Residential Real Estate
Down Payment Gifts: The Kiss of Death
You’ve earned a buyer’s trust and helped him find the right house. You’re ready to write up the offer. Before putting pen to paper, however, the buyer turns to you and says he’d like his parents to see the house first. How does that make you feel? Are you excited? Agents tell me this extra approval is the “kiss of death” for the transaction. It happened to me on what would have been one of my best sales at the time: a million and a quarter of sales down the drain simply because I failed to ask the buyers the right question. Think about Johnny, the buyer. Why has he decided to buy this house and not the other homes you’ve shown him? He picked that house because you’ve taught him the market. Once buyers have seen enough similar properties with you or more recently on the Internet, they learn to recognize a good value. The house seems to be priced well so they decide to make an offer. When Johnny calls his parents so they can check out the house, have they ever done this before? Do they know the market? Have they seen enough properties in the last few weeks to recognize value? Not usually. So they visit the property. They meet you, wonder whether their son should trust you, and promptly decide the house isn’t good enough for their Johnny. Who’s Johnny going to listen to -- you or his parents? The deal’s dead. The transaction died because we made a mistake. When we first met with the buyer, we didn’t ask that most important of questions: Will anyone be helping you buy the house? If you begin your relationship by asking this critical question, know what to do if the buyer responds that there is someone who will be helping out. Follow up with: Would they like to see some homes? In the situation with Johnny, Mom and Dad need to visit and tour properties with you. Can it be a logistical challenge? Absolutely, but the point is to avoid the inevitable kiss of death. When Mom and Dad first come to town, be sure to show them everything that fits Johnny’s criteria. They need to see that house that smells of cat urine with the ugly carpet. They must tour the property next to the railroad yard and the one on the busy highway. Given the changes in U.S. demographics, asking whether anyone is helping the buyer is even more significant than it has been in the past. Consider that according to Laurie Moore-Moore at REAL Trends, between now and 2005: 2,000,000 adults will inherit an average of $189,000 each. 100,000 new millionaire households will be created through inheritance. Family wealth has begun to flow down from generation to generation. Consider also that: One in four (28%) of first-time buyers depend on financial gifts to help them when buying. So the question to ask is: Will anyone be helping you buy the house? When Mom and Dad, the grandparents, children, friends, aunts and uncles or whoever else is helping the buyer out returns to inspect the home Johnny wants to buy, they will know he could have done much worse. You become the hero helping their Johnny rather than a goat with nothing to show for your efforts. As a professional serving your buyer in the best manner possible, you now only need to find the perfect house once.singapore florist commented:
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20.03.2012
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18.04.2012