations.  Then tell them the following:

Mr. and Mrs. seller, your property will remain unsold as long as we continue to price it at $_________.  Pretty soon other agents will cross it off their show list because they know it's priced too high, and they won't want to waste their time.  Before this happens, we need to reduce the price.   I recommend we reduce the price about ___%  to be more in line with the market.

IMPORTANT TIP:  Notice I used a percentage, not a dollar figure?  Percentages are more relevant and palatable when making adjustments.  Clients will probably want to know how much that means in dollars, and you should tell them, but present it first as a percentage.

Then ask the following question:

Question 6.  Is This Price Acceptable to You?  They'll probably say "no", and give you a price that's a small reduction from their current price.  If they do, say the following:

The formula here is really quite simple: The greater your price adjustment, the faster your home will sell (and for the most money possible).  The lesser your adjustment, the longer it will sit on the marketThen, remind them of their motivation:  Have you finalized your plans to move yet?  (or)  Have you made any decisions on your next home?  (or)  When do you have to qualify for your next home, and is your loan approval dependent on selling this home?

At this point, they'll either say "OK", or they'll have common objections.  Remember, objections are just unanswered questions revisited.  Handle each objection keeping in mind that seller's have many emotional attachments to their homes, which can compromise their rationality.

And one final thing...don't forget to complete and sign the agreements for the price adjustment AHEAD OF TIME.  Keep the “price” field empty, but complete the rest of the agreement.  You'd be surprised how many agents forget at the end of this long (but now much easier!) process.

[Ed note:  If you'd like proven answers to price-reduction objections, learn more about our new program Superstar Closing Secrets™ by clicking here...]

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Share Your Best STUFF!

Real estate can be a tough, lonely business. Even top agents need a continuous flow of guidance, support and new ideas to keep going strong. When you share your best stuff with our community, everyone wins!

AND…remember, each month we hold a drawing to award one amazing FLIP video camcorder to an agent who submits an idea we use. So submit your best prospecting, marketing, horror story, or other real estate idea that makes you more successful, and you'll automatically become eligible to WIN a BRAND NEW FLIP video camcorder. Be sure to include an example if you have one! Click Here

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Get Your Buyers To Bring You More Business

Here's something beneficially DIFFERENT that will bring you more business after selling a home to Buyers.  It's called a “Testimonial Just Sold Card” and agent Marcia Holcomb has perfected this prospecting strategy.

If you remember, you build momentum in your real estate practice by LEVERAGING off your existing activity to get more listings and buyers (as explained in full detail in Step 2 of the 3-Steps System).

Marcia does THREE important things whenever she closes a transaction with Buyers:  1) gets a quick testimonial explaining how she helped her clients, 2) puts the client's testimonial on a post card, and 3) sends these post cards out to the surrounding area to announce the new neighbors.

The important thing to notice is how the cards highlight her superior service from the mouths of her clients.  Never forget...what OTHERS say about you is 10,000 times more valuable than what you say about yourself.  Marcia knows this well and let's her ecstatic clients do the selling.

Here's Marcia's brief description and example Just Sold card...

“Instead of sending out the 'typical' Just Sold cards...when I do a closing on a home, I use testimonials from the sellers and send it to all their neighbors.  My clients enjoy doing this for me...and it gets my name out there while letting the neighborhood know that there will be new folks in town.  The welcome baskets start coming, everyone meets, and I get more business.”

Just Sold Card example

QuickTip: Sell Homes Fast By Telling the Truth

“At a recent listing presentation, I got TWO listings from the same seller by explaining the true market situation.  Other agents were trying to convince the seller they could get higher offers on their homes.  I showed the owner that even though I was listing their homes for less they would make more by a fast sale.  This made sense to the sellers.  So I beat out other agents and got both listings.”

How To Get Referrals By Becoming a “Door-Mat” Agent

“Unlike most of us, I want to get walked on as a REALTOR®.  Let me explain how I use a 'welcome mat' to buyers to continue to get referrals for years.  For every home buyer, I follow the same three steps once the transaction closes...

Step 1:  I purchase a nice welcome mat for the front door that says WELCOME in big, bold letters.  It's something most people won't purchase for themselves right away.  And you can usually get one for under $20.

Welcome mat

Step 2:  I wrap up the mat with a bow and a greeting card that says:

greeting card

Step 3:  I put a few business cards in the envelope with the greeting card and deliver it in person.  This face-to-face delivery is very important.

I've written three contracts for family members of one buyer alone...and this person proudly 'steps' on me every time she comes home.”

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Horror Story: When “Free Time” Costs You Money

“A couple I know came to my office one day a year after they started looking at homes and said they were ready again to look at homes they could purchase.

They told me another real estate agent wouldn't show them any homes until they got pre-approved.  I carefully told them the reason for that was to make sure he didn't waste their time or his time looking at homes that didn't fit their criteria and price range.

I said that was a good idea but that I did things a little bit differently when I had a little extra time, because I like to dream a little bit with my clients...even if they haven't been to a lender yet.  Little did I know what I was about to get into...

I told them I'd show them only one or two homes and then we would definitely need to get them to a lender to see what they could afford, otherwise, they'd be wasting their time too – and I didn't want them to do that!

They were sure what they could afford and found the home of their dreams.  They told me to write up an offer on their dream home, one that was over $300,000, and I asked them several times, 'Are you sure you're comfortable with that high of a monthly house payment?'  Both of them said 'YES'.  So, I began the process of writing up the offer but had to wait until the next day to go with them to the lender.  Has this happened to you before?

The lender who told them that there were 30 pages in their credit report that they needed to work on for the next two months in order for them to receive a loan from her in SIX months.

Now, I knew from the start that this was going to be a learning experience for both them and myself, and it was definitely challenging, but a couple of days after they met with the lender, they called me and told me they were going to buy the $180,000 home they were living in, from their landlord, and 'could you help us with it?'  (They couldn't get a loan yet anyway, so I don't know why they thought they could still get one with a lower price right now.)

What a nightmare.  I had told the listing agent on the first home that I was bringing him an offer and then had to tell him I wasn't bringing an offer, which didn't reflect well on me.  And now these buyers wanted me to do it again with another home.

One of the lessons I learned from this is not to tell a listing agent you have an offer until you actually have the signed offer in your hands (with proper financing).  The other lesson is that even though I have some 'free' time, it is not always best to use it 'freely', even if you know your client will be learning a valuable lesson.  It's best just to call the lender, right then and there, to see what amount they will be pre-approved for BEFORE spending my gas money on a trip around the countryside.”

Issue #1158