Module 4

Marketing Opportunities in the Buyer Counseling Session

4-1

Think Creatively

Fancy That

4-2

THATTHAT

Quick Survey

Write down the ONE(1) thing you like MOST about representing buyers.

Write down the ONE(1) thing you like LEAST about representing buyers.

Like Most?Like

Most?Like

Least?Like

Least?

4-3

Like Most… Excitement & satisfaction 27%

of helping buyers find their dream home

Satisfaction of serving 24% buyer’s needs

Broader Survey Results

Based on a 1998 survey of 260 ABR students conducted in Arizona & California by Hogan School of Real Estate

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Broader Survey Results

Like Most… Getting paid faster 15%

Friendship & referrals 5%

Lower costs than listings 5%

Based on a 1998 survey of 260 ABR students conducted in Arizona & California by Hogan School of Real Estate

4-5

Broader Survey Results

Like least… Buyer disloyalty 29% Buyer indecision 19% Lack of honesty 11% Wasting agent’s time 8% Driving buyers around 6% Unreasonable expectations 6%

Can these be controlled?

4-6

Based on a 1998 survey of 260 ABR students conducted in Arizona & California by Hogan School of Real EstateHow can these issues be minimized?

Counseling Session Goals

Eliminate the three Us Unmotivated Unqualified Uncommitted

Increase BBA What’s yours?

4-7

Counseling Session Goals

Position yourself & re-position your competition

Get the job Exclusive agreement Today or tomorrow?

4-8

Differentiate yourself

The Power in Words

Speak from the buyer’s perspective:From: To:

Sell vs. Help acquireSalesperson vs. Business consultant Deal vs. TransactionCMA analysis vs. Customized mkt.

analysisPre-approval vs. Loan commitment

Other“Power”Words

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The Interview

Who’s interviewing whom? It’s not about price, bedrooms or

baths Buyers don’t care about you until

they know you care about them Exceed expectations Defeat the stereotypes

4-10

The Interview

Discuss the “hard issues:” Environmental Megan’s Law Due diligence Agency disclosure Contract issues Total and accurate acquisition costs

Business consultant

4-11

Hard

Yes, these are REAL!

4-12

Issues

Example:

Restrictive Restrictions

4-13

Hard Issues

Example:

Protecting the Buyer regardingMegan’s Law& Scorpions

Exclusivity

Duration

Compensation

Top 3 Agent Fearsabout Buyer Broker Agreements

4-14

Non-Exclusivity

It’s an open listing All risk, no reward Wastes buyer’s time Wastes agent’s time Promotes disloyalty & indecision

4-15

Exclusivity

Balances risk / reward Reduces wasted time Promotes loyalty Displays decisiveness

Caution: Exclusivity demands the agent’s commitment

4-16

Duration

Don’t use a property “listing mentality”

Analyze buyer motivation & urgency High present need -- short term More distant need -- longer term

Don’t “short change” yourself Allow for cancellation Allow for trial period

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Compensation

Question: Are your services valuable?

Answer: YES!!!!

Conclusion: You deserve to be paid.

4-18

Compensation: Paid by…

Seller 56% Buyer as % of price 12% Buyer & seller 11% Buyer as flat fee 2%

In 25% of the transactions, the Buyer paid some or all of the fee.

From NAR’s 2001 Profile of Homebuyers and Buyer Agents4-19

Modes of Compensation

Percentage of acquisition cost Flat fee Hourly fees

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Compensation Considerations

Stated clearly in agreement? Accept MLS co-op? What if co-op is lower? What if co-op is higher?

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Compensation Considerations

If unwilling FSBO…? If unwilling builder…? Does buyer have the $?

If willing FSBO… Single party listing or… Seller compensation with no agency?

4-22

Hourly Fees

New homes Menu of services Consulting Expert witness services Research for investors

4-23

Retainer Fees

Indicate commitment Assure some compensation Consider:

Accounting Apply toward full compensation? Are you committed?

Caution: Be consistent as to how and to whom you charge retainer fees. Keep Fair Housing Laws in mind.

4-24

Reports & Time Charts

Make services tangible Keep account balances Prepare invoices

4-25

Time Sheets & Report

4-26

You want me to sign WHAT?

Breakout Session: What services do you perform that

add tangible value to the transaction for the real estate buyer?

How do you differentiate yourself from your competition?

WHY?

4-27

Let’s Play 20 Questions

Curtis Hall’s 20 Questions Generate ideas Focuses on issues

See Appendix

4-28

Is it a Go or a No Go?

If a Go: Run all the bases and

“Bring the Buyer Home.”

If a No Go: Thank the prospect and

wish them well.

4-29