1. THE BUYER & THE PROPERTY SHOWING CHAPTER 9

2. OFFICE MANAGEMENT The goal of the office is to capture all calls and turn them into leads. To capture means to obtain three major pieces of information: Name Phone number Why he/she is calling

3. There are two basic ways an office captures phone calls: 1. Floor time 2. Receptionist No one ever buys a home over the phone. So don’t try to sell property over the phone.

4. FLOOR TIME The following are some general rules about dealing with telephone inquiries from prospective buyers: 1. Obtain the caller’s name and telephone number. The agent setting floor time will only capture about 40% of the phone calls. 2. Get more information than you give. 3. Find out or discover what the prospective buyer is interested in.

5. RECEPTIONIST Many offices today hire a receptionist, who will capture about 90% of the phone calls. 1. The receptionist cannot answer any legal real estate questions. His or her job is to get the name and phone number. 2. The receptionist will have a list of agent and call them in order. The agent will then get the name and phone number from the receptionist and call the prospective client.

6. When talking to the client, hold the details — give more information than was in the ad. Close on an appointment. The choice given should be what time, and set the place for the meeting. There are only two places for an initial meeting with a potential buyer: 1. At your office (preferred) 2. At the prospective buyer’s home (only if the prospect can’t possibly come to your office)

7. Ask “people-oriented questions.” Which of the following questions is a people-oriented question? 1. How many bedrooms do you need in the home? 2. Why do you feel that you need a three-bedroom home? (people-oriented question).

8. “ I can arrange to show this lovely home as well as another home that I think will interest you and [Mr./Mrs.] Jones at 5 pm today, or would 6 pm be more convenient for you?” This will help to reduce the “no-shows.” Never indicate you have another property if you don’t have one.

9. If you can’t make an appointment, then try to e-mail them a picture of the listing and pertinent details. Also ask, “are you interested in being alerted to new listings and having first chance, before the property is advertised?”

10. THE MEETING Your Safety Unfortunately, personal safety has become an issue in recent years. Some female agents have been attacked by “prospective buyers.” To reduce the likelihood of jeopardizing your personal safety, meet prospective buyers at your office whenever possible.

11. If the client will not meet you in the office, consider taking another agent with you to the meeting.

12. First Impressions When you meet with prospective buyers, make a mental point of remembering their names. By repeating their last name several times to yourself and thinking of people you know with the same first names, you are less likely to have to ask the buyers their names when writing an offer to purchase.

13. Make certain you are pronouncing names correctly. If you are uncertain, ask. People like to be addressed by their names, so use them frequently during the discussions. Explain that you will be able to save the prospective buyers a great deal of time by spending just a few minutes to decide what they really need in a home.

14. BUYER’S INFORMATION First Name Last City__________________ State______ Zip _________ Phone work______________ Home________________ E-Mail___________________ House type____________ Price Range_____________ Location. _____________ Sq. Footage______________ Use a buyer’s worksheet and obtain the following information:

15. Bedrooms Bathrooms Fireplace Laundry Parking Backyard Pool View School Needs

16. THE QUALIFYING PROCESS Before showing property, if you can, get the clients pre-qualified. Some agents pre-qualify the client themselves by using a qualification form so they won’t forget the information prospective buyers give them. The use of a form also reduces the chances of forgetting to obtain some needed information.

18. Front-end qualification ratio (FE): using the following chart, you can find the maximum monthly amount buyers could spend for house payments (PITI) at a variety of gross annual income (GI) levels using a 28 percent ratio. FE = PITI ÷ GI

19. Example: The buyer has a gross income of $150,000. His front end ratio is 28%, then he must earn: $150,000 x 0.28 ÷ 12 = $3,500 per month

20. 4,667 200,000 3,500 150,000 3,033 130,000 2,333 100,000 2,100 90,000 1,867 80,000 1,633 70,000 1,400 60,000 1,167 50,000 Monthly Mortgage Payment Gross Annual Income

21. Back-end qualification ratio (BE): might be 36 percent, which means that a person’s total housing expense (PITI) plus long-term debt (D) obligations cannot exceed 36 percent of gross income. BE = (PITI + D) ÷ GI

22. Example: The buyer has a gross income of $150,000. His front end ratio is 36%, then he must earn: $150,000 x 0.36 ÷ 12 = $4,500 per month

23. 6,000 200,000 4,500 150,000 3,900 130,000 3,000 100,000 2,700 90,000 2,400 80,000 2,100 70,000 1,800 60,000 1,500 50,000 Monthly Mortgage Payment Gross Annual Income

24. PREPARING THE BUYER During the financial qualification process you need to discuss financing and the down payment. Before you show property, you should discuss earnest money. Earnest money deposits are made with offers. Prospective buyers should understand that their check will be held uncashed until their offer is accepted.

25. “ If we are fortunate and find the perfect home for you today, would you be able to make a deposit of [$ ] with your offer?”

26. Buyers should understand that three things can happen when they make an offer. 1. Acceptance means that the buyer has purchased a home. 2. A counteroffer from the owners gives the buyers the opportunity to accept it, or make their own counter to the counteroffer or reject it. 3. Rejection of the offer means the entire earnest money deposit is returned to the offerors.

27. THE SHOWING Preparing To Show To show property to prospective buyers, you must make adequate preparation.

28. SHOWING TECHNIQUES Sell the Neighborhood. Plan your route to sell the neighborhood.

29. Create a Favorable Ambiance. It is interesting to note that although some buyers are interested in construction and utility, most are attracted by color, glamour, texture and style.

30. RULES OF PROFESSIONAL CONDUCT The following rules will help you maintain goodwill and a professional manner as you plan for and conduct showings: If you arrive at a property and notice that someone else is showing it, wait inconspicuously until the other salesperson and his or her clients have left.

31. When showing a home, leave it as you found it. If drapes were closed, see that they’re closed when you leave. If inner doors were closed, close them when you leave. Double-check all outside doors to see that they’re locked. Be sure to replace the key in the lockbox where you found it. If dogs, cats or other animals are confined to a given room, yard, garage and so forth, see that they do not gain access to other rooms or to the street.

32. Notify the listing office immediately if something seems to be amiss at a property you have shown. Treat all listings as you would want to have your own listing treated. If a listing specifies “Call first,” never take a customer to the door and ask to show the home. If, while showing a property, you decide to show another and cannot reach a telephone, leave the client in the car while you go to the door and ask the owner for belated permission to show the property. Then abide by the owner’s wishes.

33. If a listing indicates that the property is to be shown only during certain hours or gives other information regarding particular conditions of showing, do not violate these requests. There must be a reason for them. Leave your business card at each property. It is a courtesy to the owner (whether at home or not). It also helps to advertise your own office. It is a good idea to write the date and the time on the back of the card.

34. Interoffice courtesy requires that when calling another agency for information, you immediately identify yourself and your company. Do not enter a house with a lighted cigarette, pipe or cigar, and do not light one while in a house.

35. Avoid making uncomplimentary remarks about a house, its condition or its furnishings while in the house. The owner may be in the next room and be embarrassed or hurt by your comments.

36. KEEP THEM YOURS After you have completed your first session of showing homes to prospective buyers, it is a good idea to ask them to return to the office to discuss the properties they have seen. If a closing is not going to be possible, consider a way to tie up the prospects so they regard you as their agent.

37. OBTAINING THE OFFER A favorite definition of salesmanship is the “four P’s”: P ersuade people to P urchase P roperty for a P rofit. P ersuade people that nearly everyone is a customer at some time or benefits from home ownership. P urchasing property for live–in purposes or for investment is a decision everyone faces.

38. When purchasing, two things should happen: 1. If the experience is pleasurable for the buyer, he or she will be your best prospect for future sales as well as leads. 2. If the sale is a pleasurable experience for the salesperson, it will encourage increased efforts for future sales.

39. SELLING IS EFFECTIVE COMMUNICATION Without effective communication, there is no understanding. Know what you want to say; use listeners’ language. Do not use fancy words when simple ones will do. Use the “KISS” method ( K eep I t S imple and S incere).

41. SELLING IS DISCOVERING Help your client or customer to discover. Evaluate your inquiry style: 1. Do my questions tell my prospect that I understand him or her? 2. Do I ask property-oriented (fact-finding) questions? 3. Do I follow this with people oriented (feeling- finding) questions? 4. Do I ask open–end questions to get the other party to “open up?”

42. If you start with fact-finding questions, which appeal to reason, you accomplish three things: 1. You relax the prospect. 2. You indicate to the prospect that you have done your homework. 3. You obtain valuable information that helps guide your sales effort.

43. Then revert to feeling–finding questions, which appeal to emotions.

44. SELLING IS KNOWING YOUR PRODUCT If you are going to satisfy needs and wants, you must know what properties are available and their features. Taking a listing, preparing for a showing, going through the multiple–listing service (MLS) listings and networking with others are all good opportunities for gathering this information. Knowledge and expertise are becoming even more important as consumers become more sophisticated.

45. GETTING HELP Many agents use a personal assistant to help with all the paper work. They are considered employees, therefore, they are salaried. You need to provide them with worker’s compensation insurance.

46. They can be either a licensee or non–licensee. Some licensees are not sales oriented, but are interested in working in real estate industry. They can handle all the paper work. Some agents do NOT like to sell or work with people. A non-licensee can only do secretarial or paper work, and they cannot do any tasks that requires a real estate license.

47. In six months to a year an agent should be producing at least two sales per month or about $400,000 × 0.015 = $6,000 × 2 = $12,000 per month. That would be about $144,000 per year. In producing that kind of money, you will discover that the paper work and following all the transactions is very time consuming. You will need help.

48. Most agents want to spend their time listing or selling. It is much easier to hire someone to do the paper work.