Overcoming Objections - What to Say and How To Say It

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Overcoming Objections - What to Say and How To Say It

  1. 1. Overcoming Objections 101 What to Say and How to Say It
  2. 2. Thank You!
  3. 3. Objections are Opportunities!
  4. 4. When a buyer or seller gives you an objection, he is presenting you with an opportunity to close.
  5. 5. Make sure that you hear clearly what the person is saying. If you interpret the objection wrong, the answer you give, no matter how eloquent, will not be sufficient to overcome their area of concern.
  6. 6. Confirm what their objection is to ensure you understand it.
  7. 7. Avoid the mistake of trying to answer the objection before the buyer or seller gets the objection completely out of his mouth. The objection is legitimate to that person, no matter how ridiculous it may sound. Interrupting can cause the seller or buyer to become irritated with you. It may not matter how well you handle the objection if you interrupt him.
  8. 8. Your mental approach to an objection will determine your success or failure. Most agents dread hearing an objection, but most objections result from one of two situations….
  9. 9. One: The seller or buyer has legitimate concerns regarding the property and/or your skill set to sell his home.
  10. 10. Two: The occurrence of objections is because your presentation was not good enough. You did not convey the confidence that you are the person for the seller to hire for the sale of his home.
  11. 11. The clients’ desire to work with you is a natural ending to a good presentation. If the presentation is weak, the objections will flow like a river.
  12. 12. Get good with your presentation AND get great at overcoming objections and you will have mastered a great deal of this business!
  13. 13. Too many Agents adopt the position of a deer looking in the headlights when an objection comes their way. These agents have a negative mental attitude towards objections. They view objections as a big wall between them and the sale. Join the ranks of the highly-skilled and highly-paid professional Realtors. Change your mental approach to objections through practice and you will always look forward to the opportunity to receive them.
  14. 14. Let’s Get Started!
  15. 15. If I list and sell with you will you cut your commission?
  16. 16. “I can appreciate the question but as a full time real estate professional, for the sake of my business and my family, I need to be compensated fairly for my time. I know there are some agents that would say yes to your request, but consider this…if an agent is willing to cut his or her commission, how well do you think they will do when it comes to negotiating the best possible price for your home?”
  17. 17. Or “So, this other agent is willing to do the sale for 1% less than I am. That amounts to about $2,500, correct. Let me ask you this, if that agent was so quick to give away $2,500 of his own money so quickly, how quick is he going to give away thousands of your money when it comes to negotiating with another party on the sale of your home?”
  18. 18. Or “I know this isn’t going to happen, but let’s say you’re going to need to have brain surgery done. Now understand money is important. But you look in the paper and you see an ad like this: “This week’s special- brain surgery: 20% off!” Would you call this doctor and has that done? Probably, not, right. Some things are too important to discount. I’m assuming that selling your house and moving to where you want to move its one of the biggest investments and financial things you’re managing in your life, right? Trust me, you don’t want to leave this in the hands of a discounted service agent.”
  19. 19. Why is your price so much lower than that of other agents we have talked to?
  20. 20. “I know that it’s confusing when different agents come in with different pricing options. In fact, it is not difficult to work the MLS data to come up with a large range of numbers. There are many agents out there that don’t have a lot of listings, and they will sometimes tell a seller what they want to hear simply to get the listing. They will worry about price reductions down the road.”
  21. 21. “I take my job very seriously. With a 13 month supply of inventory on the market right now, I make it a point to tell my clients the truth about the value of their property. In a difficult market like we are in, there are many agents happy to get the listing. I on the other hand only want to spend my time and energy on listings that will sell. There are two places you can list your property. You can list it where it sits or list it where it sells. Which would you prefer?”
  22. 22. You have so many listings, how can you give our listing the attention it deserves?
  23. 23. “Three weeks from now I think you’ll be looking back and thinking that one of the biggest advantages I bring to the table is my other inventory. You see, the more signs I have on the street, the more calls I get from buyers and most of those buyers don’t buy the house they call about. In fact, if they are not interested in the home they are calling on, I look first within my inventory to find them a different one. Now can you see the advantage of listing with an agent that has a strong inventory of other homes available? Benjamin Franklin had a quote that said “If you need something done, ask a busy person.””
  24. 24. I want to find a house to buy before I put mine on the market.
  25. 25. “I agree, finding your new home is important and the unfortunate thing is that it could take as long as three months for your home to sell. Then it will take another two months to get all of the paper work done and, by that time, any home that you would have found, would already be sold."
  26. 26. OR “Ok, let’s sign the paperwork tonight on your home, subject to finding suitable housing, and then I will make an appointment with you to meet with a lender to see if you would qualify for two mortgages at the same time.”
  27. 27. OR “Let’s talk for a minute about your home being listed. We have talked some about the challenges of today’s market. How would you feel if an offer came in on your home right now, and that offer was subject to the buyer selling his home that is not yet sold?”
  28. 28. OR “The problem with finding the house you want to buy first is that you could end up losing a lot of money. Either you’re going to have to end up paying top dollar for your new home or you’re going to have to sell this one for less. Let’s say we go out and look at some houses, and you find a house you like. You go to the sellers and you want to negotiate them down . You haven’t sold your house yet, so are the sellers for the new one going to be at some risk, since you haven’t sold yours? So what are the sellers going to do? They may sell it to you under some tough conditions. Do you think they’ll be flexible on their price? Or do you think they’ll stay firm, since they’re taking risk?....”
  29. 29. “Let’s say you even do negotiate with the seller and work out a good deal. You’re now under contract to buy that house. Now, what do you have to do with your house? You have to sell it quickly! A quick sale means a discounted sale in this market. The worst part about all of this is that you’re not in the driver’s seat. You’re not in a good position because you need the money quickly to pay for the other house. But here’s the worst part. Whether it’s contingent or not, if you don’t sell your house in time and you have to drop the whole thing, you lose all around. Let’s look at the flip side. Right now we’re in the driver’s seat, meaning you don’t have any specific commitment to buying a particular house, right? ….”
  30. 30. “That’s beautiful, because here’s what we do. We put your house on the market for the price that we want. We wait until we find a buyer. When one comes, we sell it – no pressure, we’re in the driver’s seat. We find a buyer and this person is willing to give us our price. Now we go and find the sellers of another house and say, “Look, I want to buy your home, and I’ve got $105K cash.” Do you think that the sellers would be willing to listen to you? And they might even do better on the price. Or maybe you can negotiate and say when you’d like to close based on your buyer. My point is that by selling your home first, you’re in the driver’s seat. If you go out and buy a house first, you’re locked in because you’ve made a commitment. You’re no longer in the driver’s seat.”
  31. 31. You don’t seem to sell a lot of homes in our price range.
  32. 32. “That’s true. In fact I sell a lot of homes in lower price ranges and what I find is that after I sell my client’s homes, many of them move up to your price range, therefore, it only makes sense … that the next logical step for me is to start to sell your price range as well, considering I already have a relationship with many of the buyers that will be interested in your home.”
  33. 33. I need to net this amount in order to move, I have to be at my new job in 90 days, but I can’t afford to buy a new home if I take a loss.
  34. 34. “I hear you! There are a lot of people in your position in this market. Has there ever been a time when you knew you were going to have to make a sacrifice? Where, you knew it was going to be tough and in the end, after analyzing all of your options, you realized that there was only one thing to do…just go for it was only one thing to do. But you found that in the end, it all worked out. You made it through the tough times and life went on, maybe even better than before …”
  35. 35. “This time is just like that time. The market analysis shows that it is unlikely anyone is going to give you what you need to make this move … Is it more important to get out from under this house, take the new job and work through the tough times or are you in a position to keep making mortgage payments on this house for a couple of years until property values go back up?”
  36. 36. Or “Lets pretend that I give you 100 one-dollar bills and I say, “Go to the mall and sell each one for 95 cents.” This is hypothetical, obviously. For 95 cents, do you think you’d sell them? How quickly would they sell if we marked them at 85 cents? How about if we marked them at $1.20..how fast would they sell? What I’m saying is by taking a house that’s worth $200k and trying to get more for it than its worth, it may take extremely long time.”
  37. 37. If we have to go that low we will probably just list it ourselves and offer to pay 3% to any agents that want to sell it.
  38. 38. “I can see your point of view but there is a lot of legal paperwork/disclosures that a listing agent would handle once the property is under agreement. Who will handle that paperwork for you? As well, do you think many buyer agents will feel comfortable selling the property knowing that there is not an agent on the listing side to handle the paperwork/disclosures etc? In other words, buyer agents may be subjected to greater risk by selling a house that is not listed by a real estate agent. Can you see how that would affect the salability of your home”
  39. 39. We can always come down in price later.
  40. 40. “You’re right, but I’m afraid by that point you’d have to deeply discount your price. You see, if we come out of the gate with your home overpriced many of the buyer agents will instantly write you off as non-motivated sellers . Let me explain what that means from an agent’s perspective. The higher a price is on a property, the less a seller needs to sell it … at least that’s what the agents believe, from their past experience. To agents, a non-motivated seller means, that even if you come down in price later, two things will happen…."
  41. 41. “Most agents won’t even realize your home has been reduced. Now, you might say, can’t we send them a flyer telling them that it’s been reduced? Yes, we could send everyone a flyer telling them that the prices has been reduced, but agents get 500 flyers a week and there is a good chance it will go unnoticed. If they see that you had the home priced real high in the beginning, that will tell them that you were kind of unrealistic when we listed the property, meaning that you didn’t believe that what I was saying was true … all agents interpret this as trouble when it comes to getting the deal closed. Do you understand why? If we price it to sell right from the beginning, our odds of getting agents to show it is much higher.”
  42. 42. We aren’t quite ready yet, we need to finish a couple of projects around the house before we put it on the market.
  43. 43. “Awesome! Why don’t we complete the paperwork now and while you are doing your projects I’ll get the flyer done and paperwork processed so when you are ready I will be too! We’ll write in to the contract no showings for two weeks!”
  44. 44. Will you cut your commission? There are other agents that will do it for less.
  45. 45. “You know, you’re right, there are a lot of desperate agents out there and I’m a little concerned for you should you choose one of them. If an agent is so desperate that they are willing to broadcast the fact that they don’t think they have any value as a Realtor, is that the type of person you want sitting across from the negotiating table trying to negotiate you a better price? Is that the type of person you want to represent you in the most valuable transaction of your life?”
  46. 46. OR “Commissions aren’t negotiable with agents that sell homes. They are only negotiable with realtors who don’t believe in the services that they offer. You need a strong service agent that sells homes, right?”
  47. 47. OR “Here’s a list of what I do for you as a professional, what would you like me to take out?”
  48. 48. There’s a lot to Do! Prepare pre-listing packet and deliver…………………………………………37 minutes Prepare comparative market analysis…………………………………….……59 minutes Study and analyze market data……………………………………………..….30 minutes Drive by comparable properties……………………………………………… 34 minutes Prepare personalized market program……………………………………….. .66 minutes Travel to appointment …………………………………………………………30 minutes Appointment time…………………………………………………………….. 90 minutes Complete listing data and contracts………………………………………….. 32 minutes Input listing in multiple listing database………………………..…………….. 25 minutes Input and launch marketing plan … …………………………………………..94 minutes Install sign, lockbox, take photos, measure property……………………….... 52 minutes Create marketing ads and home brochure…….……………………………… 90 minutes Design and prepare "Just Listed" postcards…………………………………... 22 minutes Prepare visual tour and post to all major sites ………..…………………….... 61 minutes Prepare and create internet ad………………………………………………… 20 minutes Prepare mailing labels and process "Just Listed" postcards………….………. 85 minutes Contact top agents with new listing information……………………………... 90 minutes
  49. 49. And… Pick up Sellers' disclosure and take out brochures………………………….... 24 minutes Research mortgage information ……………………………………………....17 minutes Prepare and set up co-op instruction and log ……………..…………………...18 minutes Place and proof weekly online ads …..…………………..…………………...135 minutes Prepare biweekly Homes Magazine ad ………………………………………..57 minutes Prepare monthly Homes & Land Magazine………………………………….. 25 minutes Proof ad and process corrections…………………………………………….... 20 minutes Prepare and deliver showing basket…………………………………………... 53 minutes Marketing/staging walking homes tour ….……………………………………25 minutes Reprint and restock flyers……………………………………………….……. 44 minutes Check signs and property weekly ………………………….………………….80 minutes Order and review preliminary title work……………….…………………….. 45 minutes If problems- research and correct…………….………………………………. 25 minutes Research land variances on acreage lot size…………… …………………… 60 minutes Feedback from showing (averages 5 attempts per showing)……………….. 518 minutes Prepare and log feedback responses…………………………………………. 37 minutes Update social networking sites weekly with property info………...…...……. 31 minutes Prepare Sellers' weekly report………………….…………………………….. 88 minutes Call Sellers weekly with update……………………………………………… 60 minutes  
  50. 50. And… Additional consulting calls with Seller…………………….…………………. 30 minutes Reverse prospect for buyers weekly in MLS ………………………………… 61 minutes Set up co-ops for showing home……………….…………………………….. 30 minutes Launch marketing plan for an open house……………………………………. 32 minutes Hold open house ………………………………………….………………….180 minutes Follow up with open house guests (prepare and mail cards)….……………… 75 minutes Set up Realtors' luncheon ………………………….………………………….34 minutes Design Realtors ' luncheon flyer ……..………………………………………...52 minute Host luncheon ………………………………………………………………...180 minutes Prepare comparative market analysis for 30-day research ……………..…….124 minutes If needed, re-appraise property condition ……….…………………………….47 minutes Get bids for repair work as needed ………………….………………………..182 minutes Review bids, present to Seller………………………..……………………….. 60 minutes Meet workers as needed …………………………….………………………..180 minutes Remake and reissue flyers……………………….…………………………… 83 minutes Tour competitive properties and compare pricing …………………………… 50 minutes Review offers :………………………………….……………………………. 60 minutes   
  51. 51. And… Prepare Seller's net sheet. ……………………………………………………..26 minutes Present offers .…………………………………..……………………………..60 minutes Negotiate contract ……………………………………………………………..90 minutes Review and create negotiation strategy………………………………………. 33 minutes Discuss home inspection issues with all parties ……………………………… 42 minutes Follow up on mortgage and inspection contingencies ……...……………….. 31 minutes Finalize offer………………………………………………………………….. 63 minutes Complete contract review and collect signed contracts…...….………………. 60 minutes Verify closing time and date with all parties …………………………………. 20 minutes Verify smoke and carbon certificates are collected ………………………….. 10 minutes   Total minutes worked on an average (non-distressed) listing      = 4,200 minutes How much does your attorney, doctor, mechanic, or plumber charge per hour? My marketing fee stays the same no matter how much time, effort, or marketing dollars I put into reaching our goal of SOLD. Can you see how this fixed rate compensation program works to your benefit?
  52. 52. We want to have an exclusion in the listing contract in case our friend or neighbor wants to buy it.
  53. 53. “I agree that it’s important to be thorough when we are filling out this contract and let me ask you this … Why haven’t you already sold the home to your company, friend or neighbor? (No one has made an offer) Your personal marketing hasn’t worked and that’s why you’re hiring me … is that right? If my marketing works well enough to convince your friend or neighbor to buy it … isn’t that what you are paying me for in the first place? Aren’t you hiring me to let the public know your home is for sale and convince people that they should buy it? Why would I cut my commission if my marketing works?”
  54. 54. The last agent never showed our home himself and neither did anyone else from his office.
  55. 55. “Did they promise you that they would be showing your home non-stop? Well then, I can appreciate what you’re telling me. I for one will not promise that I will be showing your home. I am going to market your property to the top 25 agents in the area that sell 80% of the real estate. Did you want me marketing your property to the real estate agents that don’t sell real estate or should I just spend time marketing to the ones that do?”
  56. 56. We want to try selling it ourselves.
  57. 57. “I totally understand the thought of trying to get a home sold yourself . Part of what I do as a professional is spending time contacting other agents and potential buyers…as many as fifty or more a day. I ask them if they would like to buy your home or if they know someone who would like to buy your home, or if they would like to sell their home. This is what I consider active marketing. How skilled are you at phone solicitation? Have you ever done it before? Open houses, newspaper ads, and flyers are great, but those typically don’t get the home sold.”
  58. 58. Should we wait until the market improves before we sell?
  59. 59. “Since you are looking to move into a larger home, the easy answer to your question is no. Let me show you an easy example. Let’s say your home 5 years ago was worth $300,000 and with values down 15% you are seeing a decrease of about $45,000 in equity. Now, let’s say the house you were looking to buy was worth $400,000 5 years ago. With values down about 15% you’d be saving $60,000 in your search. You don’t want to the market to change yet! You’re saving $15,000!”
  60. 60. “Since you are looking to move into a smaller home (or even a rental), the easy answer to your question is no. First, we don’t know how much longer it will take for the market to change. As well, you have to factor in carrying costs. Right now you are paying $2000 per month. The next home will cost around $1200 a month. That means every month that goes by you are throwing $800 out the window”
  61. 61. We’d like to meet two more agents before we decide on who we will choose.
  62. 62. “That sounds reasonable. How will you be comparing agents? What differences will you be looking for? Will you be comparing them based on events they can control (year of experience, marketing plan, etc) or events they can’t control, like marketing time and market value?”
  63. 63. I don’t want to do those repairs before I sell, let the buyers do it themselves.
  64. 64. “When you were shopping for your home, were you looking to buy a home that needed repairs or did you want something move in ready? Many buyers, if given the choice …which in this market they have lots of choices, will lean toward a move in ready home. Also, did you know that buyers will over-estimate the cost of the repair by 2-3 times, then reflect that amount in their offer to you.”
  65. 65. Or Have you ever heard the expression “it’s all in the presentation?” Mr. Seller, let’s say that you want a steak. At a fine restaurant, they might charge somewhere around $35.00 for a standard cut of a meat. If we go to a local, fast food steakhouse chain we’re going to pay about $9.95. Same steak. What’s the difference? The atmosphere, the décor, the building, the location, the service, the presentation. So, as an analogy, if we want to take our $9.95 steak and get $35 for it, we’re going to have to make some adjustments in the presentation of the home. Either you’ve got to invest several thousand dollars to fix the house up to get that price or just leave it the way it is and go with the price I’m suggesting.
  66. 66. I want open houses every single weekend until it sells.
  67. 67. “Why do you want one every weekend? How would you feel if we did one every day? You see at some point there is a diminishing return on exposure that an open house can bring.”
  68. 68. I’d like to write an offer that is $50,000 below asking. Let’s see how much we can squeeze out of them.
  69. 69. “Making a low offer seems tempting but let me ask this, if you make an offer and lose the home to someone who makes a higher one, what will you do with the money you saved? I just want you to consider this…what’s more important to you owning this home or saving money? From my experience I can tell you that I often times see sellers take less then asking, but that’s when they are coming down to market value. When a home is priced AT market value, those homes typically sell AT market value, and sometimes even more.”
  70. 70. “Another item to think about is your relationship with the owner. If you came in $5 below asking the seller would be foolish to counter. If you come in way too low your suggesting you WANT them to counter. Also by going too low you may offend the owner and lose an opportunity to negotiate the best agreement.”
  71. 71. I think we will wait to buy… we want to jump in when prices are rock bottom.
  72. 72. “Believe me, we all want to jump in when the market bottoms. The question is, how will we know when we’ve hit the bottom? The answer is, when the market goes back up. We will never know when the market IS at the bottom, just when it WAS at the bottom. So… the question is this, is there a benefit to buying a home before the market bottoms rather than after? Yes….”
  73. 73. “1. Lower rates 2. More inventory to choose from. 3. You can take your time. In a sellers market there are typically bidding wars and you have less time to make decisions 4. Buying now means you can enjoy your new home sooner.”
  74. 74. We had a bad experience with our agent so we are going to sell on our own.
  75. 75. “Let’s take a scenario like this. I’m going to purposely blow it out of proportion a little. You were flying to Chicago and you flew a particular airline. You were a few hours late. Your bags were a day late. The flight attendants went to a bad training program, “Arrogant 101,” and you ran out of peanuts. Now, you need to go to California. Would you walk or would you still fly? You’d probably fly. Why? Because you know the plane is better than walking. You get their quicker and you won’t pass out from muscle cramping and dehydration along the way. Just because you had a bad experience, you aren’t going to rule out flying all together. You may never work with that airline again, but you still see the value of flying. What I’m saying is, don’t discount real estate just because you had a bad experience with that one. Just don’t use that one again.”
  76. 76. We want to hire you, but we must list at a higher price.
  77. 77. “So Mr. Seller, let’s pretend you were going fishing and the fish were down here. Where would you want to place the bait? Down here…right? Let’s say that we place the bait up here. Are we going to get nibbles? Doubtful, right? Yeah. We may get one fish to stray from the pack. But the odds of catching the fish are not in our favor. Here’s the reason I’m using this analogy. I’m recommending that we put the house on the market for $150k because based on comparables, that’s where the fish are. If we price it though at what you’re suggesting at $160k I’m not saying that the house won’t sell, but it’s not probable. So the choice is yours.”
  78. 78. Or “If your house is worth $150,000 and we were to list it $130,000 what do you think would happen? Right…we’d probably have buyers knocking down the doors to get in. If we list at $150k we’re going to get an average number of buyers to get the house sold in the time frame that I showed you, because that’s fair market. So if we go above fair market, we’re going to have fewer potential buyers because of competition from other homes- it just weeds out more and more buyers. If we listed it for $200k, we’d have maybe one, if any, right? So the higher you go, the fewer buyers. The fewer buyers, the longer it takes. Well, my concern is that when a house stays on the market for too long, it gets stale. For example, let’s use bread. You know, when bread stays on the shelf at a supermarket for too long, what happens?....”
  79. 79. “It gets stale right? When a house is on the market for a while, in a sense it becomes stale. The agents don’t show it as much, they start to lose interest. It becomes back-burner stuff because it’s stale. When is the best time to sell? As soon as you put it on the market. You want to package the house in its best light- the price its appearance, everything. If we already know, Mr. Seller that in 30 days we’re going to come down to the price that the CMA is now saying we’re better off starting out that way because a house is never hotter than when it first comes on the market.”
  80. 80. Overcoming Objections 101 What to Say and How to Say It
  81. 81. Thank You!
  82. 82. Thank You!

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