The question has been coming lately – how much do you tell buyers in the first meeting about the state of the market? In today’s world of multiple offers, escalation clauses and waived contingencies, it’s a lot to absorb for any buyer, especially a first time buyer.
There is the concern that you might scare them away, and the wistful hope that maybe they will get lucky and it won’t be that bad.
Here’s an important thing to remember: You didn’t create the market.
You didn’t create a shortage of inventory, or a surge in demand.
But what you CAN create is a scenario in which your clients feel informed and empowered to venture in and know that they will be successful.
How do you do that when it feels like so much is outside of your control?
Lay it all on the line at your very first meeting. But as with everything, it matters how you say it. More importantly, the context matters.
Here are 4 ways to help you frame the conversations in your next buyers appointments:
- Deciding quickly: Rather than being a source of stress – highlight that it’s a great filter to know whether it’s the right house. If a client is hesitating about making a quick decision it just means it’s not the right house. (without this filter it’s easy for Buyers to feel like they aren’t cut out for the market) Re-assure them that for the right house, it will be easy to say yes quickly.
- Paying over the asking price, and likely more than the last sales price in the neighborhood: Basing your max offer price on the last sale price in this market isn’t going to get it done. Whatever their sales price is will likely be the highest in the neighborhood, for now. And 6 months from now, when there have been other sales higher than theirs, they will feel like they got a deal.
- Waiving financing: This is a big one, and not to be taken lightly, yet it’s probably what needs to happen to be successful. Encourage your clients to talk to their lender early about what this could look like and what their plan B would be. If the house doesn’t appraise could they switch from 20 – 10 percent down to pay the difference? Knowing their options ahead of time is crucial to them feeling empowered.
- Focus on the interest rate: That is where the win is right now. They aren’t going to get a house 10% under market, but they are going to get an interest that will either allow them to buy more house than they thought possible, or give them a payment that is lower than they ever imagined.
In every scenario there is a benefit. This is a market that encourages quick decisions which empowers Buyers to have a clear yes or no on each house, which is much better than a “maybe”.
Whatever the market is, having clients fully informed from the very beginning empowers them, strengthens your relationship and makes the whole process a lot more fun.
To your success!