By Craig Proctor
RISMEDIA, May 21, 2008-Any prospect who has put their home on the market knows that there is usually no guarantee that their home will sell. Homeowners further know that selling a home can be a real hassle from a number of different angles.
First, the stress of always keeping your home “presentable” can be a challenge (especially for families with kids at home), and this can go on for months with no end in sight.
The Real Estate Catch 22
Secondly, homeowners are aware of the looming and stressful possibility of what I call “The Real Estate Catch 22,” which is that the sale of their current home, and the purchase of their next one, may not coincide during a convenient time period. In other words:
• If they buy before selling, they may have to carry the financial burden of two homes, and
• If they sell before buying, they may be homeless for a period of time
Both of these situations arise because the time frame within which a home sells is dependent on a number of factors and can vary widely.
A really effective way to solve this for your clients is with a Guaranteed Sale (or Trade Up) Program where you offer to buy their home for cash when they trade up to one of your listings.
How the Program Works
First, note that this is a “trade-up” program, which means that to qualify for this offer, a client has to move up to one of your other listings. Here are some basic guidelines or rules you should apply:
A client must agree to buy one of your listings directly through you before you will buy their current home
The price you will buy their home for will be “market value” which is the price you agree together represents a realistic price (in the context of current market conditions, the price other similar homes sell for, etc.) minus a guarantee program fee (see next point).
You will pay them this market value less a 5% guaranteed sale fee. The commission then comes off this net price.
You will only guarantee homes valued at under $500,000.
You should negotiate an open line of credit with your lending institution to cover the unlikely possibility that you might have to buy a client’s home.
The seller gets any offers higher than the guarantee, (not you). But if no offer beats the guarantee within 120 days (or whatever time period you decide to specify), you are obligated to buy their home at the upfront guaranteed price.
The Guaranteed Sale Program is an extremely powerful offer that I am known for throughout my marketplace. I have written up hundreds of contracts but have seldom had to buy a house because my systems are so good that it’s rare that I am unable to sell a client’s home when they’ve met my conditions and signed up for this program.
Remember: You have total control over who you will accept into the program. You’re narrowing the window anyway by specifying that they have to move up to one of your listings. However, it’s important to apply your guaranteed sale program guidelines carefully to ensure you’re not in a situation of any undue risk.
Even if a seller doesn’t qualify directly (i.e. they’ re not moving up to one of your listings), remember that this program will still benefit them indirectly as you’ll guarantee to buy someone else’s home to get their home sold. You should explain to sellers that this program makes their home more desirable to buyers as it allows them to place a firm offer on their home rather than a conditional one.
Benefits to Buyers:
• Eliminates the dilemma of whether to buy first or sell first by removing the potential stress of owning two homes or none at all
• Allows buyers to make a firm offer when they find a home they like
Benefits to Sellers:
• Makes seller’s home more attractive to buyers
• Sellers are more likely to get a firm offer from buyers (vs a conditional one) because you will be willing to guarantee the sale of the buyer’s home (in other words, you take all the risk)
Benefits to Agent:
• This is an offer that few other agents in your marketplace will be willing to match because they think it’s super-risky (which it actually isn’t). This sets you apart from other agents and gives you powerful leverage with prospects.
• You’ll double-end a ton of your listings and pick up backup listings.
“The Guaranteed Sale Program is one of the strongest Unique Selling Propositions (USPs) that can be offered to the public because it very powerfully answers the consumer question: “What’s in it for me?” The simple reason agents don’t use this powerful program is fear. That fear comes from a lack of understanding of how straightforward the parameters of the program actually are. Naturally, what you don’t know will scare you, but the good news is that it doesn’t take a rocket scientist to break this program down and have it make complete sense! I made sure I did this in my business and, as a result, this powerful marketing program allowed me to leap-frog my competitors.” – Danny Griffin, Hyannis, Massachusetts
To find out more about my Guaranteed Sale Program, you can visit http://www.hypertracker.com/go/cp/a01a080521/ where you can learn about my 3-day SuperConference where I teach agents how to create and effectively run performance guarantees.
Billion Dollar AgentTM Craig Proctor has been in the top 10 for RE/MAX Worldwide for 15 years and is a real estate trainer who does what he teaches. Craig consistently sells over 500 homes per year to earn almost $4 million in commission. Over 25,000 agents nationwide use Craig’s system to make more money in less time. To receive free training from Craig with no obligation, visit: http://www.hypertracker.com/go/cp/a01b080521/. This Free Training includes free weekly teleconference training calls with Craig and some of his most successful agents where they discuss the cutting edge strategies they’re using right now, in this market, and explain how they work. You’ll also receive a free weekly email newsletter that reveals the tested and proven marketing strategies that continue to make Craig one of North America’s top agents. By taking advantage of this free training, you’ll also get advanced notice of Craig’s free half day seminars that will provide you with the tools you’ll need to start implementing these ideas immediately. These seminars are held year round in cities across the country. To receive free training from Craig with no obligation, visit: http://www.hypertracker.com/go/cp/a01b080521