Using LO's As Lead Source?

[PhxGuy]

I'm a new agent and have been trying to do open houses every weekend here in Phoenix with no results. I have 4 years experience as a LO and wanted to contact LO's here to offer my services. My niche(please no offense to one) would be I would be loyal and trusting with their client. Meaning the biggest reason most LO's hate agents is becauase the cannot trust them to not take their client to another lender. When I worked as a LO we got tons of new buyer leads but didn't pursue them because trusting a agent was almost impossible. Not the mention the EGO!

Does anyone contact them or have a good plan of action?

[BarryC]

Ok, my post is going to be a little off topic, but bear with me here.

Before you abandon the open house idea here's some things to think about. Have you spent the time and researched what goes into having a successful open house?

You're a new agent, so I'm assuming that you're holding other peoples listings open. If you work for a large company with lots of listings, don't just settle for any listing.

Tips for picking open houses:

1. Really do some research and pick open houses where people want to live, prefferably vacant homes. It looks like you are in Phoenix so pick places like Kierland, The Biltmore, Desert Ridge, McCormick Ranch, Grayhawk etc. etc.

2. Next, make sure the house is located where it is going to generate open house traffic. In other words, houses that aren't too far from busy roads.

3. Make sure the house has nice curb appeal so you have more of a chance of people getting out of the car and coming in. You're in Phoenix so make sure to pick a ranch style home. Most people here prefer these as opposed to multi-story homes.

4. Pick a house that is a good value for the neighborhood. This will dramatically improve your chances of getting the home sold.

5. The more turn-key the home is, the better. Buyers have a mental checklist, and once they decide there is just too much work to be done on the house they will move on quickly.

Preparing for your open house:

1. This one is really important. You need to go out and preview all the homes in the area where you will be holding your open house. Get to know the inventory, and know it well. Make notes for each house regarding special features. When done, prepare a book with all the other available homes in the area by price, square footage, or whatever works for you. You will want to have this at your open house for people to browse. Know the inventory like the back of your hand. You need to be the expert.

2. Put out a lot of signs pointing people to the property. Don't be lazy and just put them on the corners. Put the signs maybe 50 yards before the intersection in both directions with a few balloons attached to them so people have time to get into the turn lane to come view your open. If the signs are just on the corners a lot of times people will pass them and decide it's too much trouble to get turned around to go look at the open house. Oh, and the balloons may seem cheezy but people will take notice, and know that the house is really open that day and some bozo didn't just leave some signs laying around. Remember, your time is your money. The more signs you put out, the more chance you have to get clients in the house. Also make sure your signs are really stable. There is nothing worse than spending the day at an open house with very little traffic just to find out that the wind knocked over a few of your key signs so no one could find the property.

3. Make sure you pull the flyers from the flyer box in front of the house. Also, don't use the other agents flyers. Make your own. You want people to contact you if they have any additional questions.

4. This may seem obvious, but dress the part. I know it's hot here but don't wear jeans, shorts, etc... People want to do business with other people they deem as professionals.

5. Print out 100 invitations or as many as you feel like doing to your open house and walk the neighborhood and pass them out to neighbors. Tell them that if they know of any friends or family that might be interested in a home in their neighborhood to let them know. Also, let them know they can stop by if they just want to see what their neighbor has done to the house, or want some ideas for decorating. What you're doing here is primarily creating listing opportunities. Many neighbors will visit the open house because they are thinking of selling and want to get an idea of the competition, and what other homes in the neighborhood are listed for. This is where you hit them up with a no strings attached offer of a market analysis of their home. Let them know you can stop by after your open house to take some notes to prepare a report for them.

At the open house:

1. You need to memorize and ask potential clients qualifying questions. How long have you been looking for a home? Do you live in the area? Have you found any homes you like yet? If so, why didn't you write an offer? Are you working with another agent? What's his name? How come he's not with you today? If their from out of town, are they relocating? When will they be relocating? Where do they work? Is the commute time important to them? If they live in the area, do they live in the same subdivision? Are you thinking of selling? When will you be selling?

I'm sure you get the picture. Obviously don't bombard them with questions all at one time, but remember you need to qualify these people and build a rapport.

2. Again, this is the point that it is crucial to know your inventory. When people say things like "we want something with a three car garage," or we really want a heated pool with a hot tub," or whatever the case may be, this is your time to shine. If you know your inventory you will know the house that they are looking for, and be sure to sell them on it. Tell them what time you will be done and make an appointment right there to show them the house. Get them excited. Also, make sure to ask the question about whether they are working with another agent and have them sign a Buyer Broker Agreement for any houses you will be showing them that day. Your time is valuable.

3. In additon to knowing your inventory you need to know the area. Know what grocery stores are around and how far they are from the house, know the names of the schools in the neighborhood and where they are. Know where the parks are. Know where the freeways are and how long it takes to get there.

4. If the house has any potential pitfalls, have solutions for the potential buyers. If the house doesn't have a pool, know how much it's going to cost to put in a new pool. Research pool financing, so you can tell buyer's how much additional out of pocket monthly a new pool will cost them if they decide to put one in.

If the buyers want to put in new flooring , know how much it will cost them (ballpark) for new tile, wood flooring etc... Know the great flooring shops that have great deals and installers that do great work for a reasonable cost.

If the block wall is kind of low, know what the city and HOA ordinances are for how high block walls can be. Know how much it will cost to have the wall built up.

5. Don't waste your time telling potential buyers that the house has granite countertops or a 3 car garage. Most people are smart. They can see that stuff with their own eyes. Tell them about what they can't see. Tell them the HOA is ridiculously low for that subdivision, or the elementary school is right down the street within walking distance for their children, or a police officer lives right next door. Tell them about the new roof that has a 30 year warranty or how the homeowners put in the maximum insulation upgrades that will save them money on their electricity bills. Tell them about the salt water system on the pool which gets rid of the need for adding chemicals like chlorine.

6. Don't be afraid to ask the tough questions. You have nothing to lose. Ask for their business.

7. If you can't get their contact information or set up an appointment of some sort have something of value to leave them with. If it's a neighbor who is thinking about selling in the future, have information on your flyer pointing them to your website for a free market analysis on their home. Tell them no agent will be calling them and a phone number isn't required. If it's a potential buyer, point out on your flyer how they can get set up on an automated email home search where listings that only meet their criteria will be emailed to their inbox right when an agent presses submit on the MLS. Again reassure them that no agent will be bothering them and they don't even have to put in their phone number when they set up the search (of course you will have to have these forms set up on your website) . Remember, this is only if you can't set up an appointment. It's much more prefferable to do the market analysis at their home, or set up an appointment to show them houses. I have set people up on automated email searches and basically forgotten about them because they didn't want to give me any contact numbers . Later on they have called or emailed me saying they want to see a home that I sent them via email and we go over and write a contract. Not a bad return for setting up a search.

In Conclusion:

As you can see, there is so much more to an open house than just putting up a couple of signs and hanging out for a few hours. If you devoted yourself and sat open houses 4 or 5 times a week using some of the items I have outlined above, there is no reason why you can't have a six figure income your first year in real estate. It's a lot of hard work but is definately attainable.

Your also on REW so I'm assuming you're putting together your own website. Take your laptop with you to the open houses, and spend all your downtime working on your site. In a few months I bet it will be rocking.

Also, use your experience. You were or are an LO so engage in conversations regarding financing. If their first time home buyers with little savings, tell them about the My Community program, FHA etc.... Tell them it's no problem getting the seller to contribute 3 percent towards their closing costs.... Talk to them about not closing credit cards when they pay them off so their score won't temporaily drop. Tell them to keep their credit card balances under 30 or 35 percent of their total credit limit on the card. Tell them about the 100% financing options that are still available. If you're still a LO let them know that you will do the deal at a par rate if they buy a house through you (of course that is up to you, but that would be a pretty good marketing idea).

Oh, one last thing. Don't be afraid to keep on following up even if you don't get a great vibe right away. There are so many sales lost in this industry due to not keeping in contact with potential clients.

As you can tell, I couldn't sleep tonight. I am tired though, so hopefully the post makes sense. Now maybe someone will actually post a respone to the question you asked. Haa.


Good luck.

[RESteve]

Barry,
I haven't taken the time to read you post, but kudos for sharing your knowledge in depth like that. This is what this community is about!

[BuyHawkeye]

Wow. Maybe off topic, but still impressive. Hopefully, you have made it less specific and posted in on a blog.

I do both (agent and LO) so I know what you are asking. But I think your experience as an LO varies from mine. I have a couple of really good agents that I can call up on a moments notice to hand off leads to. So I don't know why you can't find the same with a particular LO. It just takes striking up a relationship.

Best of luck.

[PhxGuy]

Barry C, Thanks so much. You've given me some good ideas. But I've not given up on open houses. I just want to add effective efforts to produce some results.

My plan of action has been as follows:

I've been contacting fellow agents within my company who have vacant listings in areas that have seen a lot of activity. Recent sales at a moderate price level(200k-225k). Then I choose a home where it's close to major streets and and has easy access to get in. Once there I place signs with balloons attached at any major or minor street leading into the home. I even bought a "come in, were open" sign for the door. People seemed to be hesitant to walk in. As far as comps information I pull the most recent sales and the current comps and active listings for that area. In terms of qualifying ,you basically took the words right from my mouth. I do have a "buyers wishlist" attached with my card and tell them to email me the criteria and I'll send them homes with their preference. I think I'm going to have a "email" list and have them sign it instead to take a more proactive approach.

Again thank you for your input. Based on what you read, how can I tweak what i'm doing?

[AmberEyez]

I'm a fairly new agent and as my market is swamped with agents, I still do open houses for listing agents. I've had a few listings, but not nearly enough.

Although my first obligation is to try and sell the house that we are marketing, the home in question will not be appropriate for 85-90% of the prospects. For those who are interested in the house being shown, I call back within 1-2 days. I usually wait 24 hours so that the buyer doesn't feel as if I pouncing on them.

For those prospects who are not interested in the house in question, I discuss other homes in the immediate neighborhood and homes of comperable price located in other neighborhoods. I try to nail down exactly what it is they are looking for and then follow up with phone calls one to two days later. I always have listing sheets with other homes in the neighborhood on hand with my card stapled to it. If I have time I discuss these homes with them. By the time they leave, they know that I am knowledgable and capable of helping them. It has worked well ....until recently.

the snag I am hitting is with an increasing number of prospects ONLY wanting to deal directly with the listing agent. After spending all that time setting up signs, putting brochures together (I make my own for each open house) previewing homes in the area, learning each market inside and out while basically lightening the load for the LA - I find this very, very frustrating. Last week I did an open house for an agent. 23 people showed up and four people called, but they all called the listing agent directly and although she tried to steer them towards me - they ONLY wanted to work with her and ONLY on the one listing.

I think in a slowing market, buyers feel that they can negotiate the price better by working with the listing agent. They feel the agent will reduce her commission if she can double-end the deal. If this trend continues, I will stop doing open houses altogether. I'm assuming that these buyers are doing the same thing for every home. They don't want an agent to work on the buying side because they think they can "save money" by not having anyone represent them. This is probably why I can't convert as many of them to buying leads. If this trend continues, I too will hang it up with respect to open houses. Its far too much prep work for me to continue if the results are nill.