Real Estate Newbies: Why You Should Shut Up & Listen
Talking to sellers can be a little intimidating the first of couple of times you receive a phone call.
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I often hear stories of newbies (when starting a mailing campaign) describe the fear they had when speaking to a seller for the first time. I experience the same fear. You begin to have a 1000 questions running through your mind such as:
- What questions to ask?
- How to initiate the conversation?
- What will the seller say?
These are just a few questions the anxiety of speaking to a seller will create. Preparation will eliminate or at-least minimize that anxiety and move you into a level of confidence. I recently came across a very inspiring quote by Abraham Lincoln and his theory on preparation.
“Give me six hours to chop down a tree and I will spend the first four sharpening the axe.” ? Abraham Lincoln
Preparation is the essential in being successful in every aspect of your life. I look at things through the lens that everything is created twice, first as a thought and secondly as a creation. Everything that was created was a thought first. Without getting all scientific and metaphysical, here me out. Before the iPad was create physically Steve Jobs had to create it in his mind and then create it on paper which materialized into a tangible product. This is how your conversation with sellers must be. Before picking up that phone, see the conversation all the way through and you will have your blueprint for a successful conversation.
How to Talk with Motivated Sellers
Here are some of the elements that I use that will help you visualize your way through a successful Seller conversations:
#1 Introduction: A well-grafted introduction sets the tone of the conversation. This introduction should be the first few lines of your elevator pitch. The elevator pitch is a 30-second speech that summarizes who you are, what you do and why you’d be a perfect candidate to help them with there housing situation. After the introduction it becomes evident if the caller is a tire kicker or if they are genuinely looking to sell their home.
#2 Speak with CONFIDENCE: A seller will notice if you are well informed and that you are familiar with real estate and how to navigate a transaction. They will ask you questions as well, but don’t let this make you nervous or intimidate you. Sellers are seeking information just as you are so be confident in answering questions. Yes, you will stumble a bit but make sure you have a script ready of the questions you need to ask. You will not know it all but as long as you know the very basics of how a transaction works you will be able to get through the conversation.
You have to remember you are not selling anything you are having a friendly conversation about how you can help them.
#3 Ask Leading Questions: A Leading Question is defined as: a question phrased in a manner that tends to suggest the desired answer. This type of questioning is great because it directs the seller to identify their motivation. Its similar to being the captain of the ship. You are helping the seller navigate their way through choppy waters. By asking leading questions you will find out so much more information than if you were to be straight forward. Take your time, what are you rushing for your just have a general conversation with a friend, this is the feeling you want the seller to have. Its all psychological, and leading questions will help you understand how they view the property.
For example: So how much work have you done to the home recently? By asking this leading questions the respondent will inform you of the condition of the home and if they still have pride in ownership. A great follow up question if the home has not been updated is What happened? or Why haven’t you put any work into the house? This is valuable information you will receive and you will be able to gauge the owners level of motivation.
#4 Actively Listen: One of the biggest mistakes an investors make in a conversation with a seller is focusing on getting all the questions answered that’s on their note pad. The best thing to do is ask a question and then Shut Up!
In any conversation if you let someone speak long enough they will tell you all the information you need to know. People often like to impress others with how much they know, please don’t be that person. You want to receive information and not give too much information. Try and be the receiver as much as possible and not the sender.
#5 Closing the Conversation: When closing the conversation its great to ask the seller, “Again how can I help you, or better yet, What do you want me to do?”
Often you will hear, “Give me a price my house is worth.” That is great because now you can give them actionable steps they need to take to start the process, such as asking them what do they think its worth or how much they think the repairs are. They will more than likely have no clue and this is your opportunity to give them a price on what you will pay for the property, and state this price is based on a desktop valuation without viewing the property. This also will identify the sellers motivation, if they are willing to proceed. During this initial conversation there is 1 thing you are really looking to find out, “Is the seller motivated”, this is the whole goal of the conversation. If the Seller is not motivated now then you need to be actively seeking what will spark motivation.
Seller conversations can be steered as long as you are prepared. By using this outline will help you gauge seller motivation and save you valuable time on the phone. The more leads you can touch the more opportunities you have to close deals. If you know of ways to steer seller conversations we would like to hear from you. Its good to hear how other investors navigate their way through these conversations.