Confidence in real estate is key to both making a positive first impression and building (and maintaining) trust with your clients.
Your confidence will determine your success in acquiring listings, in gaining buyers, in securing signed-around purchase agreements, and in taking your transactions from agreement to closing.
How do you gain confidence in real estate?
You gain confidence in two ways:
- By knowing your job, and knowing that you know
- By being well-organized and prepared
Whether you’re sure of yourself or not, your prospects and clients will know, and their trust in you will be affected. Sure, there are those people who pretend well, but their bad and/or inconsistent statements and advice soon uncover the lie.
Many established agents have confidence in real estate gained through experience.
But sadly, that confidence can sometimes be unwarranted. I recall a situation years ago when all the agencies in our small town went together to rent the current continuing education tapes. We met at different agents’ homes to watch and discuss the tapes.
There was one “old” broker who came to the first meeting, then decided he didn’t need to bother with the rest because he “already knew” all of that. Guess who was the only one to flunk the exam?
Experience counts, but only when combined with ongoing education. Real estate doesn’t stay the same from year to year – and right now, even from month to month.
Ongoing education – both formal and personal – is vital.
To maintain confidence, you must stay on top of changes in:
- Real estate forms
- Real estate laws and regulations
- Your local market
- Mortgage interest rates
- Mortgage programs, including available down payment assistance
It should go without saying that you need to know your forms and the relevant laws/regulations inside out.
When a buyer or seller asks a question about the meaning of a paragraph on a listing form or a purchase agreement, you should be able to answer immediately. When they want to know about all the disclosures, you should be able to explain why they’re required.
In addition, you should be able to answer questions about zoning regulations in your territory, and laws that might affect their purchase or sale. If your focus is on condos or residences subject to an HOA, you should know their rules as well.
Think about how you’d feel if you went to an accountant or a lawyer and they gave vague answers to your questions. Would you have confidence in their abilities? Would you want to hire them?
Next, know your market.
In last week’s post we talked about which potential sellers to target, and that’s important.
But even when you choose the right prospects, you’ll need confidence in yourself if you want to show them why you are the agent they should entrust to help them.
Being able to answer their questions about the market will go a long way toward that, so study your market consistently, watch the interest rates, and talk with trusted lenders to learn about loan programs and down payment assistance.
The real estate industry is in the news, and the news may be misleading your prospects.
For one thing, national news never reveals that individual markets may be very different from the national picture.
Are prices really falling? Yes, in some markets. No, in other markets. And of course, the definition of falling varies from speaker to speaker.
Think of government-speak. When they talk about reducing budgets, they don’t mean reducing. They mean not raising as much as they intended / wanted.
I’ve seen this in real estate as well. Instead of rising 10%, prices went up 6%. So to some, that means they’re falling. And when they talk about rising and falling, do they mean year-over-year or month-over-month? You need to know.
The definition of “prices” is also subject to interpretation.
Do they mean listing prices or sold prices? When the market was red hot, sold prices might be higher than list. Now, at least in some markets, sold prices might be lower than list.
If you want to have confidence in real estate, you need to be able to give prospects the true picture.
To do so, pay close attention to listing prices, selling prices, and days on the market. Create a spreadsheet, so you can show prospects how your market is changing – if it is changing.
You might even create a market analysis of a typical house in your target market and update it every 2 to 4 weeks, depending on how quickly changes are happening. Use the latest comps to make the updates.
Being able to say “this is what’s happening” will give you far more confidence than making vague statements.
The current conundrum…
When prices were rising rapidly, buyers thought they needed to hurry up and find a home before they went even higher. Meanwhile, some sellers were waiting to see just how high they could go before they sold.
Now, at least in some markets, we see the opposite. Sellers may want to hurry in order to sell before they lose more equity. Buyers may want to wait, so they don’t pay more than the house might be worth in a few months.
The solution is to target the right sellers and give buyers the right message.
As we discussed last week, some people will list their homes because they have no choice. Selling is a need rather than a want. Those people should be the focus of your prospecting efforts.
Meanwhile, the message for buyers is that while prices may fall, interest rates can, and likely will, continue to climb. Rents will also climb. One agent told me last week that rental rates in his market have risen about 30% year-over-year.
Those buyers who can afford payments on a house right now should go for it, even if it isn’t their dream house. If they choose a fixed-rate mortgage they’ll be locked into the principal and interest payment, so it won’t go up. Meanwhile, they won’t be paying to buy a house for their landlord. Instead, they’ll be building equity in a home they can sell when the economic picture becomes brighter.
Show your buyers the facts with real numbers.
And as for the price… yes, if they wait a few months they might pay less. But if rates continue to rise, their monthly payment could be higher!
Just look at the difference:
- $300,000 at 6.5% = $1,896 per month
- $260,000 at 8% = $1907 per month
- $250,000 at 8.5% = $1922 per month
Try this kind of comparison with the average price of homes you typically sell, then show your buyers the result. Use a fast and easy mortgage calculator like the one you’ll find at Mortgage News Daily.
Gain confidence in real estate through organization and preparedness.
When you know that you know and have the facts to back it up, organize the information so that it is easily at your fingertips.
- Add your research to your listing presentations, so if there’s a number you don’t remember, you can find it at a glance.
- Make a list for yourself of the most common questions people ask about listing agreements or purchase offers, and memorize your answers.
- Do the same with questions about zoning or issues specific to your niche.
If you want confidence in real estate, dress appropriately.
Remember to dress professionally and appropriately for your climate, your market, and your plans for the day. (The woman who showed up in hopes of listing a friend’s home and 20 acres didn’t stand a chance when she got out of her car wearing a long skirt and 4” heels.)
I’ve seen agents working in clothes more suited to washing the car or going to the beach. And once I was in a real estate office at 10 a.m. and saw an agent in a hot pink, low-cut dress that looked far more suited to an evening night-clubbing. I doubt that any of those agents instilled confidence in their prospects or clients.
Allow yourself plenty of time to get to appointments.
If you show up looking harried and rushed, or if you show up late, you will not make a positive impression.
Leave early. Park a little way away and stop to gather your thoughts and prepare for a successful meeting. Then show up on time – or a minute early!
If an earlier client has taken too much time and you can’t help being late, call as soon as you know. Explain, apologize, and give your prospects the option to re-schedule if they also happen to be on a tight schedule. Remember to take a deep breath and put a smile on your face before you make that call.
One last thing…
Think positive thoughts and use positive self-talk.
Say things like “I’m off to get sellers’ signatures on a new listing” or “I’m helping a nice young couple find their home today.” Do not allow yourself to think that they won’t like you, or won’t like any of the houses, or won’t be ready to act.
If you’re mailing prospecting letters, say something like “I’m sending away for solid new prospects today.”
Plan on things going well, because quite often we get what we expect.