How Real Estate Agents Can Manage Difficult Home Buyers
November 30, 2017 |
Whether you’re a seasoned agent or just starting out at a real estate school, one thing that all agents need to learn is how to handle difficult home buyers.
How to Recognize Difficult Home Buyers
There are several warning signs to look for when you are working with buyers.
Every buyer should know what they want in a house. How many bedrooms and bathrooms, what style, what school district and so forth. The ones you need to look out for have a very specific list of requirements. They want marble backsplashes, a fenced yard, tile/wood/Berber carpeting, on a cul-de-sac in a gated community….all for a bargain price, of course.
These buyers are difficult because you are NEVER going to find them the “perfect” house. If you do manage to find one that meets their wish list, they could end up buying something totally different.
For example. An agent once told the story of a family with five kids, one of which was in a wheelchair, so they needed almost everything to be on one level. They really wanted each child to have their own room and they wanted a great school system. After showing them countless ranch-style properties, the agent found them a beautiful ranch with a wheelchair ramp and a walk-out basement in a wonderful school district. It had four bedrooms and all the living areas on the first floor plus two finished bedrooms in the basement! SOLD right?
Wrong….they bought a Cape Cod two weeks later from another agent.
The other side of the scale is too flexible. These are the people that have no idea what they want. The “they’ll know it when they see it” crowd. They don’t have a clue what style, what neighborhood, or even what their price range is.
The problem here is that you will have trouble narrowing down what they really like. You’ll spend countless hours showing them a wide variety of properties just for them to say “no, that’s not it”.
Too Many Cooks
There’s an old saying, “Too many cooks spoil the broth” and that can translate to buyers as well. These are the people that bring an entourage to every showing. Mothers, mother-in-laws, second cousins… you get the idea.
This becomes an issue when everyone has a different opinion and the buyers start listening to all of them. You can be certain that at least one person in the group isn’t going to like something and will talk your buyers out of making an offer.
How to Handle Difficult Home Buyers Before and During the Sale
Now that you know how to spot a difficult buyer, the question becomes, what is the best way to handle them. Assuming you have an exclusive agreement with them already in place, you need to be sure whatever you do doesn’t violate any of that contract. Beyond that, it’s time to put your foot down…gently.
Before the Sale
If you have already shown them a significant number of properties with no nibbles toward an offer, it’s time to sit down with them and get some more information.
If they have too many requirements, explain the need to prioritize what they absolutely need over items that they just want in a home. Explain that some things, like fencing and specific wall colors, can be changed later.
For the undecided buyer, go over every house you’ve shown them and ask them to tell you what they liked and didn’t like. Get them talking to you and each other. By this point, they should be able to give you a better idea of what they want. While you can’t steer them in any particular direction, you can use your powers of persuasion to get them to come to a general consensus.
The ones with the entourage are a little trickier. Try to limit the number of people that you allow to attend a showing. This isn’t always possible if they are adamant. Also, encourage your buyers to make their own decisions. It’s their house, they are the ones that will be paying for it and living in it.
During the Sale
The biggest issue with difficult buyers during the sale is what’s known as “buyer’s remorse”. This is where, once the offer is placed or accepted, they panic and want to change their mind. The danger here is that they will use any excuse to back out of the deal.
To combat buyer’s remorse, you need a two-pronged approach. One is to prepare them for each step in the process and reassure them that they made a good decision, even if they are scared. The second is more clinical. Be sure to write up your offers and contracts with specific language as to the amount of the non-refundable escrow deposit. Sometimes, the thought of losing that money is enough to keep them from backing out. The other area to be concerned with is anything that gives them an easy out, like the home inspection. Be sure that it is clear, in the contract, what kinds of repairs are grounds for contract termination and which ones aren’t.
How to Avoid Difficult Home Buyers in the Future
Any agent that’s been in the business for any length of time will tell you that completely avoiding difficult buyers is not possible, they are a fact of life. However, you can mitigate the level of difficulty with some careful preparation and planning.
Before entering into an exclusive buyer’s agreement, sit down and talk, really talk and listen to them. Go over the ground rules of what is expected of you and them. Get them to talk about what they are looking for and what their needs vs. wants are in a new home. Explain to them every step of the searching and buying process so they will know what to expect. Also, make sure they are pre-approved with a reputable lender so they know their budget and you do too.
With these tips, coupled with a solid licensing and continuing education plan from Hondros, you’ll have all the ammunition you need to have difficult home buyers eating out of your hand.