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559 S. Washington Ave., Kankakee,IL 60901

P.815.929.9258 P.815.929.9200

walter@waltersanford.com

Dear Walter, It was a pleasure meeting you during your recent event in Laguna Hills, CA. I appreciate the material your covered during the event and wanted to thank you for your generosity on gifting me the "Beating the Competition" sales system. Jose U. Jaramillo, Keller Williams

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Are You Thinking about Opening Your Own Place? December 9th, 2013 | Posted in General Real Estate, Real Estate

Recently, I was asked to answer some questions regarding an agent opening their own brokerage.  Below are the questions with my responses, which have been taken from my personal experience and my experience with my clients.

 

Question One:

What are the telltale signs that a REALTOR® should break out on his/her own and start a brokerage? What are the typical tipping points in these situations?

Answer One:

Square footage!  When there is need to add to the team or add infrastructure/technology but there is no place to put it, it’s time to move out on your own.  A team that is separated loses synergy.  If the broker cannot or will not add square footage, the agent may be forced to get his own.

Another area is lead generation.  Some of the teams that I coach are so effective in generating leads that occasionally there is spill-over to other agents in the office and leads are lost.  A destination without in-house competition is sometimes the answer.

Compensation is another area to consider.  Sometimes top agents already supply the services for themselves.  When that top agent crunches the numbers and adds up the total costs of splits, fees, and franchise costs – many times they find that that amount of money can pay the monthly mortgage payment on a building.

Sometimes a broker’s vision and goals differ so much from the top agent’s that there is dissention within the office. 

You need a change of business plan.  Working the pure commission life is hard!  Sometimes agents want a different business model that allows income from splits and fees so that they can get away from the daily business of one-on-one sellers/buyers.

Finally, sometimes a different management style necessitates a move.  Maybe an agent wants to provide a heavier training regimen or hold agents accountable, and he or she might find that easier to implement in a different environment. 

 

Question Two:

What are the first few steps that a REALTOR® should take when the points discussed in #1 above actually happen?

Answer Two:

A.      Find a location

B.       Prepare a budget — looking at all costs and applying the knowledge of previous abilities to bring in income.

C.      Make a list of all the marketing materials, phones, internet, and image changes.

D.      Decide whether this is going to be a secret move vs. a well-advertised move.  This usually depends on the relationship between the broker/owner and the vacating agent.  It also heavily depends on whether the broker has a reputation of allowing a vacating agent to keep his or her listings. 

 

Question Three:

Where do REALTORS® generally go wrong in these situations? What challenges do they encounter and how can they work through these issues?

Answer Three:

Bad mouthing by either party is not the way to go!  The management of the previous brokerage bad-mouthing the leaving agent and the leaving agent bad-mouthing their previous affiliation will not help anyone.  There is no reason to do either.  It only hurts the image of either or both parties.  The brokerage should be proud that they could provide the foundation for an agent to open their own business.  The leaving agent should be thankful the experience gained at the old brokerage. 

If the broker supports your moving on, then full disclosure of the move is the best way to go.  Another item of contention is that the vacating agent should initially look to recruit new agents from other companies, rather than the one they are leaving. 

 

Question Four:

Do you find that REALTORS® tend to jump the gun in these situations and perhaps not think through what it really takes to run their own brokerage?

Answer Four:

No, since most of the great agents want to stretch their wings.  They were successful agents because their planning and coaching allowed them to move to the new endeavor.  If there was a problem, it would be underestimating the costs of having your own brokerage.

 

Question Five:

What other advice would you give a reader who is thinking about this right now?

Answer Five:

The concept of the broker trying to keep listings or charge higher splits during a transition time will cause innumerable problems.  Letting great people do their own thing is the gracious thing to do. 

I hope this helps you make the important decisions involving opening your own brokerage.  Doing so means you are opening a new type of business.  You will be taking much time away from personal production and the other challenges while trying to live off of other agents in your new office.  We have coached many top producers and their teams through this year long process.  Good luck in your planning!

 

Walter Sanford has been designing and implementing real estate systems for 30 years.  One of the most successful REALTORS® and now wealthy from his systems, Sanford teaches his systems and strategies through his products, seminars, and personal coaching producing the best results in the industry.  Do what works, do what is proven.  Hire Walter Sanford.  Call our office at 800.792.5837, email walter@waltersanford.com, or chat with us online at www.waltersanford.com.

The Orphaned Client System November 14th, 2013 | Posted in General Real Estate

Agents are always leaving the business no matter if the market is great or rotten.  In great markets, they leave because they move or retire.  In rotten markets, they leave because they were never trained or they do not have the motivation to find the systems necessary for a tough market.  Great markets make mediocre agents look great; in fact, great markets can even make mediocre agents profitable.  It is only about eighteen months into a tough market that we find some of the mediocre agents do not have the necessary tools to create the needed activity to run a real estate business, whether as an individual agent or a whole office.  These mediocre agents, of course, blame it on the market and fail to look around at other agents who are actively creating income by solving client’s needs no matter how bad the market gets.  This phenomenon is natural and realistic. It should be expected and a plan should be created to handle it.

In this article, we will review just one great system for agent turnover.  This system was one of the many responsible for increasing my net worth as a real estate agent.  Both systems took advantage of the opportunities left after a good agent leaves the market place. 

The orphaned client system is a fairly simple system.  Simply talk with your broker (at any point in your career).  Let him or her know that you are available to absorb the unsolicited clients that were left behind by a parting associate.  The broker’s job is always to grow and gain market share, therefore he or she should be willing to see one of their current agents spend the money and time to make sure the company client is kept happy and continues to do business with the firm. 

I must warn you that sometimes giving your broker this idea will allow him or her to implement the system! I have found this rarely happens as most brokers do not compete against their own real estate agents.  Please ask your broker to allow you access to all of the closed files of any of the agents who have left the firm.  Ask permission to transfer into your database the buyer and seller information from that agent.  Add these people to a separate database and start the solicitation process. 

The first solicitation should be by direct mail since you will find E-mail addresses are rare and sometimes phone numbers are frustrating.  Though the letter will be prepared by you, please ask your broker to sign it.  Here is the letter:

 

Date

Name

Address

City, ST  ZIP

Name:

My name is (insert broker’s name), and I am the broker/owner of (company name).  I have noticed in a past file that you were the (buyer/seller) of the property at (address).  The agent who handled this transaction no longer works for our firm, but we wanted to maintain the same high service standards that we are known for by our existing clientele.  I have taken the liberty of assigning one of our top agents to your account.  This agent, Walter Sanford, will be contacting you soon to make sure that your file is updated and all your needs are known to our office. 

We offer many services that you may not be aware including helping you with advice on when it is time to refinance a mortgage or offering you unique inventories of investment property that possibly no one else will show you.  We also have many services that clients utilize like our property tax reassessment service, free 48-hour phone value service, and introductions to team members and vendors you might find valuable in your ownership of real estate.

It is our goal to become a continued asset to your real estate making decisions and to develop a client for life.  If you have any questions in the meantime, please do not hesitate to contact Walter Sanford with (company name).  I have given him access to your file.  Once again, he will soon be calling to make sure your needs are updated.

Thank you for being a past client of (company name).

Sincerely,

Broker Name

Company Name

 

As you can see, we are trying to use the clout of the real estate broker to get your foot in the door to find out a client’s needs.  Once the phone call is made, the script is simple.  All you will be doing is reintroducing yourself, reminding them of the letter, and asking them if they have any needs in the next 24 months.  Furthermore, you will have an additional goal of updating their contact information and confirming that it will be okay for you to contact them on a regular basis.  This orphaned client concept was extremely valuable for the start of my original business. 

Our products have hundreds of these tested systems.  Go to www.waltersanford.com/shop to obtain your set of systems that will make you wealthy, if slowly implemented over the next months and years. 

Walter Sanford has been designing and implementing real estate systems for 30 years.  One of the most successful REALTORS® and now wealthy from his systems, Sanford teaches his systems and strategies through his products, seminars, and personal coaching producing the best results in the industry.  Do what works, do what is proven.  Hire Walter Sanford.  Call our office at 800.792.5837, email walter@waltersanford.com, or chat with us online at www.waltersanford.com.

 

What Are Some Habits of Low-Producing Agents? October 8th, 2013 | Posted in General Real Estate, Other Interests, Real Estate

  1. Signing up for expensive lead generation when they are not effective in following up on the leads — There are many sources of purchased leads, and a lack of good systems for turning those leads into business means little closed business.
  2. “Pop-Tart” activities in handling business — This is an activity of jumping up to handle urgent business rather than finishing profitable business.  A lack of time- blocking will cause an agent to put out fires rather than working on a proven plan.
  3. Taking stupid business — What is stupid business?  Under-motivated sellers and buyers are two sources.  Low producers disregard the warning signs on these two groups, because they do not have the systems to produce leads and need to prove they are busy.  The problem is agents actually lose money working with transactions that probably won’t close while hoping for success.
  4. Buyer house calls — Low producers jump at the chance to work with a buyer.  Top producers ask them buyers questions, get them pre-approved, have a meeting with them, and have them sign a buyer-brokerage agreement while making the buyer feel they are receiving the best service available.
  5. Not being able to walk from sellers who have no reason to participate in this market
  6. Working with buyers who have both minimal credit and minimal down payments
  7. Working short sale clients who have second mortgages that are not with the same party as the first and also where there is not enough money to pay the first
  8. Going into a short sale where the buyer will not pay for an appraisal and inspection, prior to approval
  9. Taking too long to start lead generation — Just go out and knock on some expired doors…this morning. 
  10. Dealing with inexpensive properties — Start generating leads of more expensive listings today.
  11. Having REALTORS® as the major component of your sphere — It’s time to get out in the real world. 
  12. Have an assistant that only gives assistance — My past assistants and those of my coaching clients generate leads. 
  13. Setting up elaborate systems to stay in touch with class “B” buyers and sellers — There are enough “A’s” to keep you busy.
  14. Spending too much time on social media — Social media is one of the most overrated activities in real estate.
  15. Having a website that specializes in buyers rather than sellers
  16. Waiting for market changes — Forget the market and get seller leads.  You make the change today.
  17. Keep staging in your pocket until it is asked for by a client
  18. Waiting for the buyer to do an inspection after they write a contract — Get the seller to do an inspection right after they list the property. 
  19. Having so little business that they cannot walk away from a bad deal, bad situation, or an unreasonable client in a nice way
  20. Writing loose counter offers
  21. Not keeping the pipeline full
  22. Not handling the big problems early in the morning
  23. Not working enough
  24. Not spending enough time talking with or seeing clients
  25. Having a mentor who did not sell a lot of real estate.

 

There are many more, but let’s start considering these first.  We have systems that help with these and out right replace most of these habits.  We would be honored if you became involved with us by obtaining our training systems, attending our seminars in your area, or considering personal coaching. 

We have systems that help with these and out right replace most of these habits.  We would be honored if you became involved with us by obtaining our training systems, attending our seminars in your area, or considering personal coaching. 

Walter Sanford has been designing and implementing real estate systems for 30 years.  One of the most successful REALTORS® and now wealthy from his systems, Sanford teaches his systems and strategies through his products, seminars, and personal coaching producing the best results in the industry.  Do what works, do what is proven.  Hire Walter Sanford.  Call our office at 800.792.5837, email walter@waltersanford.com, or chat with us online at www.waltersanford.com.

 

A Common Request from a New Investor July 31st, 2013 | Posted in General Real Estate

Many have watched how I used my real estate career as a stepping stone into my real estate investing business.  To this day, I still purchase properties so the tenants can amortize the loan with no out of pocket cost to me after taxes.  I am able to hold on during the bad times and cash flow with equity increases in the good times. 

Below are some questions from a real estate investor who is just beginning and my response to his questions:

Question:

Hi, Walter!  I’ve purchased your products in the past.  My question is in regards to buying investment properties for our own retirement. Starting from scratch, would you invest in SFR, Condos, 1 to 4 units, 5 units and above? Would you stay away from HOA’s or does that matter to you? Commercial property?

Also, I live in Southern California and prices are high…and getting higher.  Would you invest in another state and have someone manage it for you or keep your investments near you?  Thanks for your advice, it’s always been helpful.

 

Answer:

I don’t care so much as to the vehicle.  On the bad side, condos have H.O. dues, 5 or more units have less advantageous financing, and commercial has a propensity for higher vacancy factors.  That being said — price is the great equalizer. 

I currently own (and have done so for decades) all the types of property you mention.  They all serve me well as retirement vehicles.  I want you to invest where you can touch your property.  Lower prices say in Nevada or Arizona are equalized by higher management costs, less personal involvement, and less knowledge in the development of the deal.  Find a fantastic value locally.  They are all around you.  Make a lot of offers! 

In California, I used a simple qualifier to determine if I wanted to look at an investment property.  I would have to be able to live there and monthly rent had to be at 1% of sales price.  The deals are going fast, hurry before the fixed interest rates go up again!

It is not that hard when you take the “flipping” mentality out of the picture.  Buy a business that is your business while you are doing your business. Live off of it when you quit your real estate brokerage business. 

 

Walter Sanford has been designing and implementing real estate systems for 30 years.  One of the most successful REALTORS® and now wealthy from his systems, Sanford teaches his systems and strategies through his products, seminars, and personal coaching producing the best results in the industry.  Do what works, do what is proven.  Hire Walter Sanford.  Call our office at 800.792.5837, email walter@waltersanford.com, or chat with us online at www.waltersanford.com.

 

The Question You Might Be Getting All the Time Now December 2nd, 2009 | Posted in General Real Estate

Here is an Email exchange between a coaching client and myself. I have a feeling that you’ve found yourself in this similar situation, too.

Question One:
Hi, Walter! You did a great job at the seminar on Wednesday. It was very entertaining, and it was good for me to hear everything again. It’s so much information it really takes a while to digest and implement.

Point me to a good argument in your books for a seller who really wants to move up but can’t get past the hit they’re taking on the sale price of their home. I know the goal is to help them focus on getting to the new home, which they can get for cheap, but I need to learn how to get past the part where they get stuck on the sale price of their current home.

Thanks!
Laura

Answer One:
Nothing that I know about in the books, so, are they buying up or down in price?

Question Two:
They are going up in price. They want more rooms, square footage. They just had one baby, and they might have another.

Answer Two:
Here is the thought. Move from $800,000 home that has had a 20% hit. Sorry you lost 160,000, but I have good news for you, you are actually ahead of where you would be when the property was worth 800,000.

You see, the 1,500,000 home you really want has dropped at a larger percentage because the higher end has had even less activity. So that house has had a 25% discount. That means you are going to buy your dream home at a 375,000 discount. That means that you are ahead 215,000 dollars over your same position in 2006.

However, there is one more concern that I have. We have a government that is spending more than ever before in history. They are spending money they do not have. Printing money and borrowing money puts pressure on interest rates. You will have a larger mortgage than you do now, so moving now, getting that large discount and tying down a fixed loan before they go the price of the Carter Administration make this move a time is of the essence matter.



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