Since the postings of parts I and II we've seen quite a ride in the market. Most notable, the failure of the first "bailout bill" which caused a big drop in the the DJIA; somewhere in the neighborhood of 770 points.
As a result of this news a buyer that brought me a terrific offer backed out, citing the uncertainty in the market. What was also relayed to me was that the buyer's friends and family had some input which might of swayed their decision. Now, we've all had situations were the parents or friends or relatives either intentionally or inadvertently caused a buyer to change their mind so I wasn't too disappointed by this. What was disappointing was the fear caused by the media's portrayal of the situation.
Now, no one in the industry would deny that there are some serious problems out there. We're seeing lenders tighten their requirements (which is what they should've been doing all along) and down payments will need to be a bit larger. What I think might have contributed to this offer being rescinded may have been, to a lesser degree, the lack of experience of the buyer's agent. I say this because I spoke at length with the buyer's agent trying to glean some information about who the buyer is and their motivation. I also wanted to know more about the agent herself, as experience matters more and more.
She was new to the business, with only about a year or so under her belt. With newer agents I find that sometimes they may not have the confidence to thoroughly vet their clients or ask the right questions when determining motivation. Sometimes its a lack of knowledge of the real-estate tools we use to show our clients the value of a home based on its location, neighborhood, etc. Also, many newer agents simply do not know how to overcome objections and simply take their client's answer as the final word.
Whatever the case is, I feel bad for her knowing how hard she must have worked showing properties to this young couple (the agent also divulged to me that she had several children of her own, so the time spent with her buyers away from her family is probably now viewed as a waste). During my time conversing with her I thought she was really terrific and very responsive which means she'll have a bright future in real estate.
Hopefully, there will be a light at the end of the tunnel for her with these clients; sometimes it just takes a little perseverance with buyers in order for them to overcome their and commit to a purchase. So, I've put a short list together for agents working with buyers with objections.
1. Are their objections rational or irrational? This may give you a clue as to their motivation.
2. Don't expect them to buy a house the first time out or after your first meeting. It may take several showings and re-showings before they compile a list of their favorites.
3. If they put an offer together and then back out, try to meet with them as soon as possible to discuss. The idea is not to twist their arm but rather to show them that you are there for them. Sometimes this simple act can allay their fears and help them avoid making decisions based on hearsay that friends and family can do.
4. Ask another experienced agent how they would handle the situation. Or your broker/manager. Afterall, that's what they're there for.
5. Present your offer with your buyer directly to the listing agent in person. We need to move back to the time in real estate where things were really about personal service and face-to-face business.
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