How to Handle Objections in Real Estate

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In the prime of his career, Jim Droz was the most successful real estate agent in the world – grossing over a million dollars per year four years in a row. Since then, he has been a prolific speaker at conferences around the country and author of the book Releasing the Winner Within. He is also an advocate for the HouseHunt and TIM System. He hosts monthly webinars exclusively for HouseHunt agents. Here is just a bit of his insight from his most recent webinar! (To learn more about becoming a HouseHunt agent, submit your information in the form to the right.)

how to handle objections in real estate

Too many Realtors view objections from the client as a bad thing – a sort of confrontation. This is not at all what customers mean when they ask the hard questions, and viewing it was such will only damage your reputation. Instead of getting defensive, use every objection from a prospect as an opportunity to highlight the pros of your business and share your expertise.

There can be objections about anything. Disputes can range from home value to whether or not to use a ‘For Sale’ sign in the front yard. Here is a list of just about every possible real estate related objection and some appropriate responses from Realtor Mike Ferry. For objections specifically regarding home price, check out our friend Bill Gassett.

No matter the argument though, here is a step-by-step guide to how to handle objections in real estate:

  1. Let Them Talk. Don’t interrupt the buyer or seller while s/he is presenting his or her concerns. If you interrupt every time you think of a response, you will come across like you’re scrambling to play defense. Very unprofessional.
  2. Confirm Their Objection. Wait… this seems backwards, right? Believe it or not, the first thing you want to do after a concern is validate the client’s point of view. For example, “I understand this price seems low considering all the work you’ve done to it. The new landscaping will play a valuable role in curb appeal. You even installed hardwood floors which will be great for value. The last thing we want to do after all that effort is under-price your home.”
  3. Find the Reason Behind the Reason. Discuss the client’s concern more extensively, but listen for clues if there’s a real reason for the objection that isn’t quick to surface. In the example above, the client was concerned about underselling the house because he had put a lot of work into boosting the value. The work he’d put into the resale is a valid reason to be concerned. However, there’s also a chance that he’s been ripped off by another Realtor, or had lofty (though false) promises from other Realtors that he liked better. You can’t qualm the client’s fear until you find its roots!
  4. Highlight Your Expertise. If you truly believe in the systems you have in place, you can get your customers to believe in them, too! No matter what aspect of your business is in question by the customer, explain your reasoning behind it. Back that reasoning up with market analysis and personal experiences. By the time you’re done explaining your methods, the customer will buy into the vision. Furthermore, since you waited four whole steps before explaining your perspective, you don’t have to worry about making them feel attacked or inferior.
  5. Revisit the Original Concern. By the time you reach this step, you have already let the client fully explain his qualm, you’ve dug a little deeper to find the real issue, and you’ve explained why your method fits best in this circumstance. So by the time you address the original concern, it will seem nothing short of petty. For example, a seemingly underpriced home will seem irrelevant when you’ve explained the competitive market and how quickly you expect to move the property.
  6. Move Forward. Now that you’ve settled whatever the issue was with such grace, the client will be more likely to trust your discernment moving forward. Whether you were in the middle of a listing presentation or a purchase negotiation, you can now proceed with the utmost confidence. Even though this whole thing started with what seemed to be an argument, you’ve handled it in a way that actually boosted your reputation in the clients’ eyes.

Follow these six steps, and no objection will trump you. As a matter of fact, each question a customer has for you will actually boost your business and your confidence!


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Lead Follow Up Checkpoint

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You’re driving down the road and you come across a police checkpoint. What happens? You sit up straight, get those hands at ten and two, slow way down, and turn down the music. Even if you weren’t doing anything wrong, you start doing things a lot better when there’s a checkpoint.

Well today is your Lead Follow-Up Checkpoint!

Read through this post and follow the advice, and you’ll suddenly notice all of your lead follow up get a lot better!

People’s gut reaction when they aren’t getting the results they want in their leads is to blame the lead generation tool their using. This causes agents to jump from platform to platform, spending a lot of money on start-up costs, but never getting results. Their second instinct may be to blame the customers. Turns out blaming or pressuring customers isn’t going to make them want to buy or sell with you. Let this serve as a gut-check for you and you alone!

lead follow up checkpoint

1. Are You Cultivating Your Leads

‘Cultivate’ means to acquire and develop. You should have multiple buyers in every stage of your consumer pipeline. How many customers go there will depend on your own goals and the size of your business, but regardless, there should be people in every stage.

“I know if my business starts to slow, all I have to do is take a week to focus on new and old leads in my pipeline.” – Stephanie Kulp, HouseHunt Agent since 2001

2. What Are You Doing to Convert Them

You need to have a different answer to this question for every stage of your pipeline. The buyers who are far from a purchase just need occasional touches. The buyers who are actively looking for properties need aggressive marketing.

Do you have these clearly broken out? If you’re operating out of HouseHunt’s TIM system, it’s easy to organize every lead by groups to maximize lead conversion and ensure no one slips through the cracks.

3. How Can You Improve Your Lead Management?

Do you need to do an overhaul of your systems to get organized?

Is there a certain part of your pipeline that seems to fail to convert?

Constantly re-evaluate your systems to see what can be done for improved results. Have other agents analyze your lead management. Utilize everything from broker previews to conferences to learn from others in the business.

4. Are Any Leads Falling to the Wayside?

When you have a lead in your pipeline, it should stay there until you get a request from the prospect to be removed from your contact lists. Stay persistent in follow-up – even if follow-up is just occasional touches – until you have a valid answer from every lead.

 

There are no short cuts for good results; you get out what you put in. It takes discipline to turn those leads into sales. Also remember that most Internet leads are still at least three months from buying. Stick with your leads and you have a 100% guarantee that you’ll build a loyal clientele, a growing sphere of influence, predictable results, and a job well done!

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List to Last (+ Buy to Build)

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The mantra of the industry used to be ‘list to last.’ This meant that if you wanted to stay in business as a real estate agent, you needed to be primarily a listing agent. Listing agents were where the money was at, or so the argument goes. Today, it could be argued that the ‘list to last’ phrase is mostly outdated, and now agents can go with whichever aspect of the business they enjoy more.

Here at HouseHunt, we believe that you can make your business work by doing whatever you’re passionate about. That being said, we have a recommended business model for starting agents to help you figure out what works best for you. It takes into account the ‘list to last’ concept, while bearing in mind that to truly build your business, you’re going to need a decent percentage of buying clients.

Jim Droz, formerly the best-selling agent in the world and advocate for HouseHunt lead-generation services, recommends a 75/25 ratio for selling versus buying. Let’s take a look at why that ratio is important.

list to last

Pros of Selling

People make it sound like selling real estate is where the money is. Well the truth is, you get 50% of the commission check whether you’re selling or buying real estate. So it’s not that the money is in selling; it’s just that selling (often) requires less effort. You could make an argument that selling is where the quick money is at.

When you’re the listing agent as opposed to the buying agent, you don’t have to drive clients to house after house only to keep getting excuses for why this house isn’t a good fit. Once you’ve landed a listing interview, you don’t have to… okay, you rarely have to worry about the client flaking out. Let’s just say the adage ‘buyers are liars’ exists for a reason!

Pros of Buying

Even though buying clients will likely account for less of your business model, they should get just as much attention and focus as your selling clients.

Despite the fact that buying agents take more time and often make less commission for you as an agent, the long-term benefits they serve are imperative to your business. Your buying clients will likely come back as selling agents, and – more importantly – build your referral network.

Even though buyers get hated on in the industry, you’re still going to get 50% of the commission check at the end of the transaction. Buyers may be flakier or take more work, but they still make you money at the end of the day. Furthermore, a more balanced buyer/seller ratio can often mean dual agency, further increasing that paycheck!

Yet another benefit of buying clients is that each customer you successfully get in a home equals a testimony for you. Each positive testimony will build your reputation, boost your Internet presence (with Yelp and Google reviews, etc.), and serve as marketing material in the future. The value of a great testimony – from social media to your site to your business card – will always outweigh the extra work it took to get there.

Even if the mantra of ‘list to last’ is still true in today’s market, you’re going to have to ‘buy to build’ your business!

How you split up your buying versus listing ratio is up to you, but both will hold important roles in a growing small business.

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Get More Buyer and Seller Leads for Fall

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FSBO Listings

Summer is winding down. This means you can lay off the sunscreen, rotate the wardrobe, and finally be done with that awful Calvin Harris song. This also means real estate business slows down for a lot of us. In the autumn, it’s important for agents to tap into new sources for leads to keep up business momentum.

Here are a few suggestions about where to find customers that you may not have had to utilize during the busy months. These guarantee quality buyer and seller leads, as well as minimal competition for their attention!

For Sale by Owner Listings

These people put their home on the market at the beginning of the summer, knowing that was a busy time for real estate. What they didn’t know, however, was how fierce the market was at that time, or how much work went into maintaining a listing.

Now it’s September and these people just desperately want to sell their home. Look for any FSBO listings that were posted a couple months ago, and see which are still available. (It will be most of them.) Approach those sellers, explain what professional services and experience you have to offer, and see if they would be interested in listing with you.

Property Management

You’re a Realtor, not a landloard. And an investment property is a lot to take on. We get that.

That being said, property management is a natural fit for a lot of real estate professionals. It serves two primary functions for the purposes we’re discussing:

1)      It offers consistent income when the real estate side starts to suffer.

2)      It gives you insight to potential buyer leads.

The first point is pretty self explanatory, so we’ll just explore the later function. Most people only intend on renting for a limited time before they make a purchase. Often a family is new to an area so they want to rent month-by-month while they become acquainted with the town. Or a family simply wants to downsize to save money for a year or so before purchasing a permanent home.

If you aim to rent your property primarily to renters with future buying intentions, you can spend your time as their landlord developing trust and reputation so that you’ll be their default Realtor.

Reverse Mortgages

Reverse mortgages are a great way for fiscally-tight retirees to start pulling from the equity in their own home, often to downsize to something more affordable. No matter their reasoning, there’s a need for a Realtor in the process. You can easily pull town or county records to gather information about elderly who have lived in the same home for a considerable amount of time. Those may be good candidates with whom to begin farming.

1031 Exchange Buyers

Just like with reverse mortgages, potential 1031 Exchanges are easy to find with local housing data. This government exchange assistance is an often-overlooked niche market. People who have owned a property for an extended time may want to sell in order to maximize their tax advantages. And with a 1031 Exchange, the seller must buy another property within 6 months. This means you could score a seller lead and a buyer lead from a single client.

Some of these ideas are a little bit more elaborate than others, but they’re all sure to get you fresh buyer and seller leads for the fall. And they all come from niche markets that are often ignored by real estate professionals, meaning less competition for you.

What other markets are you sure to tap into this season? Let us know in the comments below.


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Intro to Personal Branding for Real Estate Agents

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Personal branding is important for real estate professionals because it ensures that when a person thinks about buying or selling a house, your name is the first to come to mind. Here are some of the benefits of strong personal branding:

  • Steady Client Pipeline
  • Valuable Partnerships
  • Proven Credibility
  • Higher Perceived Value
  • Leadership Opportunities
  • Recognition/Status

All of these things are even more important in the world of real estate, where an ad for your business is synonymous for an ad for you. Here we’ll talk about the most important aspects of turning your name into a brand.

personal branding for real estate agents

Define Your Brand

Before you start marketing yourself as a brand, you need to define exactly what you’re selling. Obviously you’re a real estate agent, but is there a niche market you’re going to target? Do you work exclusively in certain areas? There’s nothing wrong with having specified clientele. Think of it as the In n Out mentality – It’s good to only do one or two things, as long as you do those things exceptionally well.

Continuing with the definition of the brand, we need to think on a more “superficial” level. Do you have a snazzy logo, a catchy slogan, a clear color palette? Your branding will have to be just as defined as your business model in order to be recognizable to customers.

 

Make Yourself Useful

Once you’ve defined what your strengths are as a Realtor, let the world know about them! This is where your content marketing comes into play. In order to market yourself, you’ll need a website –ideally just Your Name dot com. Start a blog to share your knowledge on the industry. Everything from market reports, insider tips, buyer guides, and more will make your site helpful to consumers. Even if someone is years from moving, if you make your site a helpful resource to them, your name will be at the forefront of their mind when the time comes.

Don’t just brandish your knowledge on the Internet: Whatever you’re an expert on, work those topics into conversations. Have data that no other agent is likely to have, and make it a point to bring it up in your listing interviews. Conversations like these will turn potential clients into returning customers.

 

Stay Consistent

This part of personal branding for real estate agents doesn’t usually sound very fun. Realtors love change, always having a new project, evolving with the times, etc. However, in order to turn your name into a brand, you have to give your audience time to familiarize themselves with you. It could take many months with the same slogan before it starts to stick. It will take many signs, flyers, and billboards before people can see your logo and automatically know what it’s for.

Most importantly, it will take a few successful transactions within your niche market before you start to build a solid referral network.

 

All of these things take time, but they certainly take a lot longer without clearly defined personal branding. As a real estate agent, so much of what you do is marketing. Maximize the effectiveness of your marketing campaign with these personal branding tips!

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How to Boost your Business with Social Media [Infographic]

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It’s very important to know the right ways to grow your business. In this infographic we tell you how to boost your business with social media.

 

Real Estate and Social Media

 

The Tricks and Treats of Social Media

Haunt ’em down: Utilize Facebook and Twitter to find who’s looking for a realtor or a home.

Don’t Spook ’em Out: Avoid asking your potential clients to “like you,” tell them why and how they should.

Never be a Zombie: Be authentic and show off your personality! Don’t be afraid to post something fun and witty.

Don’t get Lost in the Fog: Ask questions and get their opinion. People enjoy interacting!

Tell ’em a Good Tale: Post videos and pictures to share your story.

Give ’em a Chilling Surprise: Engage your fans with contests. Everyone likes to win something!

 

The Most Utilized Networks Amongst Realtors

Facebook- 78%

Twitter: 48%

LinkedIn: 29%

WordPress: 15%

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Is Real Estate a Materialistic Job?

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We’ve already discussed on this blog how it takes money to make money in real estate, but does that lead to a materialistic job? Let’s we take a look at the resources most commonly used in the industry and whether they are superfluous items or necessary tools.

is real estate a materialistic job

Car

Real estate agents have become sort of notorious for their cars. They spend a couple grand per year on maintaining their car (which is a lot, even with tax write-offs). Even agents who work from home could spend hours per day in their car with broker previews, open houses, and meetings with prospects. On top of their heavy vehicle use, they have a reuptatioin for lavish cars to impress prospects. The stereotype has become that agents always have the nicest or newest cars.

Verdict: So is the nicest and newest car actually essential for agents? Yes and no. As long as the car is clean and customers don’t have to worry about screechy belts or faulty brakes, there isn’t usually a problem. With that in mind, a luxury client on the market for a multi-million dollar home is NOT going to want to crawl into your Scion. (I’m allowed to say that – I drive a Scion.) Yes, luxury buyers can sometimes be a bit snooty and superficial. If you don’t like it, you shouldn’t have gotten into luxury real estate.

Loophole: There is a recent trend in Realtor vehicles that provides a bit of a loophole to the nice car rule. With an ever-growing focus on sustainable lifestyles, many clients are immediately impressed when their agent drives an electric or hybrid vehicle. If you work with pretentious luxury buyers, you can get away with driving a Prius whereas you you may have noses turned up at other Toyota models.

Snazzy Marketing Material

On this blog, we’ve talked about all kinds of marketing tactics. Very often, they’re not the cheapest ideas. You/your business could sponsor a little league team, create professional videos, host holiday-themed community contests, etc. All of these ideas cost money!

Verdict: Yes, you need money to manage marketing. As a matter of fact, we recommend budgeting 12% of your income toward business expenses, predominantly marketing. There are plenty of free marketing strategies too, such as social media and content marketing. But the more creative methods will always attract ready-to-act buyers and sellers.

Technology

Technology plays a role in a lot of real estate. A tablet keeps you organized and demonstrates professionalism for strong first impressions. A smart phone keeps you efficient. A GPS (especially a car with a GPS installed) will keep you on course for showings and community exploration. It’s been seen time and time again – technology and real estate go hand in hand.

Verdict: This category is a bit like marketing material: you get out of it what you put in. You don’t necessarily need the latest whatever released from Apple, but it’s good to keep a pulse on gadgets and get your hands on the items that will boost your business. The job could get done with relatively minimal technology, but where’s the fun in that?

Wine and Dine

Agents are always taking their clients out to nice dinners. It makes sense: The dinner creates an aura of success that seems to ensure profit from a move with this agent. It also serves as a place to discuss business and marketing plans.

Verdict: This category is similar to the vehicle question. Some types of buyers will expect the fancy dinner if they’re going to take you seriously. But most buyers would probably rather connect over something else – a game of golf, a cup of coffee, or just a stroll through a community hotspot. A nice dinner is certainly a great gesture, but is not as necessary as many traditional agents still believe.

Conclusion

A lot of the topics here prove that the stereotype of agents needing the nicest and newest resources is true. But does that make real estate a materialistic profession? Aboslutely not. There may be some materialistic buyers and sellers on the market, but that doesn’t necessarily reflect on agents. All of these tools – from the car to the iPad – are necessary evils that empower the agent to produce better results for the consumer.

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5 Tips to Find the Right Broker Office

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Broker Office Interview

So you’ve decided to be a real estate agent. Congratulations! The most common next step is to find a brokerage office to work out of. Sure, you may have a home office, but the broker office has so many benefits: A workspace with others in the industry, automatic leads from customers who go into the office, a consistent brokerage company with whom you can develop a great relationship, and more!

 

But finding the right office can be tricky. If it’s not a good fit, you could burn out on the job fast.  This is especially true for first year agents, who usually only gross around $20,000 in their first year (although, believe it or not, that’s a really good pace for a very successful second year as an agent).

To make sure you find a broker office that fits your vision, here are some tips to remember while you’re interviewing around:

 

  1. Remember they need you more than you need them. Just because you need an office space doesn’t mean you should feel pressured to a certain one or jump at the first option you see. Without you, they don’t have a business. So walk into that interview with confidence!
  2. Feel out the turnover rate. Some offices may seem really eager to take you in. It may seem flattering, but there’s also a chance they can’t hold onto their agents and are desperate to fill spots.
  3. Review the policy manual before you sign paperwork. There are so many factors that can vary from agency to agency. From commission splits to exit policy (Yes, you need to be thinking about exit policy right away!), you need to cover all your bases before you start. Openly discuss any concerns or discrepencies you have.
  4. Learn the procedure for starting. Most offices will tell you you can start right after you complete training. So then ask when training would start and how long it takes.
  5. Don’t choose an office for surface level reasons. Too many agents pick their office based on things like proximity to home, personal connections, or a high commission split. Now, don’t get us wrong: It’d be great to have an office close to home where all your friends worked and you kept a lot of money. But none of those factors will be worthwhile if your office is poorly managed.

When you’re looking for a brokerage office, you’re not just concerned about a workplace – you’re starting a partnership. So use these tips to make sure you’re starting you new business on the right foot.  Let us know what you think is most important in an agency office in the comments below!


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Niche Market Series: Working with First Time Home Buyers

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If you’re interested in making first time home-owners your niche market in real estate, there are some things you need to know before promoting your specialty. Read on to learn what new home-buyers are looking for in a house and how to market to them.

working with first time home buyers

There are certain things you need to know if you plan on working with newbie home buyers. For example, did you know that FTHBs make up 39% of the market? Here are the basics for building a first-timer niche market:

Loans

There are a lot of loan programs available for First Time Home Buyers. You will want to be familiar with all of the ones available in your area. Also be prepared for your client to be unfamiliar with many of the basic home loan programs including fixed-rate and adjustable rate, VA loans, FHA loans, and others.

To find more about the loans available to first time buyers, you can check the Department of Housing and Urban Developmentwebsite and plug in your location. Know the pros and cons of various options and remind the clients that just because they are first time buyers does not necessarily mean a FTHB option is the best way to go.

Taxes

There are tax deductions only homeowners can take advantage of, so make sure your clients are aware of these. This will be a major selling point for many young folks! Some of these perks include mortgage interest deductions, property tax deductions, and capital gains exclusion. In fact, if your clients are selling their home to move into a retirement community, they may not have to pay taxes on the sale provided they lived there for longer than five years.

Homes

73% of first time buyers are looking for a single-family home. This makes sense since a majority of this category of buyers are young married couples, likely looking to start a family in the not-too-distant future. The remaining first time buyers are looking for these types of houses: 9% seek a townhome, 8% seek a condo, and the remaining buyers are looking for unconventional homes.

Negotiations

One advantage of first time home buyers is that they are often very flexible in a lot of their negotiations. They know that their first home, although a huge investment, will not be their last real estate transaction. They are more likely to view it as an investment than a permenant asset in their life. As long as you help them feel comfortbale through the home-buying process, they’re more likely to be content and open to your suggestions.

Marketing

First time buyers do as much research online before even reaching out to a Realtor. This is arguably the most important client base when it comes to the marketing methods we advocate for here at HouseHunt. Social media is hugely important to this kind of buyer. Content marketing will make you easier to find on Google, which is likely where this buyer will start his/her home search.

Resources

There are many resources that can help you in your journey to working with first time home buyers your niche market. A great place to start is our Definitive Guide for First Time Home-Buyers. Remember a lot of people try to market specifically towards first timers, but with the proper education and references, you can set yourself apart from the pack!

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