revised edition an agent’s guide to creating urgency to buy buyers’ market = right time to buy...
TRANSCRIPT
REVISED EDITION
An Agent’s Guide toCreating Urgency to Buy
Buyers’ Market = Right Time to Buy
Breakthrough to Mastery
2An Agent’s Guide to Creating Urgency to Buy
Main Ideas
1. Perspective on Buyer Urgency
2. Prequalify Buyers: Are they Able, Ready, and Willing?
3. Become the Local Economist of Choice
4. Help Buyers Tap Into Their Why
5. Address Buyer Reluctance
6. The Bottom Line
3An Agent’s Guide to Creating Urgency to Buy
Perspective on Buyer Urgency
The Challenge» The media creates misconceptions about
buying homes today.» Buyers fear paying too much.» Buyers don’t have any sense of urgency.» Many agents think it is not a good time to buy.
Page 7
4An Agent’s Guide to Creating Urgency to Buy
Perspective on Buyer Urgency (continued)
The Truth» People are buying and selling homes in this
market.» No one can truly “time the market.”
Page 8
5An Agent’s Guide to Creating Urgency to Buy
Perspective on Buyer Urgency (continued)
The Solution» Prequalify buyers» Work with buyers who are able, ready, and
willing» Become the local economist of choice» Help buyers tap into their why» Address buyer reluctance
Page 12
6An Agent’s Guide to Creating Urgency to Buy
Prequalify Buyers
Able—do they qualify for a loan? Ready—what are their reasons for buying? Willing—what are the market expectations?
Page 13
7An Agent’s Guide to Creating Urgency to Buy
Prequalify Buyers (continued)
Common Reasons for Buying» Relocation» Dissatisfaction» Life changes» Second home» Home sold» Lease ending» Investment
Page 15
8An Agent’s Guide to Creating Urgency to Buy
Prequalify Buyers (continued)
Ask and Listen» Dig deeper with great questions» Listen carefully» Take notes
Page 16
9An Agent’s Guide to Creating Urgency to Buy
Prequalify Buyers (continued)
Determine Willingness» Ask …
“Do you want to risk missing a house that is perfect for you because you’re waiting for a sliver of savings that may or may not be there?”
Page 17
10An Agent’s Guide to Creating Urgency to Buy
Prequalify Buyers (continued)
Impact Their Urgency» Three Tactics
1. Become the local economist of choice
2. Help buyers tap into their why
3. Address buyer reluctance
Page 17
11An Agent’s Guide to Creating Urgency to Buy
Prequalify Buyers (continued)
Able, Ready, and Willing?
What questions will you ask to determine if your buyer is able, ready, and willing?
Page 18
12An Agent’s Guide to Creating Urgency to Buy
Invest Time in Research
Page 19
Top Dollar-Productive Activities
1. Lead Generation
2. Lead Follow-Up
3. Appointments with Prospects
4. Negotiating Contracts
5. Market Research
Be the Local Economist of Choice
13An Agent’s Guide to Creating Urgency to Buy
The Tale of Two Markets
Page 20
In the Market
Out of theMarket
Great PoorCondition vs.
Comps
Above
Below
Pri
ce v
s.
Com
ps
Be the Local Economist of Choice (cont)
14An Agent’s Guide to Creating Urgency to Buy
The Tale of Two Markets: Sellers’ Market
Page 21
Great PoorCondition vs.
Comps
Above
Below
Pri
ce v
s.
Com
ps
In the Market
Out of theMarket
Be the Local Economist of Choice (cont)
15An Agent’s Guide to Creating Urgency to Buy
The Tale of Two Markets: Buyers’ Market
Page 22
Great PoorCondition vs.
Comps
Above
Below
Pri
ce v
s.
Com
ps
In the Market
Out of theMarket
Be the Local Economist of Choice (cont)
16An Agent’s Guide to Creating Urgency to Buy
Good Time to BuyReasons to Buy Now
1. Mortgage interest rates are low and stable
2. Home prices have become more affordable
3. Inventory is high
4. Strong economy
5. Low unemployment
Page 24
Be the Local Economist of Choice (cont)
17An Agent’s Guide to Creating Urgency to Buy
Mortgage interest rates are low and stable.
Page 26
Source: Freddie Mac
6.4%
0%
4%
8%
12%
16%
20%
1971
1973
1975
1977
1979
1981
1983
1985
1987
1989
1991
1993
1995
1997
1999
2001
2003
2005
2007
Mortgage Interest Rates 1971 – 200730 Year, Fixed-Rate Mortgage
Be the Local Economist of Choice (cont)
18An Agent’s Guide to Creating Urgency to Buy
Home prices have become more affordable.
Page 27
3%
0%
4%
8%
12%
16%
1976 Q1
1978 Q3
1981 Q1
1983 Q3
1986 Q1
1988 Q3
1991 Q1
1993 Q3
1996 Q1
1998 Q3
2001 Q1
2003 Q3
2006 Q1
Source: OFHEO
U. S. Home Price Index 1976 – 2007Year-to-Year Change
Be the Local Economist of Choice (cont)
19An Agent’s Guide to Creating Urgency to Buy
Inventory is high.
Page 28
Source: National Association of Realtors
Supply and Demand Shifts 1989 – 2007
10.2
4.4
0
2
4
6
8
10
12
198
9
199
0
199
1
199
2
199
3
199
4
199
5
199
6
199
7
199
8
199
9
200
0
200
1
200
2
200
3
200
4
200
5
200
6
200
7
0
1
2
3
4
5
6
7
Mon
ths M
illions
Existing Home Sales
Housing Inventory
BuyersMarket
SellersMarket
Be the Local Economist of Choice (cont)
20An Agent’s Guide to Creating Urgency to Buy
Be the Local Economist of Choice (cont)
Becoming the Expert
What tools do you use to communicate your knowledge of the economy and local market?
Where can you get reference information you need?
Page 30
21An Agent’s Guide to Creating Urgency to Buy
Help Buyers Tap Into Their Why
Features vs. Benefits» Features—amenities
• Fireplace• Pool• Large master bedroom
» Benefits—affect emotions• Quiet• Cozy• Spacious
Pages 31-32
22An Agent’s Guide to Creating Urgency to Buy
Help Buyers Tap Into Their Why (cont)
Advantages of Home Ownership» Build equity» Tax break» Investment
Page 32
23An Agent’s Guide to Creating Urgency to Buy
Cost of Waiting to Buy» Delay of tax benefit» Delay of building equity in new home» Need to view more homes» Selection of best homes is limited» Market will shift and great buys will be
gone
Page 33
Help Buyers Tap Into Their Why (cont)
24An Agent’s Guide to Creating Urgency to Buy
Help Buyers Tap Into Their Why (cont)
Buyers Who Want a Deal» Learn their definition of deal» Communicate the consequences of some
“deals”
Page 35
25An Agent’s Guide to Creating Urgency to Buy
Remove Fears» Fear of paying too much
• CMA• Appraisal
» Fear of making a commitment• Option period• Buyback guarantee
Pages 36-37
Help Buyers Tap Into Their Why (cont)
26An Agent’s Guide to Creating Urgency to Buy
Incentives and Concessions» Improvement allowances (carpet, paint)» Pay early move-out on renter’s lease» Pay mortgage on buyer’s home for a period of time» Pay buyer closing costs» Lease-purchase options» Mortgage buydowns» Seller financing» Extras (electronics, car)
Page 38
Help Buyers Tap Into Their Why (cont)
27An Agent’s Guide to Creating Urgency to Buy
Help Buyers Tap Into Their Why (cont)
Close“Is this a house you want to buy?”
“Good houses sell fast in any market.”
“How would you feel if someone else bought this house tomorrow?”
“If you love this house, someone else will too.”
Page 39
28An Agent’s Guide to Creating Urgency to Buy
Help Buyers Tap Into Their Why (cont)
Helping Buyers Tap Into Their Why
What will you say to remind buyers of their wants and needs?
Page 40
29An Agent’s Guide to Creating Urgency to Buy
Address Buyer Reluctance
Four Strategies to Overcome Buyer Reluctance1. Why wait?
2. Trade up
3. Less is more
4. Find a best buy
Page 40
30An Agent’s Guide to Creating Urgency to Buy
Address Buyer Reluctance (continued)
1. Why wait?—the hazards of timing the market
Home Price
Starting Price $200,000
5% Drop $190,000
10% Drop $180,000
Interest Rate
Starting Rate 6.0%
.5% Jump 6.5%
1% Jump 7.0%
Payment $1,199 $1,201 $1,198
Drop in home price is offset by increase in interest rate.
Page 41
31An Agent’s Guide to Creating Urgency to Buy
Address Buyer Reluctance (continued)
2. Trade up—the opportunity of a down market
Original Home
Starting Price
$200,000
5% Drop in Home Prices
Sell at $190,000
Loss of $10,000
New Home
Starting Price
$400,000
5% Drop in Home Prices
Sell at $380,000
Savings of $20,000
Lower sale price is offset by greater savings.
Page 43
32An Agent’s Guide to Creating Urgency to Buy
Address Buyer Reluctance (continued)
3. Less is More—Narrowing the Field1. Know what they need and want
2. Know the best buys in the market
“If you show buyers what they want, they’ll be motivated to buy.”
Steve Cohen
Boston, Massachusetts
Pages 44-46
33An Agent’s Guide to Creating Urgency to Buy
Know the InventoryReasons to Preview Homes
1. Save yourself time and gasoline
2. Take customers directly to the best buys
3. Buyers have confidence in you when you only show houses that meet their needs and wants
Page 46
Address Buyer Reluctance (continued)
34An Agent’s Guide to Creating Urgency to Buy
Address Buyer Reluctance (continued)
4. Find a Best Buy—Get While the Getting’s Good
Where to Find Best Buys1. REOs
2. HUD Exchange
3. Foreclosure lists
4. FSBOs
5. Price reductions in the MLS
6. New homes on the market
7. Builder’s promotions
Pages 48-49
35An Agent’s Guide to Creating Urgency to Buy
Address Buyer Reluctance (continued)
Create a List» Nominate homes that you consider “best buys”» Be on the lookout for special offers from
builders and other sellers» Create a short list of the best of the best
Page 49
36An Agent’s Guide to Creating Urgency to Buy
Address Buyer Reluctance (continued)
Do Your HomeworkTrack Your Best Buys1. Time on market
2. List price
3. Condition
4. Selling price
Page 49
37An Agent’s Guide to Creating Urgency to Buy
Address Buyer Reluctance (continued)
Use Your List» Don’t give the list out, offer access to the best buys.» Show houses on the list to your customers—these
are the houses that will sell fastest.
Page 50
38An Agent’s Guide to Creating Urgency to Buy
Address Buyer Reluctance (continued)
What strategies will you implement to address buyer reluctance?
Page 51
39An Agent’s Guide to Creating Urgency to Buy
The Bottom Line
Prequalify buyers Only work with buyers who are able, ready,
and willing Become the local economist of choice Help buyers tap into their why Address buyer reluctance
Page 52
40An Agent’s Guide to Creating Urgency to Buy
Productivity Boosters
Consult using buyer guides Apply action plans to stay in touch Use mass email with hyperlinks to your
website Use an IVR number and capture each caller
Page 53
41An Agent’s Guide to Creating Urgency to Buy
My Action Plan
Pages 59-61
Don’t put away this guide without developing a plan to put what you have learned into action!
Refer to the Action Plan on pages 59-61of the guide to assess your strengths and areas for improvement.
Write down steps you will take to improve your skills—complete it, share it, and commit to it!
42An Agent’s Guide to Creating Urgency to Buy
Take the other courses in the Breakthrough to Mastery Guide series! Gaining Mind over Market Upshifting Your Lead Generation Seller Pricing Strategies Seller Staging Strategies Lead Capture and Conversion Internet Lead Capture and Conversion Bulletproofing Transactions Expense Management Effective People Leverage Short Sales, Foreclosures, and REOs Financing Solutions
43An Agent’s Guide to Creating Urgency to Buy
Thanks for being here!
Please completean evaluation for this session.