Market Heading South?

Keep winning business by reaching into your bag of basics.

June 1, 2001

For years, real estate markets have been riding high on what many called the “wealth effect.” Consumers, feeling good about their swelling stock portfolios, were willing to spend almost anything to get the home of their dreams.

Now economists are starting to talk about the “poverty effect.” Those same consumers, having suffered through the humbling downturn in stock prices, are getting skittish about spending money. Although the housing market still looks strong, the frenzy has all but disappeared.

For a good salesperson, the end of the hot market is actually good news. Good salespeople know that, even as their competition struggles, they can survive and thrive in any market. Their secret: They never give up on the basics.

It sounds easy, right?

But it’s often the seasoned salesperson’s biggest challenge. A rookie has no problem jumping in and prospecting with a hopeful and enthusiastic attitude. New salespeople realize that since they don’t exist in the minds of prospective customers, they’d better get the word out fast.

But success can spoil a person. Even the rich and famous can lose it all if they forget how to practice the early habits that helped them succeed.

So here’s a prescription bound to protect you from the wear and tear of changing market conditions.

  • Be willing. Don’t fall back on your past: "I’m a pro. My reputation precedes me. Why should I work for FSBOs or hold open houses? That’s for rookies."
  • Start thinking that way and you can kiss your existence in this business good-bye. You never outgrow the basics, so get to work now.
  • Don’t rely on one or two niches to carry you through changing markets. Prospect all eight niches: past customers, open houses, FSBOs and expireds, social centers of influence, local business network, past-life acquaintances (for example, college chums), introductory calls, and a farm area.
  • Devote a minimum of two hours a day to prospecting. You can diversify. Maybe Tuesday and Thursday you work on FSBOs. Friday and Saturday you might call past customers. Wednesdays and Sundays you reserve for open houses.
  • Develop commonsense scripts to influence prospects in changing markets. One of the most important basics of selling is knowing how to sell consumers on the benefits of the market regardless of the current conditions.
  • For example, when interest rates are falling, prices often escalate. Explain the cycle to the motivated but hesitant buyer: “Every market has its pros and cons. If you wait for prices to come down, you’ll probably take the payment hit in rising interest rates. So if you truly want to invest in a home, do it now and concentrate on what’s right about buying now--the lowest interest rates available in the past decade.”

When interest rates are rising, this might be your script: “In a higher-interest-rate market, you usually have a selection of properties that are well priced and owned by motivated sellers. So take advantage of the increase in inventory. In the long run, you’ll get as good a return on your investment as on a modest savings account, plus you’ll enjoy being a homeowner.”

Be creative and confident. Find out what’s right about buying or selling in every market condition. Then present prospects with truthful, cut-to-the-chase reasons that support a decision to go forward under current conditions.

Danielle Kennedy is a consultant and speaker on real estate sales and marketing topics. She is the author of three books, How to List and Sell Real Estate,Seven Figure Selling,and Workingmoms.calm: How Smart Women Balance Career and Family.

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