Insulating Against A Law Suit

Generally most of my posts are adaptable to sales in any industry. Today I am specifically addressing real estate sales. If someone practices real estate very long, they will face legal issues; especially if they sell a lot of real estate. There is a very simple explanation for it too. It’s impossible to please everyone, and especially, if you represent both the buyer and the seller. In this type situation the buyer feels like the seller took advantage of them, while the seller feels like the buyer took advantage of them. As a Realtor® who is wedged between both parties thinking the agent showed partiality to the other party in the transaction. To complicate matters worse, in a typical real estate sales transaction there are numerous entities that have specific requirements and guidelines that must be followed.

Managing Your Risks

Generally most of my posts are adaptable to sales in any industry. Today I am specifically addressing real estate sales. If someone practices real estate very long, they will face legal issues; especially if they sell a lot of real estate. There is a very simple explanation for it too. It’s impossible to please everyone, and especially, if you represent both the buyer and the seller. In this type situation the buyer feels like the seller took advantage of them, while the seller feels like the buyer took advantage of them. As a Realtor® who is wedged between both parties thinking the agent showed partiality to the other party in the transaction. To complicate matters worse, in a typical real estate sales transaction there are numerous entities that have specific requirements and guidelines that must be followed.

In most real estate sale transactions there are two separate agencies involved. 

More times than not one agency will have the listing and represent the seller while the other agency will represent the buyer. [Read more…]

Selecting A Farm Area

Real estate is very territorial. Having a license to sell real estate in Alabama permits one to sell anywhere in the state but common sense tells us we can’t provide quality service from one end of the state to the other. A person can have license in multiple states but that doesn’t mean they can provide quality service from their home town. I live in an area that only a few miles separate Florida, Alabama and Mississippi. Some people hold a license in each of those states. You can’t sufficiently service a county, not even a city within a county.

Farming Works

I am referring to a territory that a sales person will work within the boundary. This is considered their farm. Let’s narrow the field and focus on real estate sales. Farming is an older and more complete term for prospecting for new clients to work with. A few years ago the term “Prospecting” was replaced with the term “Lead Generating.” These two terms don’t encompass near as much as “Farming.”

Real estate is very territorial. Having a license to sell real estate in Alabama permits one to sell anywhere in the state but common sense tells us we can’t provide quality service from one end of the state to the other. A person can have license in multiple states but that doesn’t mean they can provide quality service from their home town. I live in an area that only a few miles separate Florida, Alabama and Mississippi. Some people hold a license in each of those states. You can’t sufficiently service a county, not even a city within a county.

If a person really wants to be successful in selling real estate, they should select an area of a city, or a subdivision to be their territory. They are going to farm this territory by focusing all their efforts on this territory much like an agricultural farmer tends to his crops. When concentrating on a small area, one can make it a priority to learn everything about that particular area. [Read more…]

Pride of Ownership

You have a beautiful home!

You have a beautiful home!

Most people have some sense of pride in some or all aspects of their daily activities. Because of my religious upbringing, the passage in the bible referring to pride comes to mind.  I John 2:16 says, “For all that is in the world, the lust of the flesh, and the lust of the eyes, and the pride of life, is not of the Father, but is of the world.” I want us to examine pride of ownership as it relates to sales; specifically to real estate sales.

First let’s look at the important role that pride plays into a successful automobile sale. Auto sales people play on your pride from the time you drive on their lot. Why do we need all the extras; if it were not for pride? What if you went to an automobile dealership and told them you wanted to pay cash for a new car and the only extra you wanted was [Read more…]

Success by Association

Run Your Own Race

Run Your Own Race

As a real estate educator, I am often confronted by students that are completing their prelicense course. These students inquire about various real estate companies and especially the companies that are national franchises. They are inquisitive about the various payment plans, monthly desk fees, and if the company provides training. Naturally I am more than willing to share my knowledge with them and even advise them if they ask.

After giving them a short dissertation about the agencies in their area, I quickly suggest that most companies are all good agencies. That is they all have good people working there and they have good intentions of providing professional services and growing their business to a high level of success. In most cases when I am pushed to suggest one company over another, I explain that the company they choose is a matter of choice. It’s important for a new agent to understand that almost all agencies are good; some are just more professional than others.

I don’t mean to be copping out on giving these students a straight answer. I work with many different brokerages and almost all of the national franchises so I have must remain somewhat mutual and not show partiality one over another. [Read more…]

Sidetracked by the Holidays

Traditional Holiday Meal

Traditional Holiday Meal

This is the time of the year that sales people get sidetracked by all the holiday festivities and then when the holidays are over, they wonder what happened to their income.  Sale markets drastically respond differently to the holidays. Some markets thieve during the holidays while other markets seem to die. Real estate sales aren’t affected that much but those that are in the looking stage will most likely postpone looking until the holidays are over. With shopping to do, and parties to go to, there is hardly time to spare for talking to a real estate agent. Most real estate agents consider the holiday season as a viable excuse for not selling during this time of the year.  The more experienced, more successful agents view this time of the year as greatly improved opportunities to establish a meaningful relationship.

Have you ever noticed that people in general are much nicer, and friendlier from Thanksgiving through Christmas, and even New Year’s? I’m not sure why but during this time of the year, people seem to be more thoughtful of others and less quick to express their anger or short tempers. This is a perfect time for me to talk to new prospective buyers for the first time. They may be too busy for an extended conversation but they are in a very receptive mood for an introduction phone call. Such a call might sound something like this.

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What Consumers Need to Know When Buying Real Estate in Alabama

Don’t Be Afraid–Be Aware

Representation

First and foremost the consumer needs to know for sure that they have a qualified Realtor® to represent them whether they are buying or selling. Don’t take this relationship for granted; know for certain. Agency relationships that establish representation cannot be assumed or implied. They must be in writing. Let me explain a few reasons why the consumer needs to be represented by someone.

First, buying and selling real estate is very technical in the sense that certain processes must be completed and in a particular order. Buying and selling real estate is also very legalistic. Most real estate transactions close without any major complications either prior to, or after closing. It is the exceptions to that rule when the consumer finds out just how technical and legalistic real estate sales can be. After- market conflicts are seldom settled between buyers and sellers. Tempers flare, distrust and disbelief sets in, accusations are made toward everyone involved in the transaction. Finally law suits are filed to settle the dispute.

Law suits create a need for both parties to hire legal counsel. In preparation of the case it is determined that you the consumer, was not represented by the Realtor® that you worked with. At the time you began looking at homes you didn’t want to sign any type of contractual agreements. In this situation, according to Alabama law, the Realtor® was working as a Transaction Broker and was limited to the duties they could perform for you. A Transaction Broker is a licensee who assists one or more parties in a contemplated real estate transaction without being an agent or fiduciary or advocate for the interest of that party to a transaction. In order to have been represented in Alabama you would have had to sign a Single Agency Agreement with a brokerage firm. Remember, agency relationships can’t be assumed or implied. They must be in writing. After the fact is a bad time to learn that your best interest was not represented when you made the largest investment of a life-time.

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The 3-Foot Rule

Reach Out and Touch Someone

Given where I live you might jump to the conclusion that I’m referring to alligator hunting or something so I will clarify the topic quickly. The 3-foot rule is specifically for real estate sales people. It simply means that you should talk real estate to every person that comes within three-foot of you. I have also been teaching this technique to people in sales of other industries for many years, and I might say with great results. When it comes to sales, with any industry, sales people are always looking for some magic. They want to learn a technique or a method that produces huge results with little to no effort on their part. There is no such magic! However, the three-foot rule comes the closest.

There is such an enormous misunderstanding about real estate sales. There are no hidden secrets to selling real estate. Product knowledge is very helpful. It is even necessary to protect your client’s best financial interests but the most ignorant person can sell real estate. Whoa! Don’t misunderstand what I am saying. Experience and education is of most importance to the consumer when closing a sale but not when making a sale. You see, a house sells itself. A prospective buyer either likes a home and wants to own it of they don’t. It’s just that simple. If they don’t like it, the best of sales person in the world couldn’t sell it to them. The most difficult task a sales person has is marketing the property. That is finding someone to buy a property you have listed. [Read more…]

Real Estate Agents Aren’t Created Equal

Listen Intently

Conversations Include Listening

Please don’t jump to any strange conclusions by the title of this message. By no means do I discriminate against anyone. The key word in this title is “created.” People aren’t born with natural abilities perfectly aligning themselves to become real estate agents. A career in real estate is not nearly as appealing to children as becoming a policeman, fireman, pilot, astronaut, or to play for the NFL or NBA. For whatever reason we decided to get into real estate, the only similarities we have are the educational requirements and the fact that real estate sales people are licensed through their respective state. How and if we develop our career is an individual choice. The level we take our sales production is solely dependent upon our desire to become successful. I liken our industry to most others in that we can go to a real estate office, we can dress and talk like a real estate agent, we can drink real estate coffee, we can speak the real estate language, but that doesn’t make us good real estate agent; anymore than sitting in a hen house makes you a hen. Like other professions, all real estate agents are different. You don’t know what you’re getting until you unwrap the outer covering to see what’s inside. Sort of like Forest Gump and his box of chocolates. [Read more…]

The Hardest Nut to Crack

Are You Committed like He Is?

If you are a real estate sales person, the hardest nut to crack in your career is that of self-discipline. Since you are an independent contractor and own your own business, your days are filled with making decisions that affect the success of your entire business. Your ultimate goal is to perform tasks that produce income and to not let non-productive things hinder you from doing the productive things.

A typical day in real estate, in offices across the nation, licensed agents go to their office and drink real estate coffee, make copies on a real estate printer, have real estate conversations, speak the real estate language, and virtually accomplish very few productive things during a day. Unfortunately one can look and act like a real estate agent but that doesn’t make them successful. The vast majority of real estate agencies don’t have in-house trainers to teach agents the proper way to do the business so they can become productive. So many new agents learn from other agents in the office by hanging around the break room and copier. Learning bad habits from other agents is a poor way to learn how to list and sell real estate but this is not our topic for today.

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Prototype for Real Estate Sales

MARKET YOURSELF BY BRANDING

One rarely thinks about all the processes an item goes through before it reaches the retail sales arena. I’m not referring to products that are grown, such as fruit and vegetables, but products that are manufactured for consumer use. There are many, many steps between the times a product is envisioned in someone’s mind, until it actually reaches the retail business where it can be purchased. Almost everything stems from a dream or an idea someone had. Next the idea is transferred onto paper as a drawing by a designer to allow others to perceive what the idea looks like and how it will function. The next step is for some engineer to break the item into components to allow the item to be manufactured either as a whole or in parts so that through close tolerances, all parts can be easily assembled to create an item in its entirety. After carefully checking the engineers work for accuracy, the blueprint is sent to a tool and die department to make a prototype; the first complete transformation of an idea into a visible, functioning item. The prototype is then tested many times, using various techniques to ensure it works the way it was intended. Once the prototype has proven to work as intended, the item is then manufactured and sold to consumers. This is a very broad explanation of the processes almost everything we use on a daily basis, comes into existence. Real estate sales follow a similar path in which I would like to explain in some detail.

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