Find out what the market wants and deliver it to them
In a constrained market like the real estate market, how do you stand out or get your offers accepted? How do you avoid the dreaded “No” as an answer? And when having analytical people as your client, how do you use numbers as a way to influence their decisions? For Lance Dunn, the answer is easy and he shares it along with his CCC method on how to get your offer accepted right off the bat.
Real Estate Market Synopsis
Real estate has been a very constrained market in terms of available properties for sale. When there are not enough homes to sell and more buyers who want them but with a limited resource, the only thing that can happen is for prices to get driven up. That's exactly what's been going on. There are pending sales and the closed sales and new listings are all down in numbers year over year.
The median prices (for example) for January of 2021 over the year prices were up 20% for single-family homes and then another 10% this January of 2022 over the last year. For all of 2021, the rolled-up number for single-family home sales prices was an increase of 14 and a half percent.
That’s a double-digit increase. Those increases are expected to continue albeit at a more moderate rate. So instead of double-digit increases, there are more single-digit increases.
One of the reasons for that is buyer frustration and, increasing mortgage rates. The 30-year fixed mortgage rate right now is up to about 4.3%. It’s a point higher than it was about a year ago and at the lowest level of inventory recorded since 1999. It’s uncharted territory for quite some time and is expected to continue to stay there.
Best Realtor in Somerset, Hunterdon, Middlesex, Mercer, Warren, Morris County
Lance Dunn has been a real estate agent since 2013, and he’s always trying to sharpen his “pencil”. He’s always continuing to learn through reading, coaching programs, live and virtual training, and constantly always trying to make his processes better. Whenever he learns something new, he implements it or anytime right away.
A good example of how that has manifested is when one time, he was working with a buyer who was offering a home that was a renovated fix, investor fix, and flip. It was a very, very well done property and those types of homes have a lot of competition even in slow markets or what would be considered a “buyer's market,” where the buyers have the advantages as opposed to right now, where the sellers have the advantage.
His clients offered on this home and they were up against five other offers. The investor had a fix and flip and bought and sold and rented hundreds of properties in his career. When Lance presented the offer and the listing agent got back to him he was told that the client who reviewed his offer said, “Usually, I have a series of questions that I need to ask you or clarifying questions about the offer. But in this instance, I have no questions. I think everything's here. Is there anything I need to know that I don't already know from the offer?” And on that conversation, the agent replied “No, it's a really well, really well put together offer. I have high confidence that this is an offer that's going to get all the way through to the closing.”
The reason that's important is that not only did it get the offer accepted, but the offer got accepted even though it wasn't the highest one. In fact, it was the third from the highest, and it was $10,000 less than the highest offer.
What’s the reason it happened? It’s because they were able to convey a sense of certainty to the seller. That's one of the concepts that would be translatable to any other business. When you have a client, who's certain that your product is the best product for them, that's when you've got a buyer or client who's ready to make a decision.
So what is it that we need to do to move the needle for our clients?
According to Lance, in real estate, it's not necessarily about houses. It's just about the people. It's about what it is that they need. He believes he can't negotiate on his client's behalf if he’s not able to communicate clearly. Which is what makes it hard nowadays. People so much want to text, but Lance prefers to get on the phone and talk to the other agent or the other side of the transaction, find out what it is that they need, so he can put together a transaction that's going to be beneficial to everyone.
So what is it that gets offers accepted for in real estate?
- Terms of the contract
- Quality of the buyer
Lance taps into the emotions that make people feel certain that if he’s representing a buyer, he wants the seller to feel certain that his client's offer is the best one. If he’s talking to a client, who's looking to hire a real estate agent, he needs to make them feel certain that he is the best person to help them achieve their goal.
Know your client’s biggest WHY?
It's really about the WHY and not the what. For example, when somebody tells Lance that they want to move and they want a bigger house, that’s their what, but if he can find out their WHY, then he can better serve them. For example, they may want to have a larger house because their mom is having trouble taking care of herself and they don't want to put her in a nursing home. They want to bring her into their house and they need a bigger home. That's a really clear cut, WHY.
Another example in another industry is fitness. Some people are always saying, “I want to get in shape,” and that’s the what. If you ask WHY they want to get in shape? If the answer is “I have a bad heart. And if I don't get in shape, I won't live to meet my grandchildren.” That's a really big WHY. Knowing your client’s, WHY, and helping them stay in touch with that, is how you’re going to help them to their goal. It's all about emotion. It’s that logic makes people think, but it's the emotions that make them act. So people usually make emotional decisions and they support those decisions with logic.
Lance explains it's important to also understand that feeling itself is a form of thinking. This also works for analytical people too. They claim they don't make really big emotional-based decisions where in fact, they probably do. It's the numbers that make them feel good. The numbers in these statistics support the emotions that they're driving towards. For example, if Lance is working with analytical people, he'll say something like, “if I can deliver to you X, Y, Z result, or if I can get you that house that your mom can move into so that she doesn't have to go into a nursing home and the numbers work, would you be prepared to move forward with the purchase of this home?” That's how he taps into somebody who's more of an analytical person - knowing your client's motivation. Lance’s number one goal, when presenting an offer is getting people to feel good.
More importantly, what does it do? It avoids the dreaded default “No.” In any kind of decision making until the answer is a yes, it's a no. Dig deeper to find out what it is that's going to support a “Yes” answer for their decision. With people trying to purchase a home, the answer is always no, or somebody who's trying to sell a home the answer is always no until they know that they have the best buyer. If you're trying to buy a car, the answer is always no, until that's the best car for you.
Use CCC when preparing your product offer
Lance conveys this with CCC, which means:
Certainty that the buyer to the seller is the best buyer for them, or that your product is the best product for that client. Confidence in you, that you'll be there to get them through the process, or confidence that your product is going to be supported after they make the purchase. Clarity in your product offering that leaves nothing to the imagination.
So when putting together an offer, make sure that everything’s there that your clients need to know. Not a single piece is missing. Your clients will have the certainty that you are the best person around to deliver a product or a service. It's all about certainty because certainty feels good. So you do that by doing your homework on whatever process it is.
Know what everyone wants, then deliberate and assemble bombproof offers that leave absolutely nothing to the imagination.
A lot of things that are specifically for real estate can be applied to everybody's business. Many things apply because it's all about the customers. It's all about finding out their wants and needs and delivering to them whatever it is that they're after to fulfill that motivation that they're after
ABOUT LANCE DUNN
Lance Dunn has been a real estate agent since 2013, and he’s always trying to sharpen his skills by learning something new every day and implementing them right away. He helps both buyers and sellers navigate through complex transactions by taking the burden off of them, which helps make the process smooth and hassle-free for them.
Get to know Lance Dunn more!
- The Key to Getting the House that You Want
- Running out of space or moving to a smaller home?
- How To Get A Mortgage
- Helpful Advice When Selling or Buying Real Estate
- Downsizing Help For Seniors: The Best Company To Hire
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