How to Talk to Prospects

Being friendly and likeable is crucial in creating a good relationship with prospective buyers. Try to find points of interest that would appeal to the buyer by asking questions.

Ask where they work, how many children they have, do they currently live in the area? These causal comments can give you an idea of what to feature. Will they be close to work, schools, parks or transit? Is there plenty of room for the size of the family? Can you tell them something about the wonderful neighbors?

You know your home better than any realtor ever could. Try to find the most positive aspects that each prospect may find appealing. If they don’t agree, at least the sale won’t be lost for lack of trying.

If you find a prospect who seems ready to make an offer, or shows sincere interest, don’t be shy.

Ask for an offer. You may feel that an offer will be made when the buyer is ready, but making a large purchase, such as a home, requires a certain amount of courage. Your buyers may be very tempted but need you to ask the question outright to move them to a decision.

You don’t want a nervous buyer who may have never bought a home before to walk out the door and buy the home down the block just because an experienced realtor asked the question. They will.

Don’t be nervous. If they want to make the offer they will likely feel relieved that you asked.

Approach them after they’ve had time to roam the home and discuss it among themselves. Ask them in a friendly tone "Would you like to make an offer? Perhaps we could sit down and discuss it right now".

Don’t be surprised to be given very low offers to start. The buyers want a deal just as much as you want a profit.

Take every offer into consideration. Drop your price in increments depending on how low the original offer was. If the original price was $150,000 and the offer is $135,000 you might want to offer $149,000. If the offer is getting close, try to split the difference. If you get an offer at $146,000 why not suggest a split at $148,000?

When you’ve met your threshold or you are firm on the original price you should still have some bargaining chips on your side. Perhaps they would like to have the fridge and stove or the lawn mower included. If you are moving into a condo with appliances, you might find this a better deal than selling them privately.

The trick is to NOT list these items on your feature sheet or mention them as part of the package. You may have several items you’d be happy to leave behind including drapes, a freezer or other items. You might also be surprised what the buyer suggests. If you can part with it and it seals the deal than go for it!

Getting the Offer on Paper

There’s no such thing as a handshake deal in real estate. Make sure you have something in writing before they leave the house.

You have all the necessary documents ready thanks to your preparation with the lawyer. You’ve discussed the price and negotiated what stays. Now you can ask what down payment they have ready or when they think it will be ready.

Walk them through the contract, explaining to them as your lawyer did for you. Fill in any subjects (you will review this information under the chapter on legal information) and discuss the deposit.

Never take cash for a deposit. Have the buyer make the check out to your lawyer which will be deposited into an escrow account. This will assure them that you will not have access to their money until the contract is settled. If the contract falls through, the lawyer will refund the money or give back the original check.

The deposit is to ensure the purchaser’s intention to go through with the contract. Taking a deposit is not required legally, but if it’s in the contract the buyer must provide it. You will have a lawyer to assist you if anyone backs out, but obviously that is not your first choice.

How Much Should the Deposit Be?

By asking for a substantial deposit – anywhere from 3-5% – you will not be running the risk of the buyer giving into ‘cold feet’ or opting to forgo the deposit and start proceedings on another home. Unfortunately some people don’t find a problem with staking claims on more than one property while searching for the best one. The deposit isn’t a legal requirement so any amount will do.

If the purchaser cannot give you the full deposit at the time of signing, you can agree to accept several hundred dollars and include a clause which states that the deposit will be increased to a specified amount within 24 hours (or whatever you have decided). This will allow for the purchaser to make financing arrangements before placing the full deposit. If you feel the reason is sound, take the offer. You may not get a better one.

Obviously the buyer does not want their money tied up in case the financing doesn’t come through. If it doesn’t work out they will need the money to place an offer on another property but you shouldn’t give them too much time or they may back out for any reason.