As promised in yesterday’s blog, When is Your Client Really Your Client? – Important Questions to Ask Prospective Buyers, today’s posting is devoted to your clients, the sellers. Following are some key questions to consider when you are meeting with prospective sellers which will help insure your success and aid you in determining whether or not these are clients you really want. As stated previously, interviewing the client is as important to you and your business as interviewing multiple agents is for sellers. (Sellers, see Finding the Right Agent to List Your Home for key points of consideration in that decision-making process.)
These suggestions are not necessarily to be taken in chronological order. Use your best judgment in determining how to best to employ them:
· Establish whether or not you are interviewing in competition for the sellers’ listing. It’s okay to ask who the other agents are and which brokerages are represented. Of course, the seller need not tell you. Information is power, and anything you can find out about the competition can only strengthen your position. If you are in competition, ask to present your comparative market analysis either first or last. Making a strong impression first might eliminate the competition. Being strong and last may tip the balance in your favor.
· Schedule a pre-list walkthrough and take copious notes. A seller’s enthusiasm for their home does not always translate to equivalent marketability. Furthermore, I find I am most successful when I believe in the product, as it were. A tasteful, well appointed and cared for home is typically easier to market and advertise than one where a lacking in pride of ownership is evident.
· Ask the seller to tour you through the home, pointing out its finer features; essentially anything you can showcase in your marketing to separate it from its competition or make its story more compelling to tell. “Silent talkers” are a great tool for accentuating them once the listing is active.
· Have the sellers determined what they believe to be market value? If so, what is the source or basis for their thinking? This is hugely important. It is rare that sellers do not compare their homes to others sold recently in the neighborhood, or base pricing on conversations with friends, neighbors, family members, often anyone but a qualified real estate professional. Their assessment may be subjectively favorable, occasionally optimistic or possibly unrealistic.
· What are their needs? A seller who is “testing” the market may not be as motivated to be flexible on price as one who needs to relocate to a new city within sixty days. Furthermore, knowing their needs and expectations will help you determine whether or not they really are ready to list the property. Someone who has lived in a house for forty years may be slower to commit to listing than a party whose made an investment and is ready to buy up to the next level or turn the house for a quick profit.
· If a relocation is occurring, then where to? A seller moving from a less expensive market to a hotter, pricier one might be factoring their “need for a price” into their thinking in order to offset the expense of the relocation, typically an unrealistic expectation. Is there a corporate relocation company involved in any way? Though the service can be valuable, it can also impact your commission significantly through compulsory referral fees.
· Determine what their payoff amount is. In a market where sub-prime loan delinquencies are increasing, knowing if the seller is about to be upside down is crucial. Once a bank becomes involved or foreclosure proceedings are initiated, the complexion of the transaction (and how much you stand to earn) may be affected dramatically. I believe everyone deserves great representation. It’s incumbent upon you, the agent, to determine whether or not you are best suited to this kind of transaction. Short sales can be very stressful for all involved and fraught with surprises.
· Determine what their expectations are concerning your marketing. Do they want you to do regular open houses? Is yours a neighborhood where agent tours, brokers’ and public open houses are effective and well attended? What kind of advertising do they anticipate? Make certain of one thing; that you deliver on whatever marketing campaign you promise and promote as part of your business.
· Are they indeed the legal owners and rightful sellers of the property? Will anyone else be involved in the decision-making process? This is common with elderly sellers who, though they may be rightful owners, are relying on their children to make key decisions for them. Estates can involve many parties, often times at odds with one another.
· And, when it comes to time to discuss commission, only you and/or your broker can determine what your best business practice is. I adhere to strict rules in mine regardless of whether or not I’m in competition. Commission is something I chose not to negotiate. I find doing so helps me determine if the client and I are on the same page and well suited to one another. But, it is not for me to preach or promote appropriate commission structures outside of my own business.
The more you know about the client, the more likely you are to feel good about taking the listing or walking away. Either way, information is power and empowering. It’s okay to say “no”. Doing so simply makes room for clients better suited to your style and ethic.