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CONTACT WALTER

559 S. Washington Ave., Kankakee,IL 60901

P.815.929.9258 P.815.929.9200

walter@waltersanford.com

"Thank you so much for your spectacular presentation at our event last week! Your energy level and knowledge are what made it a very successful event for us!" Sue Woodard, CTX Mortgage

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Ask Wally – The Commission Negotiation Question November 10th, 2020 | Posted in General Real Estate, Other Interests, Real Estate

Every day I get a a request on how to handle commission negotiations. Here is the thread between one of my coaching clients and their seller/buyer. I first offer some advice on how to handle a the offer next time and then tell my coaching client the reasons why he can not offer what the client is asking for. Many of you would cave in because this person is a volume client, maybe we will have to cave in. However, we are not going to cave until the client understands why we are his/her best choice. Everyone needs to spend more time protecting their commissions.

Question:

Here is an Email exchange between myself and a client. I’m not sure where to go next. Could you help me, coach?

From my client:

We haven’t finalized our decision. Since we will be buying in your market and we would like to use the same selling/buying agent, we want to get a lower REALTOR® price on the package. Can you propose any options?

My response to my client:

It’s good to hear from you! Here is what I can do for you: on the listing of your home, I will charge a commission of 6%, and on the purchase side, I will give you a 1% of the sale price credit at closing of your new home. I hope that this will work for you. I would love to represent you and help you make your move.

Let me know if I can answer any other questions. The time to list is now; the spring market has started. I have sold 18 properties so far this year, most of them within the last 6 weeks.

Talk to you soon!

From my client:

We also want a discount on the sold home. How about 0.75% on the sold home and 1% on the bought home? Checking the competition, there basically is 1 maybe 2 homes similar in style/price, so I think priced right, it should sell easily. Also a discount on the sale helps minimize the impact of taking a loss on the house. Additionally, we are both familiar with the internet and are very focused on what we want, so it should be easy for us to find a home (and less work for you).

Answer:

Next time, it is 6% on the sale with 1% on the sale being credited toward their down payment on the purchase, if they buy through you. You will actually give them a check at close of their new purchase for 1% of their sale. If you get both ends of the sale or the purchase, you will give them 1.5% and if you get both ends of both ends you will give 2% of the sales price of their listing.

Here’s my suggested response to your client:

I know you will be able to find someone that will give you more of their earnings than I will give you, but here are a few of things that you’ll also be bargaining for:

1. Carrying costs. I beat the days on market for the average real estate agent on the sale by ________ days.

2. List-to-sell ratio. In our area, the list-to-sell ratio for the Board of REALTORS® is 96%. Mine is 98% because of the marketing that I do. You will give up the 2%.

3. Average litigation rate for a seller or buyer. The current going rate is one for every 87 transactions. This is a National Association of REALTORS® statistic. Mine is one in every 433 transactions. Litigation is where clients really feel the pain of having a poor agent.

4. You will not be introduced to my secret, wholesale property list. This has saved my clients over 20% on a purchase.

5. You will not get the guaranteed customer service and return call guarantees. You have not experienced pain until you have unanswered anxiety.

There are many other differences as to why I do not cut my fees more; however, if you look at my overhead as compared to other commission cutters, you will find that I have a staff, which is necessary to provide the kind of service that you deserve.

Since I have retired from the speaking circuit, I have my systems (large books with software) that I was selling from the back of the room at about $1500.00.  These are my newest products and this package includes everything that I have ever done.  As a “pay it forward” opportunity I am now selling these same books and software at my cost, about 94% off.  This is the start of your plan to get to the point where you are living the dream.  This is not anything but selling you the best real estate training materials in the world for 94% less than they were selling for a couple of weeks ago.  You will get 9 books, a whopping 40 pounds of checklists and information that is easy to use.  These volumes have been used by agents in the US and Canada to be the best agent in their market place. Go here to pick up your foundation for the future.

How to answer common objections… May 26th, 2020 | Posted in General Real Estate, Other Interests, Real Estate

In my seminars and even here through a blog format, I’ve been able to share some of my best ideas regarding seller leads, which will then result in buyer leads.  However, a lead is just that until it is actually memorialized in ink.  There can be a lot of objections between the discovery of a potential client and asking for their commitment.  I wanted to make sure that you are clear on answers to some of the most common objections.

One of the biggest problems comes in talking with a client for the first time.  Your only goal in the first phone call is to determine motivation and make an appointment.  When the client says, “But I will not pay a full commission!” then your answer should be, “I don’t know of any transactions I have handled that haven’t been completed because of commission.  What would be the most convenient time for us to meet so we can discuss how to increase your net proceeds and help you to achieve your goal of getting closer to the beach (or whatever their core goal of selling)?”

Put off all discussions regarding price, market, marketing, commissions, and anything else until you are able to take them through the best listing presentation, which is detailed in our product Beating the Competition Every Time.  This product will not only give you a video of my listing presentation, but it will also take you through the audio of why I do what I do.  Also included are the documents to use in the listing presentation in book and data CD format.

Occasionally, you might have objections prior to getting that appointment.  These objections come about whether it is a good or bad market, but unfortunately, you will find more of them when the sellers are not as excited about selling.  Here are some objections that my coaching clients have most recently received:

 

  1. “We are not going to sell any longer.”

“I understand, but may I please impose upon you for two more questions?  (wait for response)  What caused you to put the property on the market in the first place?  (wait for response)  What has changed about that?”

Obviously, if there is something that has changed to affect their motivation then putting the property back on the market again is a realistic objection.  If nothing has changed, let them know that you can provide a customized marketing plan to achieve their goals and try some new concepts that were most likely not presented on the first marketing effort.

 

  1. “We are just going to rent the property.”

This objection usually stops most real estate agents cold in their tracks.  The reason is because they often do not understand investment property.  Let’s cover some basics.

Most rental properties will have an approximate 40% expense factor.  This means that without considering the principle and interest payments, there will be taxes, insurance, maintenance, vacancy factor, utilities, advertising, and a myriad of other expenses.  If you are able to say to them, “Many of my clients have mentioned that, but once I show them the true net that they can expect in this market, many of them allow me to achieve their goals by way of a sale.  Would it be okay if I could show you the numbers you talk about when you mention renting?”

Your job is to simply show them the numbers.  First, you will need to come up with an agreeable market rent amount.  Next, deduct a 40% expense factor.  You will be deducting the principle and interest payment.  Add back the equity pay down portion of that payment.  Figure the amount of equity the client would receive on a sale using your services, and agree upon a safe amount of return, should it be delivered to their pocket.  This amount of lost opportunity cost on their equity is then once again deducted from the rental amount.

Explain the concepts of buying up in a down market that will motivate someone to make a purchase in an unforgiving market.  Subtract all those numbers from rent, and the negative can be substantial.

If the market is at the beginning stages of a down market, you can let them know that they might have a number of years with further deflation in their price.  Please don’t forget to mention that real estate markets don’t turn on a dime.  If they think it is going to get better next spring, what they are actually saying is the market might actually stop going down next spring.  Explain to them that it might take years for them to achieve the same price they could have had in the previous year.

Your job with any seller is to find their motivation and goals then create a customized marketing plan to achieve that goal.  Show them how expectations regarding renting may get in the way of achieving those goals.

 

  1. The next objection you will hear is some sort of a put-off for a certain amount of time, maybe because of a holiday, maybe they are not ready yet, or maybe they just want a break. These objections can usually be handled by asking when they want their goal to be accomplished.

By working backwards, you can let them know that an appointment might soon be appropriate.  For instance, if their property had expired in December, they might want to wait until March to put the property back on to give themselves a break and hit the hot spring market.

If you were to ask them when they would like to see their goal accomplished and property sold, they might say “End of the summer before the kids go back to school.”  By working backwards, you can make a case for the fact that they should be seeing you potentially “now.”  The reason for this is that many buyers buy with the purchase subject to the sale of their property.  A transaction like this could easily take 90 days, which takes us from September 1st back to June 1st.  The marketing time in many markets has been at least four to six months, taking you back to January 1st.  The remaining thirty days will be for designing the marketing materials, getting the house ready for the market, and designing the media mix.  The goal of any conversation with a motivated client is to obtain an appointment.

 

  1. “We are going to list with a family member or a friend.”

Regarding their listing with the same agent again, I believe that it is easy to overcome this objection by offering them a win-win situation.

You can offer them the following: “I can certainly understand loyalty.  Let me run an idea by you.  What if I was to present my marketing plan, discuss with you all of its benefits, and share why it has been so successful in the past with clients like you.  At that time, you can decide whether or not you believe my plan might be able to achieve your goal of getting you closer to the beach.  If you still believe that your previous agent has not done everything that they know how to do at this point, then you can stay with them and offer them any good ideas I bring to you.  The benefit is that you can go back to your previous agent with some new ideas.  I get to understand your motivation and see your property so that I can show it to any buyers should you choose to list with your previous agent.”

This will usually get you an appointment.  If your presentation is cutting edge, you will find that because you have counseled the sellers better then you will be showing up with better solutions, which usually leads to a commitment and a listing presentation.

Sometimes they just have a family or a friend in the business, and they would like to use his or her services.  In dealing with this concern, it is important to point out that in any business decision you want to maintain the reigns of control and the ability to hold an agent accountable.  Explain that sometimes it is hard to put pressure on a friend or family member to achieve their very important business goals of getting their new residence.

You can explain to them how important it might be to have an agent who would not be offended if the client/seller wanted to see different marketing priorities implemented in a different way.  They might still think that their friend or family member is the cat’s meow, but they might begin to see the advantage of having a real estate agent they can more aggressively control.  You can mention that based upon the stats over their family member or friend, the days on market, or the list-to-sale ratio just how this is a much better business decision as demonstrated in net proceeds or in time saved.

If this second reasoning does not affect them, then they must be extremely close to this friend or family member.  However, at this time, they might be thinking about the fact that you might be a better alternative, but they are trying to figure out how to save face with that friend or family member.

As a last alternative, you might consider to offer them a referral fee.  As unhappy as it makes me, that might be enough for the client to save face with the family or friend.  You could say something like this:

“I think that tonight we have brought to light the fact that possibly my marketing plan might achieve your goals in a shorter amount of time with higher net proceeds to you based upon the figures I have shown you.  I do understand the fact that blood is thicker than water.  How about I offer your friend/family member a 25% referral fee based upon my gross listing commission?  Therefore, they would receive the majority of their profit without spending any money or time on the project and more than likely would be netting you more results.”

It is always amusing when they bring up the fact that they will just take the 25% off the commission they pay, which means that you probably offered the referral fee too soon!

 

  1. A lead is either worthy of the trash can, a newsletter list database, a calendared call back date, listings in the “A” class, or maybe an immediate appointment.

If you have any objections that you cannot figure out, let me know.  I will be happy to give you a cutting edge answer so you can continue the conversation to achieve the client’s goals.

 

Since I have retired from the speaking circuit, I have my systems (large books with software) that I was selling from the back of the room at about $1500.00.  These are my newest products and this package includes everything that I have ever done.  As a “pay it forward” opportunity I am now selling these same books and software at my cost, about 94% off.  This is the start of your plan to get to the point where you are living the dream.  This is not anything but selling you the best real estate training materials in the world for 94% less than they were selling for a couple of weeks ago.  You will get 9 books, a whopping 40 pounds of checklists and information that is easy to use.  These volumes have been used by agents in the US and Canada to be the best agent in their market place.  Go here to pick up your foundation for the future.

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.

 

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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