You may or may not have read the post recently about an agent who made the business decision to NOT take clients unless they were cash clients at a certain price point. I read it, and it's been weighing on my mind since I read it. And I've decided to share my opinion on the subject and maybe give you a little food for thought as well.
Do you remember what you were doing on the morning of September 11, 2001? I do. I was watching the news at my office when they broke in an reported a plane had hit one of the twin towers in New York. I saw the second plane hit. Now I want you think about something for just a minute. Do you know what the average salary of the people working in those building that day was? Now consider the average salary of those who were running into those building that day?
Among us the lowest salaried people are often firefighters, law enforcement officers and those who teach our children at school. Is that really the clients you don't want to take?
Yes, I am certainly aware that when you take on a client with little or no savings who wants to purchase a home within their payment range that you end up working harder for much less money. But let me tell you about two deals I had this year.
Deal # 1- The purchaser is buying a foreclosure in a gated community. He was ready to make the offer on this foreclosure the minute it hit the market. It was in a gated community and he offered more than list price because he really wanted the home and did not want to be out bid. He's an executive with a company that if I mentioned the name there is not a person in the Western hemisphere would not recognize. Yeah, client is getting the house. It's more than $700,000. Oh and this will be a weekend get-a-way for this purchaser. I may come back and edit to include the actual sales price but you see it's actually closing Monday morning, so it's not yet a matter of public record and I don't want to compromise the bank's bargaining position in the event the closing isn't funded.
Deal # 2- The purchaser bought a doublewide manufactured home that was a Freddie Mac foreclosure with title issues. It took place last spring. I showed the same house to the father, then the step mom, then the buyers, then the father's brother in law (who happens to be a contractor), then to the entire family again. I negotiated long and hard on behalf of my client. It was difficult. I had to fight tooth and nail with Freddie Mac to get the title to the manufactured home. Sellers' attorney mailed the wrong deed, closing was delayed for days. Then the state erroneously mailed sales tax demands to the client for the manufactured home and I had to pull copies of the contract, the deeds, the tax records and fax to the state showing that my client did NOT in fact owe any sales tax on his property purchase. The sales price was $18,000.
Obviously Deal # 1 will be more financially beneficial to my bank account.
But Deal # 2 where I helped a firefighter and his family (wife and three children) get their first home, much more rewarding. It really FELT GOOD to help this family get into a home.
Yes, this business is how I make my living. I have a home with a mortgage, 3 children in college, two car notes, I need to make money to survive. But I didn't get into this business JUST for the money. I am a real estate broker because I find this business so personally rewarding. I get such a kick out of helping someone find their dream home.
And guess what? That firefighter has parents who live on the lake, guess who sold them their house? And if I'd turned down the business because of price point... do you think I'd have sold his parents a lake house? And someday in the future that firefighter may want to sell this house and "move up" and I wonder who he will call? I worked hard for him and I know he wouldn't hesitate to recommend me. He knows how hard I worked for him and he knows I did it because I care.
So think about what kind of clients you are cutting off if you use a "price point" cut off in your business plan. It could be that you are cutting off your nose (future business & referrals) to spite your face.
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