If you Want to Maximize Your Sale Proceeds, you Must Learn how to Handle an Inbound Buyer Lead

Copyright © 2014- 2019  AUTHOR: Paul R. Marino, REALTOR®, e-Pro®

 

This is a critical article. Why? Because it's going to provide an actual, provable example of how you can double your home sale commission savings. Let's talk real numbers here, and use actual transaction specifics involving an actual Landfall Properties, LLC listing client.  The property involved in this transaction is located at 4 Thatcher Lane, Amherst, NH 03031. This is a NH example, although this same scenario is available anywhere Landfall Properties, LLC holds a brokerage license, currently CT, FL, MA, ME, NH, and VT (coming soon to RI and NY). It was listed for FREE in the New England Real Estate Network MLS (NEREN MLS) in the 2/6/2016 timeframe for the sum of $459,000. The owner, John and Paula Learoyd, uploaded their house data and photos on 2/5/2016, and the very next day, saw their home listed on hundreds of websites across the Internet.

 

After being exposed on hundreds of websites from 2/6/2016 through 4/5/2016 (60 days), the market concluded the price was elevated. The Learoyd's subsequently upgraded to our Premium Marketing Service on 4/13/2016, re-listing at $449,000 ($10,000 price reduction), which led to an offer on 4/24/2016. A fully executed contract for $435,000 was negotiated later that day between the parties. Because John and Paula Learoyd would be paying 0% listing side commission, and 0% buyer side commission, they could afford to be more aggressive in their pricing, since they were saving a whopping $26,100 in commissions. (6% of $435,000).

 

We want you to know we're talking about an actual transaction. If you like, you can simply "Google" MLS 4470259.  Try it.  Your computer screen or smart phone will light up like a Christmas tree. Your search results will immediately return numerous page one instances of the sale at 4 Thatcher Lane, Amherst, NH, which closed at $435,000 on 6/30/2016.  Just a cursory examination of the search results proves to you that this home was being marketed on many, many different real estate brokerage websites, none of which I might add, had anything to do with the sale. Notice that any contact information references to the actual listing brokerage (Landfall Properties, LLC) is mysteriously obscured from these property displays. Why is this?

 

It works like this: Once you're listed in the Multiple Listing Service (MLS), the various property search websites like Realtor, Zillow, Trulia, Redfin, Homes, Homefinder, etc. simply vacuum up all the data posted by the MLS, repackage it, then post it to all the individual search, brokerage, and agent websites. Hundreds of them. Any every one of these brokerages is hoping you will somehow believe there is a "connection" between them and the particular listing. There isn't. There is of course the obligatory reference to the listing brokerage (Landfall Properties, LLC) in this instance, but there is no name of the actual broker (i.e. Paul R. Marino), and certainly no email or phone number to call him. Selling real estate is all about putting as much "bait" in the water as possible. Property listings are the "bait", and you, the property buyer, are the "fish".

 

Just an FYI to all you buyers out there looking for property. If you're looking for a home to purchase, stick to the "Big Three" - that is, Zillow, Realtor, and Trulia. Of course there are hundreds more, but for the most part, they're minor players. Why? Because almost without exception, every home listed in the Multiple Listing Service is replicated out to these three huge property search websites. Zillow contains the most comprehensive set of property listings, because it lists not only those listed by agents and brokers, but it also lists those uninformed sellers that have decided that going it alone without a licensed broker is the smart play. It's not. It's actually going to cost you MORE money. Read my post. Realtor is next largest, lagging slightly behind Zillow. And in third position, there's Trulia. Of course Trulia is owned by Zillow, so it's basically a horse race between Zillow and Realtor.

 

But let's get back to our example, and see precisely how this seller saved $26,100. Like many, many successful home sales, the sale all started out with an inbound lead. In this particular instance, a buyer, searching the Zillow site, stumbled across 4 Thatcher Lane, Amherst, NH, and decided to take some action. They decided to click on the button next to the listing broker (Paul R. Marino), and ask a question. And the question was: "Is there any chance we can see this property on Saturday at 11:00 AM?  So, what happened next? Zillow routed that lead to Landfall Properties, LLC. And Landfall Properties, LLC immediately bounced the lead to both the cell phone number (via text) and email address of seller John Learoyd. It is important for your to know Landfall Properties, LLC does not intercept buyer leads. I can't emphasize that enough. By contrast, we aggressively make sure you see each and every lead.

 

In the lead message generated by Landfall Properties, LLC that was immediately routed to John Learoyd, we instructed John to ask this critical front end question: "Are you working with a buyer broker?".  Your hope is that the answer to this question is: "No". Why? Because if no broker of any kind is involved in the sale, the home seller will (as happened here) pocket the entire $26,100 (6% of $435,000). As many of your are aware, roughly 80% to 90% of all home buyers find their own property by searching the Internet themselves. Somewhere along the line however, a buyer broker will typically get involved.  Buyers do this because they perceive they have no one in their corner to be their advocate and go to bat for them. So they bring in a buyer broker. And sometimes, this is the smart play. A lot depends on the experience, sophistication and temperament of the buyer and seller parties.

 

In this instance, Landfall Properties, LLC instructed John Learoyd to say to the buyer: "As a buyer, you likely want someone to represent you in this transaction. Instead of a buyer broker, might I suggest an experienced real estate attorney." Now why did Landfall Properties, LLC do this? For one thing, it's good, sound advice. The attorney can review the contract, make sure there are no "gotchas" in the Purchase & Sales Agreement, and review the Closing Disclosure (CD) document in advance of the closing to ensure accuracy and fairness. And, based on my experience, you can find attorneys all day long that are happy to do this for less than $2,000. If the buyer continues to waiver, and is about ready to pick up the phone to a buyer broker, throw this out there: "I (the seller) will pay for your attorney. Select any attorney you like. On the CD, your $2,000 attorney expense will be a line item deduction from me, the seller."

 

By doing this, the entire cost of selling your home is a paltry $2,000. You just saved yourself $11,050 on the buyer end, since a 3% buyer broker commission would have set you back $13,050. Plus, on top of that, you paid exactly 0% to the listing brokerage, saving you another $13,050.  As it turned out in the transaction just described, the $2,000 offer was not even necessary. So, in the end, John and Paula Learoyd ended up paying a 0% listing side commission, and a 0% buyer side commission. Total savings: $26,100. This is real money.

 

Now it may seem like I'm beating up on both listing agents and buyer agents. Actually, I'm not. While most people can easily bypass a listing agent in their home sale by using our FREE Flat Fee MLS listing system, reliance on the buyer broker community is critical to the success of most home sales. This is because the vast majority of home sales are connected to a traditional listing agent that has already put in place a full fee commission with the seller, generally ranging from 5% to 6%. As such, that seller is locked in, and is going to pay that 5% to 6% one way or another, whether a buyer broker is involved or not. And since most homes are listed under this 5% to 6% structure, it makes little sense not to take advantage of buyer broker services, since they're generally free.

 

In the case of Landfall Properties, LLC, we actually pay you a cash rebate amounting to 25% of the buyer broker commission. In fact, Landfall Properties, LLC generates so much goodwill from saving home sellers money, that nearly 70% of successful home sellers end up utilizing our buyer brokerage services when buying their next property. And, because we're licensed in CT, FL, MA, ME, NH, and VT (soon to be RI and NY), we offer our clients great flexibility as to where they move to next.