Author Archives: Gary Elwood
Author Archives: Gary Elwood
Somewhere on the East coast, towards the Canadian border, a homeowner calls an agent for a price on her home. The agent evaluates the home and gives the seller a price. The seller wants to sell her home but thinks the price is too low. The agent, needing the listing, allows the seller to talk her into listing it too high.
Six months later, even after minor price reductions, it expires.
A second agent takes it, beats the homeowner up on price and finally sells it for what the original agent had told the seller in the first place.
Three thousand miles away on the East coast, an agent’s client wondered if she cared about their listing when it expired. They said she didn’t make a big pitch to keep it active. The agent explained that the house was unfinished, over-priced and as a result everyone’s time was being wasted. On that advice, the homeowner finished the interior, reduced the price and within a few weeks there was action—and a legitimate offer on the home.
Another agent in Chicago explains “Once you determine that the seller is unreasonable and overpriced fire them before they fire you. A cancelled listing is easier to explain and you will feel better walking away.”
Dump a potential commission check in a cut-throat business like real estate? Have real estate agents gone bananas?
No, not quite.
In the interest of exploring this topic further, not long ago I decided to find out if overpriced homes are the leading cause of expired homes. I polled 406 real estate agents from across the country and asked them eleven questions. The question that this article will deal with was “What do you think is the number one reason a homes expires? Why?”
The response confirmed my hunch (and will probably confirm your hunch too): plain and simple, three-hundred and sixty-nine agents said a home expires because it is overpriced.
Equally interesting answers that made up the balance of the survey, and would prove entertaining and a mistake not to share with you at this point, are as follow.
I commonly saw this thread throughout the results: an agent does not ask for a long enough listing. The length of the listing is important. A short listing, say 2 months, could prove fatal. I agree.
Another answer that cropped up occasionally was the “agent lacks skill to properly educate the consumer about market times and handle the consumer’s objections.”
The lack of skills and courage to speak up could make a huge difference. That’s why proper skills in sales and negotiations is critical to your success as a real estate agent.
Another answer that I saw quite a bit was communication—lack of communication to be more precise. Most agents agreed that expireds (in fact, all things real estate) can usually be fixed with consistent open dialogue with the client from the beginning.
Like one agent said, “Too many agents avoid the client in order to avoid the inevitable…an expired listing.” Bottom line, failing to communicate with the seller spells trouble.
The condition of the home also proved to be a fairly popular reason why a home expires. Poor advertising, no advertising, procrastination, lack of dedication to the listing and low-self agent esteem will also kill a sale.
One Sound Strategy to Deal with Overpriced Homes
So, what are you to do when faced with a seller who wants to list at a high price?
A lot of real estate agents said, “Don’t take the listing unless it’s priced right from the start.”
This is a sound strategy. In fact, many agreed that accepting an overpriced listing begins with the agent: your first job is to educate the seller on the market so the seller can have a realistic expectation of the market—and you can get control of the seller, bringing their expectations back to reality.
But there was an equal share who didn’t have a problem accepting an overpriced listing. What these agents had in common was a solid 3-step process for controlling the seller and her expectations.
Here the steps that they used:
1. Get a commitment from the sellers to lower the price within 14-30 days of listing if no offers have come in.
2. Get the commitment from sellers to do the things required to give the home its maximum market appeal (cosmetics).
3. Adjust price on a schedule.
These 3-steps can be built into the contract, providing an important opportunity for you to explain the importance of scheduling price reductions during the listing presentation.
You could say:
“We aren’t going to automatically do price reductions, unless your home doesn’t sell by a specific time. And the reason we want to do it this way is because we want to protect your home from any stigma that will build if it sits on the market for too long. You probably already know this, but when a house with a sign in the yard sits for 60 days or longer people start to think that there is something wrong with it—termites, foundation cracks or overpriced—which hurts your chances of selling the home, and may even suck in bottom feeders who know you are anxious to sell your home. And you don’t want to sell your home to bottom feeders, do you? No, I didn’t think so. We don’t want that to happen to your house.”
Using these three steps could give you shock-proof protection from the harmful affects of listing an overpriced home, namely, protecting you from a listing expiring.
What are your thoughts on expired listings? Accepting over priced homes? Scheduled price reductions? Do you agree or disagree?
Disqualifying buyers? Is this common wisdom turned on it’s head?
You bet it is.
See, some leads that you generate don’t have the appropriate DNA (desire, need, ability).
If leads are just kicking tires, move on. If they’re looking for a house for their Aunt Mimmie who’s moving here in thirty years, move on. If you just don’t feel good about them, move on.
They’re just going to waste your time.
That’s why it’s so important that while prospecting, you need to politely identify if a lead has the right DNA. In essence, your challenge is to disqualify them as rapidly as possible using questions.
It’s the old 80/20 rule. It’s the reason the vast majority of salespeople produce a FRACTION of what top performers on the very same sales teams produce.
When you generate 100, 200 or even 300 or more buyer or seller leads a month you must thin the herd.
For instance, as your prospect base rises, you will see a diminished level of quality. But as your prospect base lowers, you’ll see a rise in the level of service you can provide. And you will also see more transactions as a result.
Imagine if you were working with 50 prospects this month. If that’s the case, then you’ll fill up your days helping those 50 prospects. Each one of those 50 prospect gets a very small sliver of your time.
This has become known as Parkinson’s Law.
Now, if you were working with 25, you would fill up your time helping them. Now, each prospect would get twice as much attention from you, which naturally means better service.
The end result: you’ll be able to develop a closer, more trusting relationship with each prospect. And the likelihood is high that those who you gave up were high-maintenance and demanding, a dangerous combination when time is scarce.
I think you’ll agree: most professional real estate agents are afraid to give up prospects. But if you focus on your highest quality prospects and devote 90% of your time serving them then you’ll reward yourself with a consistently growing business.
Got any horror stories of working with the wrong clients? Please share your story!
Networking is fundamental to the real estate business.
Here’s a rapid fire list that will help you feel like the magnetic center of any room…without having to resort to a wardrobe malfunction…
1. Dance in your pajamas. Before the party, burn nervous energy by exercising or dancing.
2. Get into an irresistable state of mind. On your way to the party, visualize your most recent accomplishment–snagging two listings in one weekend, opening a new community center for children. Set your mood so that you are relaxed, energized and radiating confidence.
3. Look cool, but act warm. Dress sophisticated, but treat everyone like your favorite cousin.
4. Instead of an opening line, try a compliment. “Hey, I love that tie. I was wondering where you bought it.”
5. Talk food. Or football. Men appreciate a woman who knows her sports and women admire a man who likes to cook. Point: talk to people’s interest, not yours.
6. Be the only one at the party not drinking. By mid-evening you’ll seem intelligent and poised.
7. Schmooze with integrity. 3 musts: eye contact, responses that show you are listening and a genuine smile.
8. Break personal space rules. Invite warmth and friendliness by standing a little closer. Pulling away suggests you are aloof and would rather be somewhere else.
9. Grab something and pass it. Whether it’s a tray of appetizers or drinks, passing something out will give you a reason to approach someone and also give you a way out: “Oops, got to keep going.”
10. Speak up. Be the first to toast the host for a wonderful party.
11. Put your soul out there. Confess embarrassment. Risk self-exposure. Tell a joke, even if you are really bad at it. When people see the real you, off-the-charts charm follows.
Have a great tip you’d like to share? Please, share it with us in the comment section!
First, what is copywriting?
In a nutshell, copywriting is nothing more than salesmanship in print. In fact, a good sales letter, website or mailer is just like having a salesperson on your team. But with one critical difference. Let me explain…
Salespeople are trained to sell or promote to one customer at a time. However, one well-written, highly-persuasive sales letter can sell to 1,000 people (or more)…at anytime of the day…in the time it takes a salesperson to sell to 10 people.
For example, if you send 1,000 postcards, 1,000 people will probably see it in a day. That’s why it’s important for you to have a persuasive message on your mailers or website. You will promote more in less time.
Now, I’ve shared one very good reason why copywriting is important. Here are seven more. And after reading each, you’ll get a better feel for copywriting. You’ll understand what it can do for you. And you’ll see why you or your team may want to invest time or money in copywriting to help your business grow to the next level.
1. Creates Selling Power. The most obvious reason why copywriting is important is this. It creates a force that will generate that lucrative, heart-pumping “I must have this or do this” buying response in customers. Result…leads triple, appointments double, commissions increase.
2. Creates a Conversation. Great copywriting is a conversation between you and your customers. And a good mailer is the perfect way to break that ice.
But it doesn’t start with you. It starts with your prospect. It speaks to him. Where he is. His hopes, dreams, fears and desires. It makes the customer feel like you have the right answer.
3. Melts Sales Resistance. Good copy will appear transparent to the reader. It will not draw attention to itself. In fact, great copy will lead the reader to think that it was his own idea to call you.
4. Boosts Response. Before launching into writing a mailer or ad, research the prospect. Probe potential and past customers. Perhaps spend some time studying human behavior in general. Your goal? Understand people’s deepest desires, fears, hopes and dreams. And when you can convince readers that you will be their answer to these desires, fears, hopes and dreams…response rises.
5. Builds Profits. A successful agent has a healthy dose of leads, transactions and profits constantly flowing. Copywriting can help you do that, too. Copywriting is the fastest and most economical (I’ll explain why it’s economical in a few paragraphs) way to propel profits in your business.
6. Improves Search Engine Rank: Great online copy does double duty. It not only knows exactly how to push a reader’s hot buttons. It not only knows how to trigger an emotional response like “Christ, my money is doomed if I don’t do something about it now!” Great copywriters know what search engines like Google are looking for. Which will help you open a floodgate of free traffic to your website.
7. Slashes Marketing Costs. It’s extremely easy to judge whether a direct response piece of copy is performing or not.
According to John Kennedy, legendary copywriter for Lord & Thomas (the world’s largest ad agency in the early 20th century), “Advertising should be judged only by the good it is conclusively known to sell, at a given cost.”
Copywriting is easy to measure. To judge. To replace if it’s way under-performing. To leave well alone if it’s pulling its weight. To test if you think it has untapped potential. And then you can strike oil in places you never expected.
Now wouldn’t it be great if your sellers were a fly on the wall and heard with their own ears what was going on during a showing?
Better yet, why not have the sellers involved in the showing, just like in that television program Designed to Sell?
Have you seen how they do this in Designed to Sell?
It’s an ideal way—albeit sometimes painful—to show the seller via a hidden camera (their “fly on the wall”) what buyers think of their home. Usually on Designed to Sell the motivated sellers are very receptive to what they hear and go with the recommendations.
This is because the buyer paints for the seller the exact picture that the market sees of their home. The trick, as you may know, is to offer this picture in such a way that sellers don’t bite the messenger. (Designed to Sell does it with a hidden camera.) Sharing negative feedback can be an unpleasant, if not painful, job. Now there’s an easy and automatic way to share feedback without getting bit. (And free.)
When the seller sees comments like “…the garage door is smashed up. Fix it, and I might put in an offer…” or “…worn carpet throughout. Looks terrible. Replace it and I’ll consider…” and when these comments aren’t coming from you but from the mouth of buyer’s who have shown their home, it’s likely sellers will rethink their price. The condition of the home. Or perhaps their terms.
And so they lower the price. The home is in better alignment with market demand. And it sells. Fast.
The cumulative effect is often a brisk and steady up tic in homes sold.
And isn’t it true the faster you can sell homes, the faster you can collect a commission check?
Many young, inexperienced reps who are fearful of rejection, as well as older and experienced pros who get burned out or are too comfortable, tend to commit selling suicide.
To discover if you are pushing away your own sales success, take this quiz:
1. When you are touring a home of a prospective seller do you pretend the house has no flaws?
If so, you will suffer a Death by Perfection. This kills credibility. Don’t hide negatives. Like the legendary negotiator Herb Cohen says “Great salespeople expose the flaws and deal with the issues immediately.”
2. After a house sits on the market for 30 days, do you say to the seller “If this marketing strategy doesn’t work, well…we’ll just try something else”?
If so, expext to experience Death by Doubt. Confidence sells. Lack of confidence in the house, marketing approach or self kills deals cold. Sounding wishy-washy undermines peoples confidence in you.
3. When presenting the buyer’s counter offer to the seller do you tell them the counter offer first or last?
If you tell them the counter offer first, then you are likely to be a victim of Death by Information. In this case, if you believe in the counter offer, build value for the offer before you present it.
4. Do you abbreviate your full listing presentation when a seller says that he has only fifteen minutes?
If so, you will end up Dead by Deadline. Not telling or selling the whole story puts enormous pressure on you. And if the deal doesn’t die but you end up getting the listing, you may end up compromising a ton… like your commission. Always give a full presentation and allow enough time to respond to questions and negotiate.
At this moment, there are 4 good reasons to work foreclosures.
First, there is an abundance of foreclosures.
Second, working foreclosures adds to your toolkit of buyer services.
Third, working foreclosures at pre-foreclosures stage helps out a struggling human being—the seller who is on the brink of defaulting on his loan.
Fourth, there is very little competition.
Most agents view foreclosures as junk prospects, but when RealtyTrac released some numbers on Tuesday, June 12, 2007, relating to foreclosures, all I could see was leads aplenty.
As the Good Books says: the fields are white for harvest but there are so few laborers.
According to its data, RealtyTrac said, more than 176,000 people got foreclosure notices in May, an increase of 90 percent since the same month one year ago and the highest figure ever recorded in their monthly report.
90 percent. That’s scary. But also an excellent opportunity for you to help another human being save credit, equity or face. Rewarding in itself, of course…but you’ll make a few thousand for your time, too.
Now, the first step in working this niche is finding the best ways to locate foreclosures. Bandit signs, courthouses, banks, other real estate agents and loss mitigation specialists are all good sources.
One of the best places to find foreclosures, however, is by subscribing to an online foreclosure and pre-foreclosure service.
After you’ve located them, your next step is to contact the foreclosure.
In addition to pursuing foreclosures, you could also establish some ads that would bring the foreclosures to you. There may be a higher cost, but the quality will be supreme, because these people are looking for help and have sought you out. The following message, on a flier, in the Classified section or in a homes magazine would be sufficient and to the point:
Don’t lose your home to foreclosure.
Learn your options. Preserve your credit.
For a Free Recorded Message 24 Hours a Day
Enter Extension #XXXX
Let me know in the comments if I missed something that isn’t covered by one of these resources. Happy reading!
Only one tool can sway buyers.
It can make you persuasive beyond what you thought was possible…put people in total confidence with you…broaden your sphere of influence so fence sitters in this market will see what you recommend as the right thing. And they will act that instant.
That tool is emotion.
Famed real estate trainer Tom Hopkins once said, “You are in the emotion-building business.”
That is, you’re not selling houses—you’re selling swing sets, fireplaces, backyards, school districts, swimming pools, kitchens and Jacuzzis.
It’s the order taker who says, “Do you like this house? Would you like to put an offer on it?”
But it’s the emotional-conscious salesperson who says, “Mary, I can really tell that you like the fenced-in backyard…you would feel comfortable letting your children play for hours back there, wouldn’t you?”
When she says, “Yes,” you’ve just sold a backyard. The house just happens to go with it.
I wrote about emotions and buyers a couple of months ago and my favorite tip was the call to urgency.
For instance, pointing out that interest rates are rising will push emotional buttons that cause people to cringe at the thought of spending more money than they’d like…or even worse, losing money.
Jeff Tucker in the Agent Inner Circle forum suggested another positive way to close the deal:
“Once we wrote up the ‘Offer to Purchase’ contract I submitted it to the listing agent with a cover letter. I took a photo of the young couple and imported it to MS Word and pasted it on the cover letter with their names under the photo. My cover letter described the couple and why they wanted the seller’s home to be their home. I brought the logical transaction to an emotional point of view.”
On the buyer side of this, take a photograph of the buyer in front of every house you visit with them. Then, when they are sitting on the fence about a particular home, pull that picture out and remind them of how they felt when they stood proud in front of that home.
Another great way to use emotion is simply to maintain an enthusiastic tone—even during tense situations.
When under pressure and buyer’s are confused and indecisive, it’s easy to slip and get frustrated. The moment you do that, however, and introduce a negative emotion, your buyers will back away.
But maintain composure and say, “That’s a good topic. I’m glad you brought it up. Let’s talk about that…” and your buyer’s will see you as a strong pillar in a difficult storm, which creates feelings of awe and loyalty to what you ultimately say.
And one final word of caution: use emotion sparingly. Like former Hilton CEO David Michaels says, “Emotion is a valuable too—if you don’t over use it.”
I don’t know how you feel about approaching strangers, but I can tell you how I feel…
It’s uncomfortable, if not sometimes downright unnerving.
You’ve got eight seconds to grab your prospects attention. You hear the silence.
What do you say?
In situations like these, I like to use these three opening lines…or at least some variation of them.
And by the way, you have to memorize and practice these so they trigger automatically.
Good or bad, your opening line will immediately establish an impression. It sets the tone for the call.
If you open things up the right way prospects will love you. If you don’t…they will despise you.
So it needs to be automatic.
Here are three good openers for face-to-face cold calls. Plus one bonus tip:
1. “Can you help me?” or “I need your help.”
This is by far the best way to begin a conversation. People love to help and don’t feel on guard against a salesperson. Remember, the object is to get the prospect to listen.
“Can you help me?” almost commands the other person to pay attention.
2. “I would like to mail you a listing presentation/package. Who should I send it to?”
This is known as indirect qualification and puts the gatekeeper at ease. All you’re asking for is a name, and all you’re doing is leaving something—then you say good-bye.
3. An Introduction. Usually, when a prospect picks up a direct line, they say their name: “This is Robert Smith,” or “Robert Smith speaking.”
Your first step will be to repeat this person’s name. Keep things formal for now—use Mr. or Ms., then the contact’s last name.
Prospect: This is Robert Smith.
You: Mr. Smith?
You: It’s a pleasure to speak to you.
Get the idea? This pleasantry will do a far better job for you than simply volunteering your name and company affiliation at the outset of the conversation.
Bonus Tip: Once you’ve shared your hook, the other person knows the reason for your call—the cat’s out of the bag. This is the perfect time to identify yourself and, if you like, your organization.
So, which question are you going to use on your prospecting calls today?
Think it takes willpower, energy and sacrifice to be successful in real estate?
So did I. But you know what? I was wrong.
About four years ago I was talking to Bob Corcoran of Corcoran Consulting when he said something that really struck a chord with me me and totally changed my way of thinking about real estate: “There are only 4 activities in real estate that will make money for an agent: prospecting slash marketing, negotiating, listing and selling. Everything else is minimum wage.”
He went on to say that for an agent to be truly successful…to become a top producer…and to stay there…he or she must focus sharply on those 4 activities.
In my experience I’ve learned that when I talk to someone like Bob, someone who in the last fourteen years has consulted with a star-studded list of some of the biggest top producers in the world, including the #1 Coldwell Banker agent worldwide, to really listen carefully because what they’re saying is worth a pot of gold.
The Art and Science of Real Estate Marketing
And that’s exactly why I created our In The Zone series four years ago: to help you with smart, efficient ways to sharpen your marketing, build your inventory, take you to the top…and keep you there.
In that time I’ve shared with you:
All tips that will help you make more money in real estate. Without having to fight tooth-and-nail to earn it.
But earlier this year I started feeling like something was missing. Like I owed you more.
Then, I decided it was time to take it a step further: I wanted to share with you an idea, tip or technique in one of the four pillars every week, every day, heck, maybe even every other hour.
Clients and subscribers who are in the trenches listing and selling real estate on the front line have told me that In the Zone is a valuable training tool–for themselves and their office.
But why should they have to wait a month for new training ideas? Why not empower them to succeed immediately?
So that’s my goal with our Real Estate Marketing Blog. To share with you steps, strategies and guidelines that focus sharply on those 4 activities…and help you to wisely market yourself so that you are working less but earning more and living without the weight of business worries on your shoulders.
And no ivory tower, impractical fluff.
Just hard-hitting, easy, profit-rich marketing ideas three or four times a week. If not more.
So go ahead… subscribe today and join us as we uncover the super-successful real estate marketing ideas that you need to exceed your business and lifestyle goals.