The number of homeowners seeking cash offers has increased significantly since the dawn of the global pandemic. However, a home seller looking for a cash offer is not a closed-door for a real estate agent. Instead, it is a golden opportunity that we capitalize on.
At Agent’s Corner, we weren’t satisfied that out of over 100 million real estate leads produced every year, only 11% resulted in executed transactions. We set out to identify which homeowners out of this large pool of “interested sellers” had the highest intent to sell. Next, we narrowed our intake of leads to only homeowners ready for an offer. Over a six-month period, we saw a decrease in overall seller forms filled out; yet at the same time, we experienced a significant increase in closed transactions.
By understanding the person’s goals for seeking a cash offer, you can provide them with the best solution possible- which, more often than not, is listing their home.
People Seeking Cash Offers
Here’s the reality: only 10% of homeowners presented with a cash offer accept it. This is because they realize how big the gap is between the amount they would receive in a cash offer versus listing their home.
While financial stress is a significant reason that a homeowner would seek a cash offer, this is often paired with the assumption that taking a cash offer is the best solution to ensure speed and ease in this process.
- SPEED- According to our surveys, the greatest motivation for seeking a cash offer is the speed of the offer.
- SIMPLICITY- Repairs and Contingencies can be obstacles to selling in a traditional setting. If their property requires repairs, they may seek a cash offer hoping that after disclosing the problems or defects, they could be asked to fix it in a traditional sale. Similarly, the buyer may even agree to skip contingencies like home inspection, appraisal, mortgage financing, etc., due to the reduced sale price.
- MISCONCEPTIONS- Often homeowners believe they do not have good alternatives from seeking a cash offer versus traditionally selling their home. As far as they can see, they either settle for less money, but the transaction happens faster and more easily, or they risk months on the market, working through repairs and contingencies. However, with a well-equipped agent, this does not have to be the case.
The real estate industry is transforming, and new options are available to homeowners. Listen to their goals and get to the bottom of why this homeowner is looking for a cash offer. You can then provide them with all of their options and the best solution to reach this goal.
In order to present your potential client with all of their options, we recommend partnering with a local investor or IBuyer program to keep the cash-offer as an option. Here is a partner program that our agents have found success with https://www.opendoor.com/w/agents.
Three Steps to Convincing Cash-Offer Leads to List Their Home
We have put together the 3-step process to closing cash-offer home seller leads. This is based on a pilot test run in several major markets across the US using some of the top realtors and our introductions.
STEP 1: GET THE APPOINTMENT
Once you engage a client who is interested in the cash offer, your goal is to call and discuss their goals.
Talk about the following:
– Why are they deciding to move?
– What is their timing?
– Where do they plan on moving?
– What does their ideal sale look like?
Discuss the future and hear them out to build credibility.
You want to tell them then WHY they will love what you have to offer and what separates you from other real estate professionals in relation to their unique goals.
Example:
“Mr. Jones, we would love to do the easy work and get you a cash offer from our investors, that’s the easy part. However, we simply don’t operate that way. We want to be completely transparent with you as far as the value of your home. Once we sit down after taking a quick look at your home, WE can decide if a cash offer is best OR if I know I can make you more money while still achieving the goals you have laid out regarding the sale of your home.”
Again, the first step is to get the appointment.
“So, Mr. Jones, I have a few openings this week; how does (pick a day and time) work to come out to your place so I can make sure the numbers that we can show you will be as accurate as possible.”
STEP 2: BUILD TRUST AND RAPPORT
This step is an evaluation of the home.
The goal at the appointment is a simple meet and greet to build trust and confidence in YOU. Take a look at the home and build rapport. Bring up specifics about the neighborhood, school district, average days on the market, and anything else that needs to be considered in the sale of their home.
Explain that the way your program works is that you will do a full analysis of what your investor partners are willing to offer for CASH. You will also complete a market analysis to see what you can get on the open market within their selling timeframe.
Make sure to follow up promptly with their options.
STEP 3: FINAL CALL – CLOSE THE DEAL
When calling the client back, it is VERY IMPORTANT you foreshadow how the call is going to go.
You want to explain that before you want to go over both possibilities and the final estimated net number to them. However, you also need to foreshadow this part with something small, like: “Mr. Jones I reviewed both options prior to calling and I think this will be an easy decision. However, I want to go over both of these first, and then we can go from there.”
You are saying it’s an easy decision because you want the client to list the home with you, and the open market numbers should have a big enough gap, where that will be the option they choose, hopefully. If not, bring the cash offer deal and walk away with a referral fee. It is a win-win.
Once you go over both options, you will then need to explain how the listing process will work should they choose that option. THIS PART IS ALL ABOUT ONE OF THE MAIN REASONS THEY WERE INTERESTED IN A CASH OFFER. SIMPLICITY!!!!
Make sure you are reminding the client of how easy this process is.
“Mr. Jones so let me explain how this works and how easy we will make it for you. All we need is a few docs signed which you can do over the computer or on your phone. From there, our company will order our photos and tours so we can get the property pre-listed and sent to my specific marketing channels. We sell a lot of homes before listing on the open market so hopefully, we can do the same. AGAIN, if we are able to sell prior to the open market with one of your buyers, you will actually make a little more money.”