As an agent, you’re job isn’t done – and you don’t get paid – until the transaction has closed. There are a variety of roadblocks that can prevent a closing. Some you can’t control (buyer loses a job, etc.), and some you can. For a smoother road to closing, ensure that you’re doing these 4 things at the start.
1. Provide an accurate comparative market analysis
Homes sell because of 3 major factors: neighborhood, price point and condition. You can only affect the price point. Doing an accurate market analysis results in pricing a house to sell quickly. When you show your client their home’s competitive price, you’re less likely to have to deal with a price drop down the road. Plus, you won’t waste valuable time and effort trying to sell a home that’s overpriced:
- Know sold prices. Place a heavier weight on the price of homes that have actually sold.
- Have an unbiased perspective. View the property as if you’re a picky buyer: look for things that would be a turn-off to buyers.
- Be honest. In the end, your client will appreciate candor. It’s possible to be likeable and still be honest with your client about their home’s true value.
- Do your homework. Be prepared to explain the price range you’ve proposed.
- Defend the pricing strategy. Communicate the consequences of overpricing (missing potential buyers, lack of showings/offers, time wasted, lack of competing offers). Research shows that in real estate, pricing at or below the market value actually stirs up more interest (and often results in a higher sale price).
Did you give great service? It’s ok to ask for the referral.
2. Explain the home buying and selling process
A well-informed client is less likely to become frustrated by the process. While it’s “old hat” to you, the process of buying and selling is an unknown to first-time buyers and sellers. For repeat clients, it’s wise not to assume they remember all the steps and things to expect along the way.
- MLS. Show how listings work, when they post and if you’re syndicating to other sites.
- Showings. How they work, what’s expected and how to prepare their homes.
- Explain communication. Let your client’s know how and when you will be communicating with them. Redefy agents also explain how Contract Managers step in and handle the steps to closing.
- Offers and negotiations. Explain how they work and everyone’s role in the process.
- Under Contract. Explain what this means and what happens after it happens.
- Inspections & appraisals. Explain the process, cost and ramifications.
3. Be upfront about the costs of buying and selling
Don’t assume your client knows the costs and understands the lingo.
- Settlement Statement. Give a sample of a settlement statement and explain the breakdown of costs. You’ll certainly make looking over that sheet a whole less stressful for your clients at closing.
- Listing Agent commission. For a traditional agent, this could be up to 3 percent (or more) depending on the state. For a Redefy agent, the seller pays just $2,500 (instead of the standard percentage) – $300 Listing Deposit and $2,200 (represented on the settlement statement) due when the property closes.
- Buyer’s agent commission. This could be up to 3 percent or more depending on state as well.
- Inspections and expenses. Be sure that buyers and sellers understand who pays for what, and what they’re obligated to do.
- Title and closing costs. These numbers will no doubt be a bit of a shock to first-timers. Explain what they are (and why they’re required) and that they will vary depending on where the property is located.
- Appraisal. Explain that this is the buyer’s cost (and whether it’s paid up front or rolled into the loan). Give them a range of costs.
4. Communicate the ups and downs of real estate
Explain that ups and downs are part of the buying and selling process. There will no doubt be some unforeseen challenges, so it’s important to prepare your client mentally up front.
- Personal ups and downs. This is quite possibly the largest transaction your client will ever make. Add to that the emotional attachment of homes. It’s a stressful time for your client! Financial strains and delays caused by life events could also happen. Let them know that you’re going to be there for them through the whole process.
- Real estate ups and downs. It ain’t over til it’s over. All kinds of issues can come up along the way that are out of anyone’s control. Let your client know that you try to anticipate possible issues, but there could be something totally new or unexpected that happens. It’s not to dissuade them from the process, but to empower them to handle any hiccups along the way. Being up front about possible roadblocks is a level of honesty that brings trust in your ability to handle whatever comes up.
Clients hire you because you are the professional that will guide them through a complex real estate transaction. Preparing them ahead of time is a level of customer service that will be remembered and appreciated. Ultimately, that gets you paid at the closing table and sets you up for positive referrals.
Ongoing training is an important part of Redefy agent success. Find out why our agents, on average, are making nearly twice* the annual salary of traditional agents.
*national average source: National Association of Realtors
By Susha Roberts and Carrie Aversano, Redefy Real Estate