My old house needs some work.
For items like windows, doors and furnaces, we can’t just go on the Internet and look up prices, or even get a ballpark estimate, because they involve installation.
We have to talk to salespeople, because the companies that sell these products have decided to use that process and business model.
Some of these salespeople insist on a giving a lengthy presentation. They will not allow an interruption.
There is no such thing as an email, or an over-the-phone estimate. Each company wants face time, and they want to come into our home.
One salesperson quoted us some obscene prices for a furnace, then chastised us for asking about the price before finding out what the service entails. The prices he started with included 10 years’ worth of furnace tune-ups and were twice as high as what we ended up spending on a high-efficiency furnace.
None of the contractors would give us any kind of a ballpark over the phone, just in-home estimates. They would tell us that they needed to explain it all or we would not understand the estimate.
Comparative shopping is very hard to do when the only way we can get prices is to have people come over and give us a presentation. Each contractor insisted that no one else does what he does, and he does it better.
Price is not the only consideration for home improvements. I had to educate myself on furnaces and do a lot of reading before we invited anyone over. It seems like we bought the right furnace and that it’s installed correctly, but we don’t really know for sure.
It all pretty much works the same way in real estate. Homeowners call us, and we meet with them and attempt to sell our services through an in-person appointment.
Some homeowners educate themselves ahead of time. Others look to us for direction.
Even though I was taught not to, when someone asks me how much I charge, I give them a number, just so they stop wondering. Most of the time I still get the opportunity to explain my services. If the price I charge ends the conversation, I just say, “Next.”
(Regular readers may recall that I believe agents need to not only learn how to handle rejection, but to move on and to say “Next” with gusto and enthusiasm, like we mean it.)
When I first started as an agent I was taught to say that I am worth X amount, and explain why. If a prospect tried to negotiate a lower rate, I was supposed to hold my ground and tell them that I would negotiate just as hard for them on the sale of their home. They wouldn’t want to hire an agent who would back down, would they?
To be honest, I am not worth X amount. I am worth only as much as I can convince someone to pay me. I don’t let it affect my self-worth.
There are times when I am happy to take a listing for a lower rate, and other times I ask for a ridiculous amount.
My use of technology keeps my overhead costs low, and I have the option of passing that savings onto my clients if I choose to. I have a lot of flexibility, but some people are not at all comfortable negotiating.
I used to have marketing collateral that I would bring on every listing appointment. Instead of listening, I was presenting. That meant I was addressing objections that my prospects may not have even had. I don’t enjoy such presentations myself, so I stopped giving them to others.
These days all I bring with me is my iPad and my business cards. Instead of a sales pitch, I ask questions, and I let the prospective seller ask questions. All I leave behind is a business card.
My approach is consultative because that is what I want to do. I make sure that I have all of the available information about the house and a list of at least three comparable homes in the neighborhood that have recently sold.
My goal is to have a conversation so we can get to know each other. I’ll answer any questions — including how much I plan to charge.
My rates are always negotiable. I don’t want the people I meet with to get as stressed out about selling their houses as I got about buying a furnace. I want to make it easier, and I want to make it better.
Teresa Boardman is a broker in St. Paul, Minn., and founder of the St. Paul Real Estate blog.