Top Agent FSBO Conversion Plan

Most agents, at some point, make an effort to convert FSBOs to Listings. But more often than not, they give up after getting abused, maligned, demeaned, cussed-out, and hung-up on. That’s unfortunate, because more than 90% of For Sale By Owner (FSBO) homes are eventually listed with an agent. That means converting FSBOS to listings truly is a lucrative opportunity, and many top agents have learned that there’s a better way to do it.

We spoke to several of our top producing real estate clients and asked them what they are doing to convert FSBOs, in addition to their custom farm marketing. The tactics they shared comprise this golden 5-touch FSBO Conversion Plan, which we sincerely hope you will put into action.

After FSBO Fatigue grinds these sellers to desperation, the vast majority finally face a humbling reality: a buyer has driven past their home dozens of time – but in the back seat of a Realtor’s car. So now Mr. & Mrs. Seller will have to decide whom to call. By putting in to practice a good FSBO Conversion Plan, you can raise the odds substantially that you’ll be the agent who gets the call and closes the listing.

But first, let’s take a look at whom we’re dealing with.

FSBOs Sellers: arrogant penny-pinchers?

Not exactly. As for the “penny pinching,” most just do a simple calculation: if they save 5-to-7% on, say, their $300,000 home, they keep $15,000 to $21,000, and that’s big money. If all they need to do is put a sign out front and wait for the buyer to show up, that’s worth it. It’s not about being a ridiculously thrifty person; to them, it just seems like a good business decision.

Arrogant?

We don’t think so either; rather, most just aren’t aware of all the work that’s involved and the skills that are needed to successfully sell a home. The ordeal doesn’t become painful until after they decide to go it alone. Like staging, marketing, showings, inspections, appraisal issues, and negotiations. If they’re lucky or in a very hot market, the phone calls will come with scores of probing, often surprising, questions. Then they get pushed into showings at inconvenient times when you can bet the kids are screaming, the dog is barking, and the sink is full of dishes.

During the showing these unsuspecting homeowners get to hear the criticisms from strangers walking around their home like they had a right to, telling each other how tacky is that sofa and how ‘80s are vertical blinds and how the place really didn’t have any curb appeal in the first place. The FSBOs didn’t anticipate any of this, never heard of “curb appeal,” and thought that since their cousin was a real estate agent it must be really easy. So FSBO sellers aren’t arrogant about being able to handle a home sale, but usually quite naïve. How dare those strangers bad-mouth our house! Yes, it’s very personal.

Personal experience with a FSBO Flub

A few years ago, I thought that I knew so much about real estate that I’d sell my own home by myself. At this point I was not clinically insane, just on the way. How tough could it be for me who actually knew a lawyer AND a title agent to sell my own home FSBO! And I also knew what “curb appeal” meant. So up went the sign and in went the classified ads. This should be a cakewalk.

I kept score: I got 23 voice mails from realtors who said they could sell my house fast and for top dollar and 7 form letters from realtors that said they could sell my house fast and for top dollar. I took 11 calls from realtors who said, get ready, they could sell my house fast and for top dollar. I also got a call from a family who just moved here from Boise and wondered if I could do seller financing, and two other calls that said it was too expensive even though I put the price in the ad. I called my realtor and signed up gleefully.

As completely unproductive as this experience was, it was well worth it. I now knew first-hand why FSBOs resented realtors – it was all those messages and calls that said the SAME THING! I learned what agents most certainly should NOT do, and the strategies shared by top agents mirror this sentiment 100%.

Top Agent FSBO Conversion Plan

There’s a few steps to follow and you’ll have to spend a few bucks and a little bit of time. You will find that FSBO conversion occurs when you least expect it, so you won’t go through all the steps all the time.

Step One: Within a week of the FSBO entering the market:

Drop off a “Let me lend a hand” gift bag. Several of these steps include gift bags, so stock up on large-size gift bags that match the color of your brand. Always use the same color bag for a prospect, so they see you are a professional when it comes to brand awareness and marketing.

Contains:

• Quart-size bottles of Windex and Mr. Clean
• A big pack of painter’s rags
• Hand-written a note on your company stationary

DO NOT include a Business Card! If you hand-write the note on personal stationary with a company letterhead, they will figure out who you are. Also, do not put the letter in an envelope – just fold it text-side out, and stick it among the bottles.

Your note should say something like, “I know how much work goes into prepping your house for the market, so I hope these little things are useful for you or your cleaning crew. Sorry to see you leave the neighborhood, but best wishes on your next home.”

Please remember, you’re dealing with someone who’s received a barrage of Realtor calls and letters, who perhaps has a bad attitude toward agents, so NO SELLING, NO PITCHING! Use a large, grocery-size gift bag and hang it on the front door knob. ALWAYS use the same color bag and the same letterhead. This consistency also shows you’re a tenacious marketer.

Step Two: Four days later:

Deliver a “Curb Appeal” gift bag.

Contains:

• 3 yard waste bags from Lowe’s or Home Depot.
• Another hand-written note, with your name/number on letterhead, no envelope, NO business card.

This time, write the note about how curb appeal is the number one influence on a buyer’s decision, as well as a buyer’s first impression online AND in person. If you have teenage children or know some neighborhood high-schoolers you can hire inexpensively, offer to have two helpers come by the following Saturday at a specific time to help with the yardwork for one hour, such as raking the lawn and flower beds.

Ask them to text if it is NOT OK for the kids to come by during the chosen time slot. You should drop off the kids (always in a pair, and with cell phones, for safety), stay within close range, and pick them up an hour later. You’re still not ready to initiate a conversation.

Step Three: Five days later:

The “Break Time” gift bag.

Contains:

• Cookies or crackers.
• Nuts or popcorn.
• A few bottles of juice or soda.
• Third hand-written note, in exactly the same form as before.

In your note, talk about how important it is not to let their home sale become overwhelming, to be sure to take a break and enjoy what they have accomplished so far – “hang in there, it’s gonna pay off!”

Step Four: Three days later:

The “Open House” gift bag.

If the FSBO still hasn’t been sold by this point, this is a good time begin the “let me help” conversation.

Contains:

• A Market Analysis summary sheet.
• Generic Open House sign.
• Open House Tip Sheet.
• Fourth hand-written note.

The idea of this fourth touch-point is to give pointers on running an Open House, and also to let them know that you’re here to help. On the note, talk about how open houses are few and far between these days, so holding one can really make an impression. Explain that especially as a FSBO seller it may help boost interest if they conduct one (hint = they will not want to).

Do NOT run a full CMA, just a one-pager that recommends what their house should sell for. The Tip Sheet should be exhaustive, to let them know what you would do if you were going to run it.

Step Five: Three days later:

The “Call.”

If you get all the way to this Step without a conversation or a call from the homeowner, now is the time to call them. Simply ask if they’d like to meet to review where they’re at in the sales funnel so you, the realtor, might contribute any other information that might be useful.

The investment pays off

This entire process can cost upwards of $100, and for this reason very few agents have attempted something similar. You will be boosted so far above the millions of other agents calling and calling with the exact same pitch. You will not get them all – but you will get some.

FSBOs aside, if you are interested in a unique and powerful way to farm your area for listings, check out the 12-page custom publication used by top agents. It’s become known as a “secret sauce” for developing and expanding market dominance.

Good luck and, most of all, have fun!

People ask:

[sc_fs_multi_faq headline-0=”h2″ question-0=”What is a FSBO Listing?” answer-0=”For sale by owner (FSBO) is when a homeowner lists their home without the assistance of a realtor.”  headline-1=”h2″ question-1=”How do I win a FSBO?” answer-1=”There’s a few steps to follow and you’ll have to spend a few bucks and a little bit of time. You will find that FSBO conversion occurs when you least expect it, so you won’t go through all the steps all the time.” headline-2=”h2″ question-2=”Which are the steps to win a FSBO?” answer-2=”Step one: Drop off a “Let me lend a hand” gift bag. Several of these steps include gift bags, so stock up on large-size gift bags that match the color of your brand. Always use the same color bag for a prospect, so they see you are a professional when it comes to brand awareness and marketing. Step two: Deliver a “Curb Appeal” gift bag. This time, write the note about how curb appeal is the number one influence on a buyer’s decision, as well as a buyer’s first impression online AND in person. If you have teenage children or know some neighborhood high-schoolers you can hire inexpensively, offer to have two helpers come by the following Saturday at a specific time to help with the yardwork for one hour, such as raking the lawn and flower beds. Step three: The “Break Time” gift bag. In your note, talk about how important it is not to let their home sale become overwhelming, to be sure to take a break and enjoy what they have accomplished so far – “hang in there, it’s gonna pay off!” Step four: The “Open House” gift bag. If the FSBO still hasn’t been sold by this point, this is a good time begin the “let me help” conversation. Step five: The Call. If you get all the way to this Step without a conversation or a call from the homeowner, now is the time to call them. Simply ask if they’d like to meet to review where they’re at in the sales funnel so you, the realtor, might contribute any other information that might be useful. ”  count=”3″ html=”true” css_class=””]

Real estate closing gifts are not a new phenomenon, but sometimes real estate agents aren’t sure what to give. Let’s face it, our clients are all our businesses really have. Showing appreciation is not just polite but critical for keeping and building upon those relationships. Over the years we’ve learned a lot from our many friends in Real Estate, most of whom have built hugely successful practices, and we’d like to pass that wisdom along. Below are some important guidelines and some great ideas for your next closing gift.

How Much To Spend:

We suggest you spend between $40 and $100 on closing gifts. Spend more for big, complicated sales and less for smaller and simpler sales. When my husband and I sold one of our houses over the summer our Realtor gave us a simple, inexpensive, but very thoughtful gift. Our family has worked with this agent for over 20 years and probably bought and sold 20 houses with her. This particular sale was small, simple, and very fast so a small thoughtful closing gift was perfect. She hand-wrote a thank-you note with a $25 pizza gift card and also brought us a soft cooler full of water bottles. Every time we take the cooler to one of our daughter’s swim meets we think of our agent and how she even kept in mind the season when showing us her appreciation. It was a small token but had a big impact – nothing more was necessary.

However, if spending more is in your budget or fits your market better, go for it. We know an agent who spends $100 every time on fancy closing gift baskets and another one who always mails a $50 restaurant gift card and a bouquet of flowers. Both agents do this consistently regardless of the size of the sale. We also know an agent in the luxury market who will take the homeowners (or sellers) out for an expensive dinner to celebrate. Each sale brings in quite a bit of commission, so spending a few hundred dollars and a few hours of his extremely precious time makes sense. Most of the time we see agents spending more money on larger sales or sales that took longer or had more set backs. Whatever you do, don’t go too cheap, especially if the closing gift is generic. Generic gifts are easier to forgive if they’re pricier.

What to Give:

Buying a home, either for the first or umpteenth time, is a deeply personal task for anyone. Be sure that your closing gifts represent not only your personal relationship with your client, but also represent how building a personal relationship with your clients is something you always do. The gift should provide your client with a lasting impression of how much importance you place on your client relationships. Because your clients are your best source of new business, your closing gifts should say: “I know you, I care about you, and I’ll get to know and care about your friends and family just as much.”

Be Genuine and Thoughtful. This one is crucial, and happens long before closing. After all the time you’ve spent with your buyers or sellers, you probably know a lot about them. If they don’t volunteer personal information early on, be sure to ask. Ask about their kids and how they spend their weekends. Are they the indulgent type, or more practical? Religious? Artistic? Are they into wine, coffee, beer, sports? Are they gaga over their pet, or perhaps expecting a new baby? Tailor closing gifts to your client’s personality, stage of life, and preferences. For example, my husband and I are practical people with a bunch of kids, so pizza and a soft cooler resonated. My single, fun-loving sister, however, received gourmet coffee, a funny mug, and an Amazon gift card when she bought her first home, which was perfect. 

If you have a good sense for your client’s personality, here are some creative ideas:

Young families:

Think about closing gifts that will become part of the household, so you are thought about often, or things that make the hectic business of raising kids a little easier. You could also go the kid angle; parents are really moved when someone goes out of their way to make their kids happy.

1. Game Night basket; this is a great idea that we stole from an agent we know. You’ll have to put it together yourself because I’m not aware of a retailer who offers this. Load up a big basket with board games, Pringles, a sixer of IBC, and a gift card for pizza delivery.
2. Movie Night basket; this you might actually find online. A few family-friendly DVDs, a bucket of popcorn, and few movie-theater candy boxes.
3. Personalized Door Hangers; get Mom and Dad and each kid a personalized nameplate to put on the door to their room. This can be a nice-looking sign or a doorknob hanger they can flip to “Do Not Disturb.” You can wrap them in a gift box and present them with a nice housewarming bouquet.
4. Holiday ornaments; select a special ornament for each family member and wrap in a beautiful box. This gift will make a very sweet impression, and perfect if your client is the sentimental type.

Obsessed-with-the-pet People:

The fastest way into the heart of people who treat their pets like their children is through… their pets. Pet-related gifts should always be given with something else, like flowers or a restaurant gift card. Write in the Thank-You card how you wanted to get a little something for Fluffy because you know this will be a big adjustment for him.

1. A box of gourmet dog treats; some specialty pet stores or online retailers sell cute treats that look so good you’d want to eat it yourself
2. A personalized nameplate they can put on a doghouse, if they have one
3. A dog or cat bed monogrammed with the pet’s name; this is especially appropriate since they are moving into a new home, and the pet will have their own special place

Expectant parents:

If clients have their first baby on the way, this is a great opportunity to personalize your closing gift. Soon-to-be new parents are usually pretty over the moon about their little one, so anything baby related will be a hit. But like with pets, be sure to also give something for the parents or household, even it it’s just flowers. Warning: stay away from baby gifts for clients expecting babies number 3 or 4; for these parents, think of gifts that will help them to relax and unwind.

1. Monogrammed baby blanket; before selecting, be sure to ask about the nursery colors and try to find one with a “Home Sweet Home” or “Welcome Home” theme to tie it back to their new house.
2. Growth Chart; look online or at Babies R Us for a wall-mounted cloth that records the child’s height over the years. There are some you can stick photos in, and you may be able to have it monogrammed too.
3. Don’t get: baby clothes. They will never remember who gave them what outfit because they’ll receive so many, and the baby will outgrow the clothes in about five minutes.

Empty-nesters:

If you’re helping an older client whose children grew up long ago or a couple whose last child recently moved out, sentiment and thoughtfulness are probably more important than practicality. Think of gifts that remind your client of the important things in life, or helps a couple reconnect after years of rearing children.

1. Romantic evening out; give them a gift card to a nice restaurant with a heartfelt letter expressing how much you hope they enjoy this next chapter of their life together. For the right couple, something fun like a ballroom dancing lesson or couples massage might be appropriate.
2. Gardening gift basket; assuming they like gardening, fill a basket with seeds, a colorful book on gardening tips, tools, gloves, and maybe a watering can or lawn ornament. This is doubly appropriate since it relates to homeownership.
3. Personalized mantelpiece with a family portrait and picture of the new home; this may be tricky because you need to stealthily get a family portrait. You may find one on your client’s Facebook page, if they have one and shared it with you, or you may need to ask. Simply tell them you’d like to frame a family photo for their new home. You can do a side-by-side of the new house and the family, or have a picture of the old house with the dates they lived in it, the family in the middle, and then the new house with the move in date inscribed below.

Compassionate bleeding hearts:

People who live to make a difference are often turned off by flashy presents and sometimes even feel guilty accepting them. You can spot these types by their modest home decor, church involvement, and how often they talk about others.

1. Donate to a charity in their name; we got this idea from an agent in Ohio and she says her clients are usually very touched by this. Make sure the charitable cause is something they believe in – or, better yet, a charity or church they are already involved in. Make sure they have a plaque or another physical item to commemorate the donation, and we recommend you also give them a small gift.
2. “Adopt” a family (or child) in their name; be sure to get a photo of the family or child being helped, and also make sure they know how much money or what items were given to them on their behalf.

If you really don’t have a sense for the client’s personality, here are our favorite standbys:

1. Welcome mat; this can be customized with the family’s last name
2. Treat basket; everyone loves a basket of goodies and there are thousands of retailers out there putting together great baskets. Warning: be sure you know about any food allergies, or if your client is vegetarian or vegan, a super health nut, or avoids gluten. If you’re including alcohol or coffee, be sure to first ask if your client partakes.
3. Restaurant gift card; all you have to do is ask where they like to eat. You should always accompany a gift card with something tangible, like flowers or a box of cookies.
4. Edible Arrangements. Yum! Fork over some extra cash to get them one with lots of chocolate-covered pieces.

A Final Caution:

 Now that you know what to give, here are a few “Definitely Don’t” gift ideas:

1. Cheap branded stuff. You know what I mean. It’s fine if you want to give them a refrigerator magnet or a $2.00 calendar with your face all over it, but stick stuff like that in with the closing documents and also give a real gift.
2. Nothing. Bad bad bad. You must give a closing gift.
3. Babies. They are cute, but not practical. Plus, I think it’s illegal.

We hope you’ve found this useful! Please share your thoughts and what gifts you give.

Why Salesy Real Estate Marketing Fails with Today’s Sellers

Quick: take a look at these two headlines. Each appears on the front cover of a real estate agent’s local newsletter or publication.

1. “Peter Pumpkin-eater named #1 Producer at Joker Broker Inc!” (by Peter Pumpkin-eater)
2. “Record High Prices for Sunnytown Homes this Season!” (by Berta Experta)

Which article would appeal to you, a homeowner in Sunnytown? How much would you care about Peter Pumpkin-eater’s awards, even if you happened to know him? After getting a newsletter with a cover story like Peter’s, month after month, you’d probably start throwing it right in the recycle bin without so much as a glance.

But what about receiving a newsletter – or publication – with cover stories like Berta’s, month after month? You might begin to anticipate some useful market information when it appears in your mailbox. Instead of pitching it, you might toss it on the counter, and read it the next morning while your coffee brews. This all seems obvious, but yet we see it every day: agents who wouldn’t give two hoots about, for example, their insurance agent “hitting goal” turn around and build huge expensive campaigns about their personal awesomeness.

You’ve probably already made massive changes to your business in the wake of Coronavirus, so what better time to take a good hard look at your marketing messages!

Fact: buying patterns have changed dramatically in the last 10 years.

As more advertising mediums become available, the more consumers are becoming conditioned to tune out to anything that seems “promotional.” Content Plus found that 70% of consumers prefer getting to know a company via articles rather than ads, and a TMG Custom Media study revealed that 78% of consumers believe that organizations that offer custom content are interested in building good relationships with them. While it’s important to communicate the value you offer – and to share real-life success stories about who you’ve helped – building a trust-based connection is the foundation for generating listings and referrals.

Trust is built in the emotional part of the brain, deep in the subconscious.

We don’t decide to trust a person; rather, we one day realize that we trust someone. Add to that the the fact that big decisions – including most major purchase decisions – happen in the part of the brain where emotions are processed. Trust is an emotion. To put it very simply: trust = purchase.

A brain scan study by Mart Lindstrom in 2015 backed up claims that 90% of purchasing decisions are not made consciously, and that brands that are intentional about evoking our emotions always win. Decision-making may be wired to our emotions for very good reasons. For one, it is impossible to consciously tally, process, score, and react to the hundreds of facts and other non-overt pieces of information coming at us. Our emotional subconscious does this for us and outputs a “gut feeling,” without our awareness.

The beautiful thing is that this “gut” is very efficient at making the right call. It’s in no way a shortcut. In fact, relying on a well-honed instinct is indeed more efficient than manually – consciously – wading through a million variables. We’re built to rely on it – in extreme cases, our very survival depends on trusting our gut rather than a painstaking conscious calculation. For most people, the emotional brain is a well-oiled super-computer so it’s no surprise that decision making occurs there.

What does this mean for real estate agents?

The key take-away for real estate agents is this: if two agents are competing for a listing, the one who has taken time to embed themselves in the emotional brain of the homeowner will get the listing, even if they’re younger or less successful.

“Embed themselves in the emotional brain” means marketing and prospecting in a way that resonates at a human level, garners an emotional response, and leaves the prospect feeling that the agent knows and cares about the market, gets great results, and can be trusted.

In order to develop these emotions about the agent, the homeowner needs to repeatedly experience these emotions while at the same time learning about or engaging with the agent’s brand. For this to happen, the agent must truly be trustworthy, get good results, and care – because those are the things he or she need to impart through their marketing. Otherwise, no amount of “messaging” will seed legitimate emotional headspace in prospects.

So, how can you do this?

How to implant yourself as the Real Estate Agent of Choice
in the emotional brain of homeowners in your farm

First, you must show (not just tell) your prospects that you care about them, the community, and ultimately, their home sale. Marketing with information they personally care about accomplishes this much faster than sending information they don’t care about. Against our best advice, we’ve worked with agents over the years who’ve insisted on publishing self-promoting articles on the front covers of their publications. After investing thousands of dollars, they either learn the hard way and begin publishing community-related content, or they quit publishing altogether in frustration (and to be blunt, arrogance). We encourage agents to keep their custom content focused on the community; for example, during the pandemic, we published articles for agents about how Coronavirus was impacting the local housing market. Similarly, we take care to ensure the general articles (the syndicated stories we publish inside each client’s paper) hit home and resonate with homeowners. Whether you publish with us or do your own newsletter, these principals apply.

And here’s the key: make sure your picture and branding is on the header and all throughout your marketing, so that when the reader is engaged with an article or feature, they implant you in their emotional brain as they read and react to it.

Branding remains paramount

When you regularly supply your prospects with interesting, valuable information (such as with your newsletter, publication, emails, social posts, webinars, etc.), you need to be front and center. This doesn’t mean how great you are, but your branding must be prominent. Otherwise, you’ll be cultivating meaningful emotional responses, but the connection to you will be lost.

Additionally, it’s important to layer in messages about what you do and how you can really help. Do this in ways that actually resonate; for example, instead of a dry testimonial, run a short feature called “Sunnytown Success Story” with a photo of a happy couple you helped, and tell the story of how they needed to move quickly, how you helped them with fix-ups and staging, and how you marketed it to your broker network for multiple offers. Or instead of an ad about being #1, present an infograph of exactly how you stack up to other agents (Average Sunnydale Agent: Sells 2 homes per year. Berta Experta: Sold 28 homes last year. / Average Sold Price in Sunnydale: $200k. Average Sold Price for Berta’s Clients: $235k). This communicates to the homeowner that you don’t expect them to hire you just because of a fancy award – that you mean business and get tangible results.

The most important message here is that self-promotion fails as the core of any marketing strategy. Think instead of how to show the area you are a caring, knowledgeable, trusted expert. And make sure they know it’s from you.

How Experts Use Open Houses to Generate Listings

We’re sure you’ve heard the buzz about the hot new thing in Real Estate sales! Robot Listing Agents? No. Government-mandated 20% real estate commission? NO. The diesel typewriter? No, no, no.

Give up? It’s the Private House Showing – a strange, new approach to sucking the listings out of neighborhood after neighborhood – and maybe even selling the original listing!

What? You’ve been in real estate for 123 years and never heard of such an outlandish claim? No wonder, because it’s one of our industry’s newest concepts and it’s a great way to harvest listings when inventory is low.

We first caught wind of this new approach several months ago from clients who raved about their success after shifting their entire attitude about open houses. After doing a bit of digging, we discovered that the legendary real estate coach, Tom Ferry, was one of the brains (or perhaps the brain) behind these ideas. We’ve included a direct link to his video presentation on this topic at the end of this article.

Step One: Change your mindset about the Open House

If you’re like most of us, you slightly resent all the tire-kicking nosey neighbors trudging through your pristine listing and grabbing handfuls of your chocolate mints and Reeses-Pieces. Then they take several of your pricey, full-color, multi-page presentation brochures “just in case we decide to move 3 doors down and buy this place…” It’s almost as bad as that poor car dealer watching the family walk in after loading up at Dairy Queen. Grab the Windex!

Now it’s time to forget all about those things and look at the neighbors as home-sellers in your personal Listing Farm, ripe for harvest. Not only do you no longer care about your former angst over their visit, now you actively invite their visit.

Step Two: Hold a “Neighborhood Only” Sneak Peak

A few days before your Open House Event, introduce yourself to the neighbors by going door-to-door. Distribute flyers with a large photo of your listing and a prominent price. You’re not introducing yourself to ask if they’re interested in listing their own house – this isn’t a “door knock” in the traditional sense. If you’ve been actively farming with, say, a custom publication (or any “expertising” form direct-to-the-homeowner marketing), the knock won’t be so cold. They will already recognize you as the area’s real estate agent.

When they answer the door, you introduce yourself and invite them to the Von Tuttlesnoogle’s open house for a catered lunch and a private, neighborhood-only sneak peak. Of course they could bring friends too, but the idea is to show the neighborhood how YOU market your listings. And be sure they know what’s for lunch – it’s amazing how good food can bring people together.

Step Three: Set Listing Appointments

When the neighbors show up, many may ask what you think their home would sell for and they hope you’ll guess high. Now’s the time to make the appointment to get their address and offer to bring over a CMA rather than just educated guess, which is, after all, still just a guess. You may even notice that some sellers may be anxious to talk turkey about listing to get ahead of all those other neighbors now milling about the open house!

If you’re hooked on this approach to marketing around your listings, check out the very entertaining presentation by coach Tom Ferry. He does a fantastic job fleshing out this concept:

http://www.tomferry.com/blog/tomferryshow-episode-62/

Thanks Tom, you’re a genius! Good luck with your open houses, agents, and let us know your thoughts.

In most parts of the country things are pretty good in the real estate market, but many of us know that the biz is very susceptible to dramatic cycles and shifts in conditions. Since we’re not unusually stressed-out, this may be a good time to take a look back and be prepared to handle the next Big Party-Pooper.

Most of you won’t remember 1980 when the prime rate hit its all-time high of 20.5% and stayed close to that for over a year. Paul Volcker was the Chairman of the Federal Reserve Board and would not budge even though thousands of influential business people, including President Carter, were begging him to lower the rate and forget about inflation.

Sorry, We’re Out to Stem Inflation

During that era interest rates for real estate mortgages hovered around 18%. That’s right, 18%! How many houses do you think you could sell when the monthly payment for an 80% loan-to-value, 30 year, $300,000 home would be $3,600/mo for just principal and interest! How many folks who needed a home in that price range could qualify? The real estate market, obviously, suffered long and hard.

I remember meeting my Dad at Rax Roast Beef in Oberlin right around then. He had lived through the Great Depression of the ‘30s and had lots of battle scars from growing a manufacturing business and raising eleven children with Eastern European appetites. I needed some sage advice and Stress Relief from a member of The Greatest Generation at that moment, when real estate was slower than a snail crossing a peanut butter patch.

“How did you get through it, Dad, with 35% unemployment, bread lines, soup kitchens, boarded-up foreclosures – how did you get contracts, keep the business going?”

The Secret

He smiled and slowly nodded, and I was pretty sure that he was rather proud of himself and others like him. He took one of his famous dramatic pauses and had a couple curly fries, then said, “The secret is simple: Life does not stop. Wheels keep turning. People still bought Buicks, they just didn’t buy as many of them. The business is still there, you just need to be a lot more clever and work a lot harder than the next guy.” If you look at the picture above, it’s of an ad for a brand new Buick model… in 1932, the depth of the Great Depression.

Just as my Dad predicted, the world did not stop spinning, some people were very clever and did work harder, and the lending industry came up with a thing of beauty: the Adjustable Rate Mortgage aka Variable Rate Mortgage. At first, the specter of ginormous payments down the road scared a lot of people. It was hard to live with the threat of an unaffordable payment when the rates adjusted incrementally upward, usually after 1, 3, and 5 years. But cool heads prevail: we explained that, theoretically, there was no need for these instruments to lead to panic and foreclosure because, if we really had faith that the US economy would correct itself, our buyers could refinance a few years later and have normal, level payments that were truly affordable. And that’s just the way it played out, a proverbial win-win for the borrower and the lender.

You may be wondering if I didn’t know about what happened in the real estate market during the Crash of the 2007 to think that ARMs were actually good things. No, it’s just that ARMs only work if the borrowers are actually financially qualified, unlike the foolishness of government-backed loans to folks who were not.

So enjoy the good real estate climate but be open to innovation in these times of shifting sands – we’ll have to be clever and work hard to adjust to changing lifestyles, demographics, global economic conditions, and a host of other influences on our industry.

Episode 3: “Eminem Headlines! Is It The Real Slim Shady?”

It’s Party Time! In this installment of “War Stories” we meet a big-time agent who SHOWS big-time  customer appreciation. This successful agent throws an elaborate party to thank all of the clients who helped get him to the top. This agent has a trick up his sleeve to make the event quite memorable indeed.

The takeaway here is simple: you cannot be a successful real estate agent without clients who want to buy and sell homes. You can never go wrong showing appreciation to those people who have helped you achieve success.Enjoy our latest video, and be sure to subscribe to our YouTube channel and Facebook page for the latest news, content, and updates. Happy marketing!