5 Biggest Mistakes Agents Make!

Real estate has enough surprises and challenges - you don't need to create your own.  Self-inflicted agent damage can be solved with patience, education, and experience.  Even with top producers, the occasional snafu, while rare, still happens!  What follows are some of the biggest mistakes many realtors make in the selling of real estate.  It is my goal that you learn from others, because experience is a hard task master.  And keep in mind, they don't give out Purple Hearts for self-inflicted injuries!

1. Occupancy prior to closing

I know what you're thinking.  The client had to get in, the property was vacant, and the seller didn't care!  Why not be a client-pleasing agent and make it happen?  You can even cure the liability issue with a pre-occupancy agreement and make certain that all insurance is in place, but I guarantee you that you will only do this once in your career!  If you do it a second time, then you must enjoy pain.  When those new buyers move in prior to closing, they are at the height of their anxiety.  Buyers remorse is running rampant.  Mrs. Buyer is still mad at Mr. Buyer for not negotiating harder.  The lender is still calling for "just one more" piece of paper!  They are so grateful that you arranged that early occupancy but as they are moving in, they notice that the front concrete porch, once hidden with a mat, has a huge crack.  They didn't notice the discoloration on the walls until the pictures were removed.  How about that stain that was behind the seller's couch?  You're saying, "But all of these things would have been seen during a final walk through anyway?"

True, but these things only add to the fire when they discover that when three people are taking a shower at once the hot water pipes jiggle just before the hot water runs out.  They also discover that there is a draft through the master bedroom window, that there is an ever so small leak from the skylight, and that there is a gouge of plaster on the inside of the closet.  Normal wear and tear, enhanced by the buyer's anxiety and multiplied by the fact that they are currently living with it every minute until the close, combines with the fact that they have the ability to not bring in the money and documents to close.  What this involves for the agent is hours of negotiation, repairs, and probably a commissionectomy.  No resale house is perfect nor can any one expect it to be; however, when you enhance the presentation of problems and combine it with the buyer's ability to not attend the closing, you are only begging for pain.  You will find that it is certainly not worth that short lived client appreciation of early occupancy.  In my previous life as a Realtor, I had one personal experience - my buyers sold their home in another state.  They came into my office, they told me that they could not get the closing extended, and they had no place to live. I knew it was a mistake but I offered them my abilities for occupancy prior to closing.  After much negotiation and time spent, I negotiated a pre-occupancy agreement and obtained the keys for a Saturday move-in prior to a Thursday closing.  The batteries in the garage door opener were dead.  Every lock in the house had a different key!  The rain that week was incredible and the little yellow stain in the corner of the living room (that everyone had noticed) now became damp.  We called out the roofer who had previously made repairs and we found that for another $250, the work could be done correctly this time.  The carpet didn't go quite with the color of their living room couch and you've never seen more ants in one house!  Every day, from move-in to closing, I was negotiating price concessions, handymen visits, and warranty agreements much to the chagrin of everyone involved.  Instead of the whole experience being chalked up to "you gotta expect some problems with a used house, honey" it was "we want it perfect before we close!".  It only took one time for me to learn that final walk-throughs were okay but there will be no living with the challenges until close.

2. Not preparing for the busiest week of your career - the week before your vacation.

Yes, it's true!  REG, the real estate god, guarantees that the week before your vacation will be your busiest week ever!  More clients will call this week, more sellers will want to list, and more buyers will want to buy than at any time in your career!  Your anxiety grows as the date your vacation approaches and you start considering postponing it or cancelling it all together.  Not only will this cause resentment for the real estate business but it will also cause serious family problems!  Furthermore, if you ever do cancel your vacation, REG makes sure that those newly acquired clients will soon become the nightmares that we talked about in point number one.  Therefore, plan and understand that the time constraints will cause anxiety and that you will need help.  Make sure that you have enlisted the help of your manager, broker, and your best friend in the office.  They will take care of the files and they will do a great job!  Start setting up your "in house" office alliances now to make sure that you have a life!  If you want to go and increase your overhead, one of the greatest uses of an assistant is to make sure that the continuity of your small business maintains a level keel during your well-deserved time away.  Yes, you can have a life in real estate, but you have to plan for it.

3. Agents were not put on this planet to negotiate!

Very early in my real estate career, I was told by one of my mentors that your seller's highest priority may not be price.  They want their hopes, goals, and aspirations realized.  Buyers are not always interested in shaving off that last $3000; sometimes they're just interested in getting the home.  Over the years, I have seen hundreds of transactions lost by a real estate agent who had a client that truly wanted that home than I've seen that same agent deliver less than full price offers in the hopes of negotiating a few thousand dollars off the price.  I've then seen that offer rejected in favor of a better one.  I've even had buyers call me (as the listing agent) directly, bypassing their buyer's agent letting me know how badly they wanted the house and if they had known that they had a chance of losing the house than they would have offered more.  I have been in the unenviable position of having to tell them that it's too late.  I've even seen people cry.  When clients want to buy a home, their best chance of doing that is to make a full price or better offer.  When a seller wants to sell a home, their best chance is to accept the first offer.  Any deviation from these assumptions increases the chances of their goals not being met.  I'm not saying to accept ridiculous offers or make offers at above market value, but please take into consideration your client's needs.  A $1000 price difference over a 30-year mortgage on a $100,000 home will mean nothing to a client who loves the home.  A seller that wants to move closer to family in another state sometimes does not want to see a counter offer rejected and a buyer buy another home because you thought it would be a better idea if a higher 'net' could be squeezed.  Real estate agents make dreams come true and they should only become negotiators when it's in the client's best interest....not in the agent's ego or DNA.

4. If they are not motivated, you do not have clients.

As I move around the area, I see agents knocking themselves out with clients that have less than perfect motivation.  There isn't a worse mistake in the world than working for free, which we all do, for a client who has less than realistic motivation.  "I am testing the market.  I have plenty of time to look.  I have seen hundreds of properties and I don't like any of them.  All the sellers are crazy, I really don't have to buy."  These are comments from clients that have less than perfect motivation.  When you deal with clients who have lower motivation, you deal with individuals who have more time to complete a transaction - sometimes forever!  Since you work for free until closing, time is money!  However, there is something even more insidious at work.  If the client doesn't really need the fruits of your labor, then nothing that you do sometimes is good enough.  Therefore you are in a constant state of frustration with an unhappy client trying to achieve goals that are unclear.  The concept is simple.  A seller has to have a real reason to sell and a buyer has to have a real reason to buy. If they can not convince you of these things, please have your internal red flag go up and be wary about your investment of time.  I believe that the lack of pre-qualifying for motivation may be the largest mistake agents make in their career.

5. It's time to under-promise and over-deliver.

If the sign is going to be up in three days, tell them five.  If you're going to email them three pictures, please email them four.  If you're going to have them drive by six properties, give them a bonus seven.  If you're going to return the phone call in three days, make it two.  All agents want to please.  I know that I did - and this sometimes leads to promoting best case analyses.  It sets up a goal and expectation that are sometimes hard to achieve. One agent I know of makes sure that his affiliates, like his lender, give him a worst case analysis.  He says that if you're going to tell a client that we'll be receiving loan approval in three or four days and it takes two weeks, even though you have no control over the loan approval process, you're going to be a jerk!  So, therefore, please adopt the worst case analysis with consistently grim expectations.  I even went so far as to send all buyers and sellers, who were at the point of signing a contract to buy or sell a home, a list of every nightmare that I encountered in my years of real estate experience.  The reason I did this was that they would understand the amount of work that goes into closing a transaction and also to let them know that there are many ways in which a transaction can not come to fruition. This also let them know that they have chosen someone who has great experience in heading off these potential problems.  The concept was genius!  It not only let them know the amount of problems that were possible, but since most of these problems never happened, they believe that their affiliation with me was the reason for their good fortune.  You build perceived value by always outperforming your client's expectations.  You'll find the frustration level of your clients, and most importantly, yourself, will be severely reduced.

With a little thought and preparation, you can make your real estate career much more rewarding and less stressful.  The control is totally within your hands.

Just thought you should know.

Have a profitable day!

Steven