Shift Tactic #9: Create Urgency–Overcoming Buyer Reluctance is where you get to bust a myth! Many buyers may think they can time the market, or the right market timing will find them. This mindset may lead to reluctance on the buyer’s part. But this is often a false mindset. Smart buyers operate in the safe zone where prices do indeed fluctuate due to a variety of factors.
Figure 1: “Points of Realization” (Courtesy of Beat the Shift by Gary Keller.)
Understanding Urgency in Shift Tactic #9
Now I know you want to get right to that myth-busting, but first we have to determine a few things. When you are qualifying a buyer during a shift in the market, look at these three fundamental topics:
- Ability: the buyer’s financial capacity for the transaction–do they meet requirements?
- Readiness: is the buyer demonstrating strong personal motivation?
- Willingness: what is the buyer’s sense of urgency?
First in the List for Shift Tactic #9
What did you notice about the list above? You should see that Ability is first in the list. This will always be the case. You quality the buyer’s ability to buy by looking at their answers to these two questions:
- Does the buyer qualify for an appropriate loan or are they a cash buyer?
- Do they have money or can they get money for a down-payment and closing costs?
Second in the List for Shift Tactic #9
Second in the list is Readiness. A buyer’s readiness actually determines their “why.” As a result, once you understand the buyer’s personal reasons, you will then understand what they want and need in their new home.
KEY POINTS TO REMEMBER
Wants are powerful
Needs are more powerful
“If you don’t have a firm grasp of your personal reasons for moving, you’ve missed out on one of the most powerful sources for reducing reluctance and reinforcing urgency” –Gary Keller
Third in the List for Shift Tactic #9
Now we are on the third in the list: Willingness. Think of a buyer’s willingness as being all about action. A shift in the market may impact a buyer’s willingness to buy by introducing fear. The buyers may fear making a mistake, so they do not take action. However, there are tactics you can use to prevent that mindset of fear from taking hold of the buyer:
- Get ahead of the game–head off the issues where the buyer has concerns
- Communicate, communicate, communicate–this will ease the buyer’s mind and keep you in tune with their thought processes
- Support the buyer by providing clarity around the transaction, thus building confidence and limiting fear and confusion
On to Myth Busting in Shift Tactic #9
Here we are, ready to do some myth busting in Shift Tactic #9! How, you ask? Here are three ways you can energize buyer urgency:
- Become your buyer’s local economist of choice, the one they prefer to get information from
- Zero in on the buyer’s “why” to remind them of their wants and needs
- Target the buyer’s reluctance head-on and address the elephant in the room
Becoming the Local Economist of Choice
When the market is shifting, buyers need professional advice more than at any other time. You can fill this need and provide them with valuable information and a perspective that is balanced and void of hyperbole. Leverage media sources such as social media, websites, professional associations, blogs, and newsletters. As long as you understand what you are sharing and can speak to it, you are taking on the persona of local economist of choice. Bust the myths that arise from incomplete market information!
Tapping into the Buyer’s Why
By drilling down deeper into the buyer’s why, you can help bust the myth that waiting is their best option. Ask them questions about why they are looking at buying. As a result, you will not only have more information to help them–but you will also succeed in getting them to cement these thoughts into their current thinking processes. Ask them what buying a new home will do for them, and what it will mean for their family. All of these whys will bust the myth of reluctance. Remember, Shift Tactic #9 is about creating urgency–so you need to really understand the buyer’s motivations.
Overcoming Buyer Reluctance
In Shift Tactic #9, we focus on urgency. However, urgency is sapped of its strength by buyer reluctance. Here, we provide four strategies for overcoming buyer reluctance. All four of these strategies bust through the myths that buyers develop as they try to time the market.
Four Strategies to Overcome Buyer Reluctance in Shift Tactic #9
1. Why wait? There are hazards in trying to time the market
Waiting is a gamble and buyers should understand how interest rates impact the monthly cost of homeownership.
|Home Price (-5%)
|Home Price (-10%)
|Interest Rate (+0.5%)
|Interest Rate (+1.0%)
Table 1: “Home Prices and Interest Rates” (Courtesy of Beat the Shift by Gary Keller.)
2. Looking for a trade up opportunity is easier in a down market
Focus on how the seller will save on the larger home purchase which offsets any loss in selling their current home. Remember, Shift Tactic #9 is all about creating urgency; losing out on savings might be a strong motivator!
3. Less is more–you can help your buyer by narrowing the field
Sometimes there are too many choices and buyers can feel exhausted and unproductive.
- Help your buyer narrow the field, and start with the buyer consultation time
- This will narrow down the selection, speed up the home search, and increase the efficiency of the experience
4. There are opportunities to find a best buy–get while the getting is good
Compile a list of the “Best Buys” in the market.
- Not only can you use this list to help your buyers narrow down their options, it can attract more buyer to you as the real estate expert
- “For access to my Best Buy List, Register Here (or Call Now)”
Your Goal in Shift Tactic #9: Become Adaptable
Ultimately, you want to become adaptable. Your ability to become adaptable will help you maneuver in a shifting market. It will also help you better serve your clients. You can do this in several ways.
- Learning = lean into training opportunities, take advantage of mentoring and coaching programs, continuous education (and not just for compliance). The more you know, the quicker you can maneuver find solutions and recover.
- People = who are you in business with? Are they true partners? The people on your team and/or the vendor relationships you cultivate can help you be more adaptable (offering expertise that perhaps you don’t have).
- Be proactive = make a plan for potential issues. Don’t wait for what you already see coming.
- Know your Business = what is your budget, what are you spending.
Real Estate Market Shift Tactic #9: Create Urgency with Joe Quattrucci
By creating urgency for you buyer, you are better suited to overcome buyer reluctance. Using the strategies and tactics Joe shares in Shift Tactic #9 will help you position yourself as an economist of choice and a local expert in the housing market. Your buyers need that level of support and will appreciate your knowledge and guidance.
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