Hey, agents. I’m sure we’ve all been told to build a bridge and get over it. Kind of harsh, you think? So how about we—build a bridge and meet in the middle? It often seems there is a cavernous divide between buyers and sellers—and their respective agents—in real estate transactions. Both parties seem to forget the time(s) they played the opposing role. So, in order to be a GREAT real estate agent, it’s your responsibility to balance your client’s interests with those of the negotiating party. Become the bridge, because ultimately, meeting in the middle will help you prioritize your client. You’d be surprised how powerful and profitable a little empathy and psychological awareness can be!
Here are some important things to remember about each party in real estate.
· Buyers can get caught up in the features of a house—open floor plan, expansive yard, square footage, etc. Features (like these) are great, and they should be highlighted by both the listing and buying agent, but how will these features add to or detract from the buyer’s overall happiness in that home? Listen to what buyers want, but also, realize what they need—don’t consider or market homes for your client based on a short (or long) list of features, alone. As the listing agent, describe homes’ location and/or community. These are important factors that buyers often overlook. And buyer’s agents, ensure these descriptions are realistic. Be prepared to back up or challenge seller’s claims.
· Buyers are making a big purchase. Probably the biggest purchase they’ve ever made. Yikes! And when expenses begin to pile up, it’s easy for buyers to compartmentalize their finances, because ahhh, they’re emptying their pocket book! Listing agents, don’t disguise features of a home that could become severe financial burdens for a buyer in the near future (roof replacement, electrical issues, pool maintenance, etc.). Buyer agents, help your clients look for expenses they may need to consider within the first year or two of purchasing a home (renovations, maintenance, furnishing, etc.).
· People make investments for the return. So it’s only natural that current homeowners (sellers) are committed to making a profit from the sale of their home (loss aversion), and buyers are interested in purchasing a home for its long-run, payoff potential. These simple tendencies, however, can hinder sellers from selling their home and buyers from getting what they really want in a home. Listing agents, you are hired to sell homes…in a timely manner…at the best possible price. Consider both the financial needs and hopes of your client (seller), but remember, it’s your job to provide a realistic listing price. Always be prepared to back up this price suggestion—it better be well researched. Buyer’s agents, remind your clients that money isn’t happiness. Try showing them properties that meet their needs, wants, AND equity aspirations. All three factors are important in helping clients make the best and most-informed decision. Aside from the fact that ROI is uncertain, equity is also realized after the fact. It is important that clients are happy with a purchase for reasons other than a potentially hefty ROI.
· A house is a house. But to most sellers, the house they bought years ago is no longer “just a house.” It’s a home. Listing AND buyer’s agents. Be sensitive to this. A seller’s emotional history with their home is powerful in influencing every decision they make and every reaction to decisions you make. In fact, it may cause sellers to act in ways you consider irrational. Don’t belittle what your clients are feeling, or express frustration when they’re seemingly uncooperative. Do feel free to tell clients to check their emotions, but don’t be surprised, if they can’t or don’t.
· Comparison. Comparison. Comparison. I mean, in real estate (on the listing side), we’ve got a word for it. “Comps.” Comparison in the buying realm, however, is also extremely common. In fact, it’s natural…House 1 has a two-car garage but House 2 has a three-car garage. Comparison is a green-eyed monster because buyers may not care that much about the features they are comparing. So, buyer’s agents, remember to begin all real estate searches by asking your client what is most valuable to them. This will help you keep your client’s perspective in line. Listing agents, your listing may be chock-full of features that would make many buyers swoon, but your most interested buyer is hung up on a comparison with another property. Don’t stop marketing these features of your listing just because one house has it better. Flaunt what you’ve got, and remind your sellers their house is still valuable!
Stay tuned for more psychological intuition.
But for now...peace & blessings, agents!