Selling California Real Estate
I love this market! My last market as a top agent was the Southern California real estate depression of 1990 through 1996. It made me rich and set my family up for generations. Let me share the first eight of the silver linings to be found in tough markets.
1. If you would start setting up some pro-active seller lead generation systems, you would find that getting listings is easier. Sellers want professionals to sell their homes, and non-professionals seldom make it through a market like this. Sellers look less at discounted real estate services to solve their needs. You will find it takes less energy to capture a good listing. As you increase you personal inventory, you can increase showings, contracts from cooperative agents, buyer phone calls, and more double-end possibilities. I challenge you to start one new seller lead generation system today.
2. You have now found out that it is nice to have something set aside for a rainy day. If buyers who want to steal something and sellers who are no longer happy does not tip you off that the old adage of "Make hay while the sun shines" is not true, I give up!
I challenge you to open up a money market fund at someplace like ING or Fidelity. Have your broker take 10 percent of every commission check and wire it to your account. Even though it sounds scary, you will never miss it! Also, have one of the two companies (or another like them) take $10 to $1,000 out of your account every month. You will not miss it either!
3. I bet this market has proven to you that debt is a drag. Secured debt is alright if the security is making enough money to pay for the debt, but all other kinds of debt is a drag! I challenge you to have a plan of reduction. Implement a plan that entails paying cash for items. Get along longer with what you already have. Stop trying to keep up with the Joneses, because they're in debt, too! Make pay downs on the balance on a regular basis. Get a board game for the family and figure out to have more fun while spending less. Start with the highest interest rate item first. Negotiate others down.
4. Who needs stuff? I just had dinner last night with 70 year old plus friends. They have lots of stuff. He said, "Every year you are alive, you like stuff less." I challenge you to learn eBay, take stuff to a local auction, or the re-sale shops. On the items that do not sell, give it to the church or less advantaged. Take the money from the items you do sell, and apply that money to debt or savings account.
5. Discover how much faith can play in your life. If the Lord can give his only begotten Son for your sins, just think how easy it could be for Him to help you achieve your goals? I challenge you to time block some time for church on Sunday morning.
6. It's hard to read the bad news in the press and then hang out with negative people! Start believing that you are a reflection of who you hang out with. REALTORS will never buy or sell through you so if you hang out with them, they better be uplifting! Get out of the energy-draining relationships. My life never truly turned around until I put all bad and energy-sucking people nicely out of my life. I challenge you not to engage with negativity by filling your time with positives and not returning the calls of the negatives.
7. In tough times, time becomes more valuable. Some of your communication habits have to change. I challenge you urge cooperative agents to leave messages on your voice mail, if it is not your phone answering time. They need to leave a complete message so you can work on the challenge and propose a solution without having to talk to them in person. Many a deal gets put together with effective voice mail messages, never talking to the other person.
Second, when you and your client need information, try a three-way call. Hit the hold, dial the "answer man's" number, and connect all three. It will impress your client, answer further questions, and eliminate telephone tag.
I challenge you to handle the phone better by time-blocking a special two hours a day for return calls, incoming calls, incoming and outgoing E-mails and snail mail. Then I challenge you to start taming the cooperative calls and starting three-way phone calls to handle the challenge immediately.
8. On every bill you pay, I want you to ask, "How do I reduce it, eliminate it, get someone else to pay for it, or a combination?" I challenge you to stop the insanity. The internet took over print years ago. If you are going to do print, it better be creative and contrary to the competition. When everyone else advertises their sellers, why can't you advertise your buyers? If it is not bringing results, try to improve it. If it still has no return, eliminate it. I challenge you to look very carefully at your expenses. Dad said that the fastest way to make more money is to raise your prices and stop spending.
9. Many buyers and sellers have goals that are not being achieved by many REALTORS. Charge them more if you know how to achieve their goals. This involves asking more questions to better determine their needs. The answers to these questions will determine if they are realistic and motivated enough to participate in a process that is in their own best interest. Next, prepare a listing presentation that meets their core needs.
I challenge you to ask for more commission than the competition is requesting. People are willing to pay for professionals who achieve their goals. If you are one these professionals who achieve goals, ask for more than the "average" agents in your area, but you had better be able to prove you are worth the difference! Now is the time to do it!
10. This market should force you to pay attention to the numbers. How many listings are there compared to 12 and 24 months ago? How long do they take to sell and at what list-to-sale ratio? How does that compare to your list-to-sale ratio? How does that compare to the numbers of the agent that you are about to go up against?
It is all about success. The numbers prove success. People pay for success. People hang out with success. I challenge you to know the numbers that express your market -- your competition's numbers and your numbers. If they compare well, talk about them in this market and people will take notice.
11. I challenge you to pay more attention to the most profitable aspects of your brokerage business. If there are fewer transactions, it is time to capture the "prime" ones. A double-sided transaction allows a double commission with fewer delays. You know the needs of both parties, and there are less gambits. Maximize their occurrence!
Have a system that turns on the minute you get the listing "go ahead." As you walk out, take a sign out of your trunk and put it up. Call your assistant or a third-party vendor to get the new listing cards out in twenty-four hours. Delay the publishing of the listing in the MLS for about a week, but please do that as legally and ethically as possible! Contact your database with a quick E-mail about the opportunity. You should also hold the one and only open house that Sunday. Do everything you can do to use the excitement of a new listing to get your own buyer. I challenge you to go back to your most profitable, past transactions and design systems to experience them more often.
12. You are dealing with your old friends. You remember them -- the top people, the survivors, the ones who were around during the last slowdown. The new faces have proven business plans. I challenge you to start leveraging their experience.
One of the best things that I did in my area during the last tough market was to put my "Power Players Group" together. I invited them to my home for a barbeque and proposed that they all send my assistant an E-mail with their number one best buyer and number one best seller, based on fantastic motivation. I wanted them to include with the one person and one property, all the information that I would need to find them the right buyer/seller.
The leads were sent to me on Thursday. I assembled them and sent them out to the members on Friday. If you did not send leads in, you did not get the list. Since it was my idea, my assistant, and my system -- I got a twenty-four hour head start. I put a transaction together every month from that information and so did most of the group. I challenge you to form some strange alliances!
13. A normal market means a normal life. Sellers are only selling if they need to sell. Buyers are only buying if they need to buy and are getting a perceived value. There is no more emotional buying, speculation, and using your home for estate-building by flipping every two years. This means you can work a plan as discussed above. You can time-block your schedule. You can be less responsive to "urgent" and more responsive to "important."
There are fewer reasons to buy and sell when prices are not going up as fast, going sideways, or down. There are fewer reasons to jump up like a Pop-Tart to handle non-scheduled emergencies. Work the proven plans which produce more listings, make listing presentations, negotiate contracts, and show properties to qualified buyers -- all scheduled in the correct balance every day.
14. You need more marketing time. If a seller thinks that limiting your listing period will motivate you, please explain the opposite is true because of human nature. You, the agent, have to present the resources upfront. You want realistic expectations to pay back your overhead and make a profit. Please sell them on your time-blocked status reports, and go for a listing period that allows extra time for the buyers to go through the excess inventory. In most areas, a year listing is now the goal. I challenge you to get the time you need to make a profit.
15. Get out and see the inventory again. Yeah, I know -- what a waste of time. However, if you have an efficient office tour or a tour put on by the MLS, it is now time to start going on them again. You see, the new listings start leading the trend down, therefore allowing you to pay less attention to the comps and more attention to the listings that are setting the new low prices. When I went on tour in a tough market, the outstanding values were the price setters, not the sales from 6 months ago. If you have to talk to REALTORS, then maybe say, "Hi" to them on tour. I challenge you to figure out how to efficiently see the new listings in your market area about once a week. Stay away from "Sam Slow's" listings, because he never gets it right. See what the killers are listing, what they offer, and how they are pricing.
16. There are fewer agents out there. Start wearing a name tag again. Put up one of those stupid magnetic signs on your car. There are fewer agents, even fewer who are not hiding in a bunker. Start showing your bright disposition! When asked "How is real estate going?" you can say "My clients are making a fortune. What are your plans in the next twenty-four months?"
17. You will never be poor again. You see the people having trouble now have never have seen a tough market. They sold for the last ten years. They thought that buyers bugged you to buy and sellers asked you to sell. They thought you did not need down payments or credit ratings. They thought that real estate always goes up. They scoffed when you said, "Be careful." They actually believed that it was easy to make a six figure income in real estate. They bought their own home with no money down and got an interest only loan. They used the money. They saved on their loan and down payment to buy a great car(s) and beat the Joneses.
The ones who are making it have been through tough times before. Whatever does not kill you, will make you stronger. If you listen to me carefully and do the stuff you should be doing, you will make it! If you make it through this market, you will be set for life, because it does not get much harder than this. I challenge you to prosper now as you set yourself up for life.
18. You will be convinced that buyers are the least profitable segment of market, no matter what market. I challenge you to stop listening to non-agents selling technology that solicits buyers as your main income lead generator.
19. You will get to the point faster. "Either you want to buy or sell, or please call someone else." You will be able to say that nicely with no one thinking you are full of yourself. I challenge you to start that exercise today.
20. You will become closer with my systems.
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Beginning in the late seventies, Walter Sanford re-wrote records in real estate particularly in number of transactions and dollar volume. His best year was 1992 with $72 million in sales. In today's economy, that would equal to over $133 million dollars per year in personal production sales! He sold a house a day for seventeen years.