Many people believe that buyers are closed when they find the home of their dreams, but there’s a lot more to it than that. As a Realtor, you need to know exactly how to close buyers: have a strategy and don’t depend on luck. Real estate expert Jim Droz recently hosted a webinar on how to close buyers effectively and efficiently, sharing where to find buyers and how to move the process along seamlessly. Here are some common questions about how to close buyers that were answered during the webinar.
First and foremost, how much of your business should come from buyers? Jim states that 25 percent of your business should come from buyers, and 75 percent from listings. Why not focus solely on listings? Because with buyers you’re still making 50 percent of the commission check, there’s a possibility of working a double ended transaction, buyers become sellers, they generate referrals, and their successful purchase can be used in your marketing efforts and thereby create more listing opportunities.
Where Do I Find Them?
Buyers can come from listings, your “people bank” (people you’ve worked with in the past), marketing efforts, your reputation and image, unplanned opportunities, and the internet.
The majority of buyers—92 percent in fact—are using the internet to look for a home these days. This is great as a Realtor because you can harness this incredible resource to reach more people in a lot less time. Finding buyers via the internet will also brand you as the expert as opposed to a salesperson, will partially eliminate the chase, and will provide you with a better quality client.
Despite the many perks, it’s important to remember that only 4 percent of internet prospects will buy or sell immediately, that 90 percent of interested parties will buy in six to nine months, and that most consumers won’t decide on an agent until after six to seven contacts.
As we’ve stressed in previous articles, the best way to ensure you capture an internet buyer is to respond immediately: 90 percent of contacts hire the first agent to respond, and the percentage of quality leads drops drastically from a response time of two minutes to 24 hours.
How Do I Secure Their Business?
Once you have your buyer leads from various sources, your first order of business is to get those buyers into your office or schedule an appointment at their home. Jim suggests using a service like Constant Contact for pre-appointment questionnaires, this way you have a better idea of what the buyer wants before you meet with him/her for the first time.
Next, come prepared to your first appointment with your buyer presentation and ready to qualify what type of property meets the buyer’s needs. If the buyer isn’t prequalified, make sure to obtain the necessary credit information in order to run a credit report. Once you have the buyer’s financial information, you can determine what they can afford. Make sure to take the buyer’s gross monthly income, any long-term debts, the lender ratio, and the lender limit on housing expenses into consideration before setting a price range.
How Do I Determine Which Properties to Show?
Now that you have contractually confirmed the buyer as a client and have a set price range, it’s time to determine which properties to show. First, provide your clients with a home and property qualifier worksheet. This will allow the buyer to fill in information like the preferred location of the home, community type, lot size, terrain, architectural style, and landscaping style. The worksheet should also include a breakdown of the features of the home and what the buyer must have, would like, and wants to avoid in each room.
By this point, you should know your client’s motivation for buying: will this home be used as a primary residence or as an investment property? Keep this in mind as you move forward with the process.
Continue to narrow down the search by showing your clients photos and virtual tours of available properties. Next, conduct on-site showings of appropriate homes, making sure to sell the neighborhood first and qualify the property type second. Remember: don’t show every property on the market! Only show properties that are “your buyer appropriate.”
How Do I Know It’s the Right Home?
Your job as a buyer’s agent is to be a matchmaker. Know what properties are the best bargains, listen to what your client wants, focus on location and make the match! Write a quality offer and leave the transaction with satisfied clients and money in your pocket.
This entire process should take you three appointments and five hours: two hours for the qualifying appointment, two hours for the first property showing appointment, and one hour for the last property showing appointment. If the transaction has not closed after these three appointments, take advantage of the internet by using it to send your clients information on homes that meet their specifications. However, don’t rely solely on the internet; continue to follow up with them via phone and in person for additional showings.
I’ve Closed the Deal. I’m Done Now, Right?
Not so fast! Closing a buyer is an opportunity to market your success and reel in more listings. Door-knock the neighborhood from which your buyer came and the one he/she is moving into. Send out mailers telling those in the area “My Buyer Just Bought;” these will allow you to showcase your local expertise and commitment to exceptional service. You can also post a sign in the buyers’ new front yard stating that you were the agent that helped them find their new home.
Lastly, plug your recently closed buyer client into your referral system for future business opportunities and check in with them periodically to see how they like their new home.
Congratulations, you’ve successfully closed another buyer!