Intertec™ FISBO Presentation Flashcards
Memorize, Internalize & Learn The Language Skills Necessary To Become Successful At Listing FISBO Properties.
Single Greatest Advantage (SGA)
1- May I ask … what is the single … greatest … advantage … you would have … selling your home directly to … a buyer? (WFA) Save the commission … isn’t that right?
- May I ask … what is the single … greatest… advantage a buyer would have … in buying the home directly … from you? (WFA) His single greatest advantage is to save the same commission … you hope to save … isn’t that right?
- Is there any possible disadvantage … you would have … in continuing to try to sell your own home yourself? ADM
Advantage
In a negotiation, w ho has the advantage? You … with one home to sell … or the buyer … with multiple choices … and the money? Who has the advantage?
Calls and Offers
How long have you advertised your home for sale?
How many calls did you receive last week?
How many of those calls were from real estate people?
Of those not from real estate people, how many came out to see your home?
How many made an offer?
Do you know why no one made an offer? Do you want to know why? (90% Not Qualified)
So no potential buyers called you last week, right?
Do you know why no one came out to see your home? Do you want to know why? (Four Kinds)
My Calls v. Your Calls
Last week in our office, we had _____ calls from potential buyers … and you had _____?
PQS
Has anyone ever told you the difference between a POTENTIAL buyer … a QUALIFIED buyer … and a SERIOUS buyer?
Potential buyers might buy. Qualified buyers can buy. Serious buyers want to buy.
But… we can have a qualified buyer who is not serious. Or … we can have a serious buyer who is not qualified. So … the only kind that counts is a … serious … qualified … buyer isn’t that right?
Odds
Do you see how the odds are stacked against you?
Time to Consider
Is it time for you to consider listing with a good real estate agent?
When do you think it would be a good time for you to find a good real estate agent?
Where Buyers Look
Right now … today … in (our city) there are a certain number of people who are absolutely serious about finding and buying a home. Would you agree with that?
One of the ways they look for a home is in the local newspaper. Statewide or nationally 85% of all the homes are in the hands of real estate firms. Only 15% of the homes for sale are By-Owners.
Another place they look is in “Homes For Sale” type magazines, published by the local Board of Realtors or private companies. 99% are real estate listings.
And they can look on the internet. In fact, many people go here first.
When they go on-line … here’s what they see:
If they go to Realtor.com/ca, 99% of the homes are listed by real estate.
If they go to our local MLS website, 99% of the homes are listed by real estate.
If they go to an individual firm website, 100% are by listed by the firm.
If they go to an individual agent website, 100% are listed by the agent.
If they go to a For Sale by Owner site, the message they get is: “Buy Direct and Save.” By-owner sites attract buyers by giving away the commission you are hoping to save!
When all homes for sale are counted, between 90% to 93% are listed by real estate.
Four Kinds
Basically, there are four kinds of people who look at homes. The first kind are in a hurry to move. They have a sense of urgency. They may have been transferred, or they already sold their present home, or they just want to make a quick decision.
The second kind are not in a hurry. They have no sense of urgency, but they are serious buyers. They may be young people or other first time buyers proceeding cautiously. Or they might be second or third time buyers looking for a very special home.
The third kind are looking for a real bargain. Their idea is to save the commission that goes to a real estate firm, or worse, they want to find someone who is desperate to sell, or uninformed, so they can buy the home for thousands of dollars under fair market value. This group also includes people who don’t qualify for bank financing and hope to find a seller who will self-finance / hold the paper / sell on land contract.
The fourth kind will never buy. They can’t afford to buy or just don’t want to, but they sure enjoy looking at homes as a pastime.
Four Kinds Tie Down
If real estate firms have 90% of the homes for sale, where are the serious buyers most likely to go?
To real estate, right?
So … what kind is left over for you … bargain hunters … wannabe buyers with bad credit … and casual lookers, isn’t that right?
Las Vegas Analogy
Every year a few people go to Las Vegas, put a buck in the slot machine, pull the handle and hit the jackpot, but the odds are against it. Do you agree?
Every year some people come out ahead, but the odds are against it. Every year some people break even. The odds are still against that. Most people must lose money, or Las Vegas would not exist.
The point is … every year some people sell privately, overprice their house and find a quick cash buyer, but the odds are against it. Every year some people sell privately and net more than by selling through real estate. The odds are against it. Every year some people sell privately and break even. The odds are even against that.
Most private sellers must lose, or we would not exist. If the average seller could stay home for three weekends and net an extra $1,000, our industry would be out of business. Real estate sells 93% of all property because we help sellers net more money
90%
90% of all direct buyers are not qualified to buy the homes they look at.
90% of all direct buyers will not be qualified to buy your home when they come here. Here’s why:
If buyers are serious.. .and intend to buy directly from sellers … the first thing they do is qualify themselves. They go to their banks, or wherever, and find out how much they can afford to pay.
Let’s say they qualify to buy a $150,000 home. They don’t look at $150,000 homes. They look at $170’s … 180’s … 190’s. (Repeat with example prices near the value of the seller’s home.)
Remember … they’re out to find a bargain. At the very least… they want to save the commission.
When they go through the home … they size up the house … and they size up the sellers.
If they find out that you have just started or are not willing to accept an offer, they won’t make one.
But… if they think you are ready to accept an offer … maybe getting desperate … they will then make an offer. But that offer is usually 10%, 20% or even 30% less than fair market value … because … that’s all they can afford … or … it’s all they are willing to pay. (Go to Win Lose)
90% Test
(Use this when the FISBO insists on continuing to try selling privately.)
A little while ago I said that 90% of all direct buyers are not qualified to buy the homes they look at. Let’s see how accurate I am. Here’s a test question for all potential buyers who call or come to your door next week:
Value of Time
Have you considered the value of your time? What could you earn if you weren’t busy selling privately?
What is it costing you in lost (sales, business, _______) while you are distracted with selling privately?
Win/Lose
If you win, you lose. If you find buyers and sell directly to them, statistically you will lose money. Statistically, owners lose three to five percent when selling their own homes directly to buyers rather than by selling through a real estate firm and paying the commissions. Here’s why:
1. The owner accepts less:
Direct buyers are usually bargain hunters looking for desperate sellers. Studies show that owners accept 5-10% less. Generally, serious buyers are willing to pay a fair price for the convenience
and security of dealing through a licensed real estate firm.
Anytime you … or I… or anyone … buys something where a salesperson or a firm is involved … we expect to pay a fair price. And anytime … you … or I … or anyone … buys something directly from
the owner … we automatically expect to pay less … isn’t that right?
2. The owner pays for all the advertising:
It’s quite easy to spend 1% of the value of the house in advertising.
3. It usually takes owners longer to get a sale:
Some sellers close on their new home or condo before the old one sells. Result? Extra taxes, interest, utilities, insurance, and maintenance. In the case of transfers, extra travel, and hotel or apartment rentals.
4. The owner often pays higher attorney fees:
If an attorney is involved when the house is sold through real estate, the attorney checks our work. When it’s sold by the owner - an attorney does the work.
When an attorney checks my work … it may take half an hour. But when an attorney does the work … it could take several hours … and you get billed accordingly.
Win/Lose Tie Down
Would you take 5% of the value of your home and send 2% or 3% or 4% to a complete stranger … as a gift… no strings attached?
Would you send 1% to the newspaper as a gift, no strings?
1% to the utility companies, no strings?
1% to an attorney, no strings?
If you sell your home yourself and net 5% less than if you sold it through a real estate firm and paid the commission, isn’t that exactly what you are doing?
Cake
How would you like to have your cake and eat it too? I will give you an exclusion on any direct buyer you find in the next (one or two) weeks. If you find your own buyer, you will owe me nothing. Additionally, that will give you some leverage to close a buyer. You can say that it is listed and if the buy before the exclusion period is up they can save some money. Fair enough?
Selling Privately
Selling privately is not the problem; getting full value is … and getting a timely sale may be.
Hot, Hot Market – Logic Check
If you felt that you had a good chance to net an extra $1,000 or (1%) in the next 10 days by having me represent you to sell your home, would you do so?
Hot, Hot Market – The Analogy
Do you have a watch?
(Ask to see the watch, and hold it in your hand.) (Alternate: Use your own watch.)
Let’s say that you paid $1,000 for this watch. Let’s also say that you stopped into your local jeweler and found another watch, somewhat similar, but with lots of diamonds. You want the new watch, but can’t justify having this one as well, so you ask the jeweler for a trade-in.
The jeweler says, “I know you paid $1,000 for this watch new, but the most I could get for it as a used watch would be about $500, and it could take several months to find a buyer. The most I can give you as a trade-in is about $300, maybe $330.”
Let’s say you check out two other jewelry stores and get the same story.
Now, suppose you tried to sell the watch at a garage sale, how much do you think you could get? Maybe $50 to $100 at most. Why? Because garage sales attract super-bargain hunters. They want to buy at 5% or 10% of new cost.
Suppose you put an ad in the paper reading, “Watch for sale by owner -$1,000 new.” How much do you think you could get? Probably a little more than the trade in, but less than the jeweler. Remember, someone could buy it from him for $500 and have the security of dealing with a going business.
Now, suppose we gave the watch to an auctioneer and there were 100 people present and the auctioneer got 15 or 20 people wanting the watch - how much do you think he could get? Probably $600 or $700, do you agree?
Hot, Hot Market – The Problem
The one thing I can do for you in this hot, hot market that you cannot do for yourself is to create an auction environment on your home. First, understand our current market. We have a lot of frustrated buyers and we have a lot of frustrated salespeople who cannot find homes for their buyers.
Every day appointments are made to see homes and then cancelled before the buyer can even see the home or present an offer.
Hot, Hot Market – The Solution
Now, here’s how we can get an extra $1,000 for you:
First, we pick the selling price you are most likely to get selling your home directly to a buyer. You must be honest here. If you inflate the price, the system won’t work.
Then, we add two things, $1,000 for you and my commission. That becomes the selling price.
Next, we schedule a week from Saturday for the day that buyers will be allowed to inspect your home. I need about 10 days to make sure that all of the salespeople who have buyers qualifying for your home have a chance to contact those buyers and make appointments.
I will schedule appointments for half hour intervals and let everyone know that you will accept all offers until 6 pm. Sunday evening at which time you will make a decision. If enough buyers see your home, and there should be plenty, you should have at least one or more full-price offers … which means you will make an extra $1,000 in less than two weeks.
Hot, Hot Market – The Close
Do you want to try it?
Important facts to consider when selling your home.
• 75% of ‘By-Owners’ list with a real estate agent once they experience the lack of qualified buyers.
• Most by-owners cannot not find a qualified direct buyer because —
Approximately 90% of all properties are currently listed by real estate firms.
Most serious buyers go directly to real estate firms or agents. Bargain hunters go to by-owners.
• NAR 2010: 88% of all homes sold through real estate, 9% sold privately 3% by other means; 4.5% to friends & relatives, only 4.5% on open market. However, that doesn’t mean they saved the commission because —
A ten year study showed private sellers sold for 9.5% less than those sold through real estate. Another study showed that on average, ‘by-owners’ selling directly to buyers lost 3% to 5% more than the real estate fee.
• On average it takes by-owners longer to find a direct buyer. Many by-owners have significant other costs because of the time lost. Finally, many ‘by-owners’ have little negotiating strength when an offer is finally made because they have run out of time and are under pressure to close.
• Of all real estate law suits a high percentage are between direct sellers and direct buyers.
(Only 10% of sales are between direct sellers and direct buyers, but some reports say they represent 50% of total suits.)
• Consider your negotiating strength if the first offer you get comes 90 days after your deadline … is 10% less than it should be … and your bank account is empty and your credit cards are full.
• When choosing an agent, be sure to choose a Sellers Agent with the special training to get faster sales and above average selling prices. Buyers Agents negotiate for the buyers. Sellers Agents negotiate for the sellers.
Single Greatest Advantage (SGA)
1- May I ask … what is the single … greatest … advantage … you would have … selling your home directly to … a buyer? (WFA) Save the commission … isn’t that right?
- May I ask … what is the single … greatest… advantage a buyer would have … in buying the home directly … from you? (WFA) His single greatest advantage is to save the same commission … you hope to save … isn’t that right?
- Is there any possible disadvantage … you would have … in continuing to try to sell your own home yourself? ADM
Advantage
In a negotiation, w ho has the advantage? You … with one home to sell … or the buyer … with multiple choices … and the money? Who has the advantage?
Calls and Offers
How long have you advertised your home for sale?
How many calls did you receive last week?
How many of those calls were from real estate people?
Of those not from real estate people, how many came out to see your home?
How many made an offer?
Do you know why no one made an offer? Do you want to know why?
(90% Not Qualified)
So no potential buyers called you last week, right?
Do you know why no one came out to see your home? Do you want to know why?
(Four Kinds)
My Calls v. Your Calls
Last week in our office, we had _____ calls from potential buyers … and you had _____?
