At the end of every month, properties come off the market in the form of Expired and Cancelled Listings. These listings are properties that did not sell for one reason or another, and in many cases, the homeowner still wants to sell. Typically, the average homeowner who still needs to sell their home will (in my experience) re-list within 3 days. So the problem for the average wholesaler, or Realtor®/Investor is how to help this demographic!
After 18 years in the Residential Real estate business, I can honestly say that my job was to show the average homeowner all the reasons why they should list with me, or if nothing else, NOT list with my competitor! As an Investor, especially a Realtor®, it is hard for me to turn down the very real opportunities that exist with Expired Listings.
However, the biggest problem for an Investor or a Realtor®/Investor looking to help this demographic is that you have never been taught any good dialogues to deal with the Homeowner who is convinced that listing with an agent is the right thing to do. As much as it hurts my Broker heart to say it, there are some times when a Listing is NOT what they need, but a contract. It is for those times that you need to have the words and the skills at your disposal.
The reason why an Expired Listing re-lists is not because they want the most. It’s because you’ve not given them a compelling reason NOT to.
There are at least 10 other reasons that could apply, but here are three reasons to share with any Expired or Cancelled listing who is considering re-listing, and instead, accept your offer!
1. The definition of insanity! Generally, the homeowner is under the impression that the ONLY thing to do is to either go For Sale By Owner, or to Re-List. Forgetting that just down the way, is a bandit sign, or a letter with your name on it! The only thing you need to do here is ask the simple question “What SPECIFICALLY do you anticipate your Realtor® to do this time that they didn’t do last time?”
Many times, they may be told by their agent that they will receive advertisement in a different publication, or a new ad series is coming out, or something to that effect. “Mr. Seller, do you want another ad, or do you want a Contract?”
Sometimes, the average homeowner may even feel like the following: “I’d still make more even if I sold at a low price with a Realtor® than by accepting your offer!” The answer to which is very simple. “Mr. Seller, if you knew beyond a shadow of a doubt that by listing your home, you would actually be killing any chance of it selling, would you consider another plan?”
2. The last agents did all they could. In this premise, you are now moving the conversation to the understanding that it not only is insanity to go and do a repeat of the same thing they just did, but now, removing the agent from the equation. You see, contrary to what most people read in sensationalized rags that some seminar junkie guru puts out, many times, the homeowner is NOT actually angry with their agent. In fact, a surprising number of them are very concerned about their Realtor® in this process. Although when it comes to dollar bills, their care may be suspect, at THIS stage of the game (prospecting to set an appointment) you must be aware that their loyalty is still there many times. So you must negate the “agent effect”. You do this by establishing that their agent did all they could. Looked under every rock, every bush, answered every call, and did everything possible to find a buyer for their home. I mean, it makes sense doesn’t it? If they are trying to get a commission, then you would think that they have done everything they could and turned up NO buyers. Since all agents are on MLS, then any subsequent agent has access to the same people. Therefore the ONLY thing that an agent can do to sell the home differently is to reduce the price.
Now it is a question of how much. How many offers they had over the time of the listing, how much traffic they had, all factor into the comparables of this particular home. No matter what however, do not buy into their story about why the home didn’t sell. Many times, they will state that the reason why is because of the time of market, the agent, a black and white brochure, anything but the price. However you and I both know that price is the only factor when it comes to selling this unfortunate persons property. To get the homeowner to where they want to be in the time they want to be there, you will need to be very honest, and forthright about the price. This will require what my mentor Mike Ferry used to say. This is the “Blinding Flash of the Obvious”.
3. This is “Plan B.” When talking to expired and cancelled listings, the absolute LAST thing many times they want is to get into a long drawn out contract. That is why so many listing agents have problems with expired listings. It is because they want to have the Seller sign a contract right away. It’s a lot like a bad divorce. If you have ever had a divorce, remember how terrible it felt? All the dreams you had that were smashed, and now, imagine ANOTHER wife, or husband sliding in on one knee with a ring in hand before the ink is dry on your divorce. You probably were not in the mood for another commitment, and neither are they. So the key is to present yourself as “Plan B.” Plan B is maybe not as flashy or as sexy as plan A, but it will close. Sometimes, that is all you need. That certainty can carry you a long way when working with the Expired listing that must sell now.
As a word of advice? If you are a Realtor®/Investor then you really ought to look at the service provided by Landvoice. I personally have used them for locating For Sale By Owners, Expireds, as well as Notice of Defaults. I use it because they are the only ones that I am aware of that are compatible with my Apple Lifestyle! Their prices are reasonable, and if you register as a TenMinuteSkill client, then you will receive 50% off your first month’s service. Simply Register here!