In selling close-outs and other hard-to-sell homes, are you offering Realtors:
O Super-sized commissions?
O Trips, goodies, or even cars?
O Multi-thousand dollar bonuses?
STOP RIGHT NOW!
Why? Because, you’re not incentivizing the decision-makers, only the influencers. In addition, your best local Realtors have an ethical dilemma—how to handle being “bribed”. Finally, there are more effective ways to drive traffic and sell your hard-to-move homes than offering Realtor bonuses.
Remember Who the Decision-Maker Is
If you think Realtors pick out the homes purchasers should tour and buy, think again. The everyday practice of searching for a home is no longer in the hands of the Realtor. With such sites as Zillow, Trulia, Homes.com, NewHomeSource.com plus emailed personal criteria-matched listings from local MLS sites, today’s buyer is in total control of which homes they want to be shown. Incenting agents adds brand exposure but has little effect on which homes a Realtor shows.
Do Buyers Look On Realtor Incentive Favorably?
Realtors are required to take an ethics course every two years and they work under state license law that can revoke their license and end their livelihood with one egregious infraction. Adding a significant increase in commission or offering a bonus to attract a contract puts Realtors in a tough position since license law calls for full disclosure of all extenuating circumstances of a transaction.
You’ve now set up a difficult situation between Realtor and buyer. An ethical Realtor has to inform the buyer of the bonus. These conversations go like this: “The builder is giving me an $X bonus as part of this transaction and my ethics call for me to inform you of this. That’s above my Y% commission. I know I helped you find this home, but as you’ve seen, as I’ve negotiated with the builder to the best of my ability, and I have had and will have your interest at heart at all times.”
If the conversation goes south, Realtors typically face these additional questions:
1) Are you going to split or give me the bonus?”
2) Or, “How can you represent me and my best interests now that you’re receiving this bonus?”
3) Or, “Did you steer me to this home to gain the bonus?” Ouch.
Other Strategies for Turning Those Hard-to-Sell Homes into Cash
Rather than trying to sweeten Realtors’ pockets to sell those homes, consider giving Buyers –
A Desirable Treat—Offer prospects the most valued upgrade buyers wish for in your local area!
Why not start every conversation with potential buyers—via phone, email, chat or text– offering a desirable feature upgrade bonus to promote these hard-to-sell homes? What are the most desirable features buyers are looking for in your area? If you aren’t certain, consider the most used features US buyers search for on Zillow. Here are some of the most desirable to offer if they write a contract in a 48-hour window:
Barn Door: The most powerful search term! Offer to add a barn door to a room off the entranceway, instead of the door to the laundry room or between the master bedroom and bath
Farmhouse Sink: Although it may be more work to add than worth, this is the number two most searched for feature!
Subway Tile: Offer to add subway tile over the laundry sink or another key water-splash area, such as behind a children’s bathroom sink
Exposed Brick: Offer to add this desirable textured wall option to one wall of a dining room, master bedroom or breakfast area
Pendant Lights: Offer to change the kitchen recessed lights to two or three oversized pendants over the breakfast bar or breakfast area for a wow factor
A Desirable Experience –Offer a Buyer-Centric Shopping Experience!
Today’s buyers are driving past your properties sun up to sundown, IPad or phone in hand. Allowing them the opportunity to tour your locked specs –and not just peer in the windows–is a game-changer for these buyers. Instant access technology saves them from the inconvenience of having to call, set an appointment and return.
One company offering such a shopping-friendly experience to builders, NterNow, says that for every buyer’s agent touring a community, there are more than three buyers driving thru unaccompanied by agents. Offering instant home access can help you gather these leads into your funnel and find the buyer for that hard-to-sell home faster.
Providing a more customer-friendly experience pays off. “They love looking at houses independently,” said Sarah Minter of Sabal Homes in Charleston SC. “We had one couple last week who toured and returned the next day with their pre-qualification in hand and wrote a contract for the home.”
So do away with all those Realtor incentives and concentrate on giving what buyers what they most desire – a special feature they can tout to friends, and a better home shopping experience that gives you more prospect leads for those hard-to-sell homes.