Presentation is everything when talking the numbers

[Jesse Brewer]

We live and work in a society and market that is always changing. The millennials are now buying their 1st (and even 2nd homes), investing in property and becoming the professional work force of today. This means the way we all do business, purchase property and communicate with each other has drastically changed and continues to change today and if you are in the business of selling homes or mortgages then you need to get with it or get out of the market.

I have heard several agents complain that their buyers lost out on a deal because buyer and seller couldn’t come to an agreement on price. Recently this happened to a good friend of mine who sells a lot of first time homes and she was telling me that her buyers would not come up from $102,000 to meet the seller’s demands of $106,000 and walked away from the deal. After listening to her tails of real estate woe I processed the information and asked her how did she present the information? At first she was puzzled then went on to tell me that she showed them the comps and that the property was worth well over $115,000 so they were not overpaying and that this house met all their “have to haves” and some of their “want to haves” in a home. It made sense for them to buy it at the $106k and she was right in that statement; however, where she failed to close the sale was how she presented the information.

She looked at me with a sense of confusion so I went on. I asked her “when was the last time you bought a car?” She told me it had been a couple years and then I asked if she financed it and she nodded. I then went on and asked her did she remember that process and how the salesman presented the information? They never discussed price of the car at all. Instead they focused on the monthly cash outlay. For example, if you were ok with spending $350 per month for the car and the salesman came back and said “I can get you in the car you want for $377.00 per month out the door chances are you didn’t focus on the price of the car but the $27 bucks per month and rationalized that as two lunches out per month, couple packs of smokes or maybe a round of drinks (depending on where you live) and chances are if you really wanted that car you would pull the trigger and spend the extra $27 per month. All the while what the salesman did was get you to increase the purchase price up on the car say an extra $1,500 bucks without you realizing it because you were focused on the monthly cash outlay.

I then went on and used her example of the purchase of the home. I suggested instead of focusing on going up $4,000 (because we all want a deal and we will be damned if we increase our offer because we see on TV all the time how people buy these houses on the cheap and why should we be suckers… WRONG). I proposed that she ask them if the house that meets all their wants, that is ideal for them (according to them) was worth paying an extra $20 dollars a month than they originally budgeted. This type of thinking stimulates a different part of the brain as now when presented this way you start to think “**** that’s only a lunch or two out a week, maybe a couple shots at the bar on Friday night or something along those lines and when you look at it in that context it makes it hard to pass up on the house you really want for just a couple shots of whiskey per month or lunch out occasionally.

This tactic isn’t something new and edge cutting. It’s been around for years just most real estate agents are not hip to it and let their deals fall apart because they are focused on the purchase price and comps, and while those things are important you need to also be prepared to go at your clients in a different way to make the decision that ultimately they will probably thank you for. So if you’re a real estate agent invest in a mortgage calculator app on your phone (most are probably free anyways I think) and have the conversation in a different text and watch more of your clients “sign on the line that is dotted.”