Have you ever heard the phrase "Buyers Are Liars?" I am here to tell you that they are not liars! Buyers need us to discover their needs and wants. Most buyers also need our professional help, our guidance, and look to us to educate them.

Never Assume that Buyers...

1) Understand the local market. Most buyers believe what they hear. What they hear from other Realtors, from the media, and from friends and family. It is our job to educated them on the true local market conditions in their target area. We need to make them understand the AVG days on market, List to sale ratios, absorption rates and area pricing trends. Educate!

2) Understand Agency. Most buyers, especially first time home buyers do not understand agency. It always amazes me how some buyers find properties. They search online, gather listings, and then call the Listing agent to set up a showing. Most buyers are unaware of agency and do not understand the fiduciary duties of a Listing agent. It is your job to educate potential buyers on the importance of agency before they look for homes.

3) Understand How We Get Paid. Most buyers think they have to pay a buyers agent. In my area the seller always pays the buyers agent (unless the property is listed by a For Sale by owner, and no compensation is offered). I meet a lot of buyers for the first time and they always ask me what my fees are? Buyers are confused! Let buyers know that they do not pay you if the property is represented in the multiple listing service.  Make this clear in your marketing messages to buyers.

4) Understand Our Real Estate Contracts.  Most buyers do not understand our contracts. We sometimes assume that they understand real estate terminology, the purchase offer contracts, and all the addendum's / disclosures of the seller. It is our responsibility to explain the whole contract. This can be explained at the beginning of the buying process or once an offer is written.  Take the time to educate your client of the contract process. This will show professionalism and build trust through the whole process.

 5) Understand the Purpose of a Home Inspection.  Most buyers do not understand that the home inspection is a contingency to the contract if performed. This home inspection is for their protection. Most are unaware of how contingencies work, and that they need to remove their contingency or decide not to purchase the home. Some buyers think the purpose of the home inspection is to give the buyer the ability to negotiate again to get the home for less money. Of course this can happen, but it is usually not the purpose of a home inspection.

 6) Understand the Negotiation Process. Most buyers do not know how to negotiate and look to us to help them. Most first time homebuyers are unaware with how the process works. Most do not understand the market as most real estate professionals do. Most do not understand pricing trends in neighborhoods. Most do not understand that offering the wrong amount on a home can hurt them and not help them reach their goals. Most do not understand multiple offers or contingent and recall clauses. The buyer make the final decision, but it is our job to guide them by education and professional advice.

 7) Understand Their Legal Rights. Most buyers do not understand the legal aspect to real estate transactions. Instead of advising buyers of their legal rights, I always recommend that they hire a real estate attorney. Where I practice, there are three attorneys involved in the real estate transaction ( the sellers, buyers, and bank attorney) You can educate them to the roles of each, and elementary real estate law, but leave the legal advice to the professionals.

 8) Understand the Purpose of the Final Walk Through. Most buyers do not understand why a final walk through is necessary. I have found many issues with a property at the time of a final walk through that did not exist when the offer was made. Or, items were missing from the property that should have stayed in the home, such as a refrigerator. Moreover, items were left at the property that did not belong, such as paint cans, or furniture and debris.

9) Understand the Loan Process. Most Buyers that have never purchased a home do not uunderstand how the loan process works. I would recommend obtaining at least three mortgage professionals that you can recommend to buyers. Make sure that these mortgage professionals operate their business as you would. Their job is going to be to educate and explain the mortgage process to your buyers.

10) Understand Your Website, IDX, and How to Search for Homes. With 87% of buyers starting the process on the Internet, as agents we assume that these buyers understand real estate technology and how to process all this information. Think about it, most real estate agents do not understand this new technology. The shift in real estate to the Internet is a good thing, but also a bad thing if we do not make our websites user friendly and still provide guidance on how to search for homes online. Example:When I meet a new buyer for the first time, often the buyer is holding pages and pages of real estate printouts from the Internet. The reason for this is that buyers do not understand that they can obtain all this information from one source, rather than going to 10 different websites... Once I explain that I want to simplify their search and they no longer have to search on 10 different brokers websites, my clients can not thank me enough. Instead of terms such as "Search the MLS", use the phrase, "Search for Homes", or "Home Search" Most buyers do not know what MLS or IDX stands for.

 

This is only a short list on what buyers need our help on. We as an industry must understand that even though real estate has transformed into an open exchange of data and information, most buyers today need our help in processing this information. One step for all agents is to design a buyer packet or a simple checklist for the buyer client. Another suggestion would be to have email campaigns or video to explain the buying process to potential prospects on your search. Bottom line, educate your clients and you will be different than your competition!

For more information visit my website at http://www.CNYAgent.com or call 315-882-6610

 

 

 

119 Comments on Never Assume What Buyers Know!

20 Most Recent Comments Displayed Show All

NOV
10
2009
Outside Blog

Point well taken. Good post...

3:02pm • #100

Remember, "Don't Show Until You Know That They've Got The Dough!"  Always Pre Qualify your buyers and then show them property. You will know their real price range and not have to worry about them being able to get the loan.

 

Sam Coleman

Sr. Loan Officer

Home Loan Specialists, Inc.

samcredit@gmail.com

Sam Coleman
3:05pm • #101
163,202 Points 1 Featured Post

Sam,

Yes, you MUST qualify correctly before the appointment. This subject is one of my next blog posts... Qualifying the appointment... This is where buyers could lie Example: "Do you have a pre-approval?"Some buyers will tell you that they have a pre-approval when they do not... Many newer agents and struggling agents "JUMP" when a buyer wants to look at a home. Again, you must educate the buyer to why it is important to have a pre-approval, so they understand why you are asking them this question

3:13pm • #102
157,065 Points 8 Featured Posts Hit Router

Good point, not understanding the process doesn't make them a liar. Education on the homebuying process and protocols is a key duty of a good buyer's agent. -M

3:20pm • #103
1 Featured Post

Thanks for the reminder about why we are here to guide, help and educate....now if they would just listen :)

3:44pm • #104

Bob,

Thanks for the post. I do not like trite statements and agree that most of us when in a Buying mode may have an idea of what we want, it is our job as Agents to as you stated "discover" what it is that a Buyer Client is really looking for.

One other point I would make is that Buyers actually do pay our fee since it does effect & is based on commission from the sales price. I think that both the Buyer & the Seller ultimatly pay the fee. It is our job to earn & justify that fee.

Thanks,

Julie Keelan

Allen Tate Realtors

 

Julie Keelan
4:15pm • #105
239,241 Points 16 Featured Posts Attended Rain Camp Called Shot Master

you have very clearly laid out some very important points that should definitely be discussed when first meeting with a potential buyer to a) determine their level of "sophistication" and b) ensure that they understand that unless you bind them to an exclusive buyer's agency agreement, they need to "stick" with you irregardless of what other realtors might say at the open house that they visit without your knowledge. 

4:55pm • #106

Bob,

I completely agree with your post. It does a great job of laying out many of the things buyers need our help on. I would also state that we as an industry do a very poor job of communicating with our clients. Most of the time buyers don't know how to communicate what they want, haven't defined a specific need, or simply don't know what they don't know. We need to be better educated on how to do a comprehensive needs analysis that will help both buyer and agent understand their wants and needs.

This needs analysis is also a great time to build trust and rapport with a buyer. Until that happens, they will be guarded with their information (which leads us to feel they lied to us). Lastly, until we build that trust, we will never know what prior experiences our buyers have or the advice they receive from their trusted advisors.

When we take the extra time up front, everyone wins!

5:59pm • #107
1 Featured Post Outside Blog

Bob...this is so true.  I always hated that pat phrase- I felt it was disrespectful to the people we are in business to help. 

From hosting many open houses and working with lots of buyers over the last while, I do know that it is important to assess their level of knowledge with the process....(and do it in a way that is not condescending).  Most people think they understand the process - from talking to their uncle Bill who thought about getting his RE license in 1974 or from watching House Hunters on TV - but the reality is different. 

The purchase of a home is too big of a deal to assume that the buyers know what they are doing.  They rely upon us to be competetant educators and facilitators in the process.  You have hit upon some great points.  Nice work!!!

7:30pm • #108

Great Post -- I agree that buyers are not liars.  They simply don't know what they really want or how to get it.  Sometimes, they throw up shields to protect themselves from devious real estate salespeople as well.  I don't encourage my agents to get a buyer broker agreement on the first meeting for that reason.  The buyer must feel comfortable with the agent first, then be prepared to go the distance together -- learning along the way.  In my office, we talk alot about babysitting a deal or babysitting a buyer.  That's how we feel -- we care for and educate our buyers through the home buying experience and have lost very few buyers.

 

Thanks for reminding us that buyers need us to do our jobs as professionals.

Kelly Fisher
7:47pm • #109
163,202 Points 1 Featured Post

Thank you to all that commented on my post!

Great comments!

8:53pm • #110
122,675 Points 3 Featured Posts

Really great post.  One of the first phrases I learned in real estate was "buyers are liars".  You point out some important considerations that we need to be aware of.

9:43pm • #111
235,700 Points 4 Featured Posts Called Shot Master

This is a good reminder Bob. If everyone knew what we know, they would not need us. We need to explain these basics each time we have a new client.

10:37pm • #113
584,667 Points 105 Featured Posts Outside Blog Called Shot Master

I agree - buyers need to be educated. I do think some of them lie - because I've run into a few who did - but for the most part, they just don't know what they're doing!

(Assuming that none of them lie is like assuming that no one lies... and that's just not so.)

Everyone is different. Many people, in an effort not to look stupid, try to bluff their way through and not admit to what they don't know.Then it's your turn to educate without letting on that you know they don't know.

Other people are pretty defensive and can be down right belligerent in asserting their "knowledge" of real estate. (This is especially true of the parents of the buyers or sellers.)I expect this is a defense mechanism, used because their cousin George got burned by a real estate agent who lied! (Yep, some do.)

I think you're on the right track when creating hand-outs or videos. Then they can learn in privacy and not have to admit to you that they don't know! And those who admit they don't know, but do want to know, can study what you offer at their leisure rather than try to absorb it all while you're talking to them.

Good post - good ideas.

11:13pm • #114
1,348,414 Points 41 Featured Posts Outside Blog Attended Rain Camp Called Shot Master

I like the email campaign and video ideas to explain things to buyers.  Both buyers and sellers can be very confused about the process.

11:26pm • #115
NOV
11
2009
220,793 Points 4 Featured Posts Localism Sponsor

I learned many years ago assuming leads (most always) to unwanted implications.

7:57am • #116
129,999 Points

Bob - What a fabulous summary on how to educate our buyers.  I hate sweeping generalizations such as "Buyers are liars".  A few are fibbers, though...

8:14am • #117
2 Featured Posts Called Shot Master

Bob - great post - I love the ones that inspire so many comments. Education and trust - those are key - and sometimes it's hard to educate people if they don't trust you. But, to get them to trust you, you need to educate them. Little circle here. With trust, everything else can fall into place. When we have new situations come up in sale after sale - even after 20 years, they cannot possibly know everything involved.

I always thought the saying had more to do with them not really knowing what they wanted to buy. My experience was someone looking for a big 4 bedroom colonial, had to have it, etc then walked into a smaller ranch home, but near the water - fell in love and that was it . . .

Always great tips and ideas come from thought provoking posts - thank you.

12:35pm • #118
147,135 Points

Bob - Great post...I agree that education is number one.  Buyers coming into the market really have no idea how things work.  They've watched all the shows but real life can be considerably different.  Specially here on Long Island, NY.  The system here is not the same as it is across most of the country.  I think when you spend the time to educate buyers they begin to realize just how much they don't know.  Not only does that validate the benefits of a Realtor in general, it also shows the buyer how your knowledge and experience can help them.  Possibly leading to working for them as a buyer agent.

6:49pm • #119
NOV
15
2009

Great post!  We shouldn't put everyone in the same category... However, some Buyers/Sellers definitely do ... & yet many are straight with you.  This is a people business & our role is largely counseling & educating. ~JC

9:19pm • #120

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Bob McTague - Syracuse New York Real Estate

Syracuse, NY

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Coldwell Banker Prime Properties

Address: 6800 East Genesee Street, Fayetteville, NY, 13066

Office Phone: (315) 882-6610

Cell Phone: (315) 882-6610

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