KGCI: Real Estate on Air - Top 10 Creative Tactics to Clinch the Deal for Your Buyer

Episode Date: May 2, 2024

Hey guys, I am so excited to be back with you wrapping up part two of two in my series of the top 10 tactics to help your buyer clinch the deal in a highly competitive situation. So if you didn't listen yet, go back and listen to tactics one through five. And now I'm going to give you six through 10. And these are some of my favorite things to do to clinch the deal, including how to be really creative and savvy with handling the home inspection to have your offer be as attractive as possible. how to use escalation clauses to your client's benefit, seller rentbacks, and my final two tactics are so good. I'm not even going to tease them. You just need to listen. Let's get into it.

Hey, my name's Tina Belivo, and I am obsessed with all things real estate, growth, marketing, social media, technology, and team building. If you're an ambitious agent who's hungry to grow, work on your own terms, and build a thriving life outside of your business, this is the podcast's for you. I got into real estate when I was 18 years old and grew my business from nothing through referrals and social media. And since then, I've built a top performing team and I've sold over 1,700 homes and $400 million in sales volume. In this podcast, I keep it real and I tell you exactly what I'm doing to sell tons of houses, lead my team, market my brand, grow my social following and database, and maintain incredible work life balance. I'll never shy away from sharing my

biggest mistakes as well as the juicest parts of my secret sauce. Pull up a seat and get ready to learn and be inspired. This is the High Performance Agent Podcast with Tina Belivo. Welcome back to the high performance agent podcast. I'm your host, Tina Belavow, and we are picking up right where we left off in a two-parter. This is part two of two in my episode series on the best and most creative strategies to get your buyer the house in this very competitive market that we are all living through in most parts of the United States and probably other parts of the world too. So if you didn't get to listen to part one, I gave strategies one through five out of 10. And now we are going to get to 6, 7, 8, 9, and 10. And I just have to say, I feel like they get better and better as they go.

I don't want to oversell it, but just keep listening. Strategy 6 on getting your buyer under contract is to be smart and creative about your inspection choices. And I'm going to outline for you what I mean by that. So part A to this strategy would be if you're in a situation where you can just completely waive the inspection, that is going to put your buyer in a winning position. That may not be prudent for them or for the house. So that is not an option that always makes sense. But it's an option that you should at least explore and discuss with your client. If that's something that you can do in your market and your broker approves, I feel like I need to give all these like disclaimers just because every locality and state is different. So that would be the strongest thing is to not have an inspection.

Is it in your client's best interest? That's a totally different conversation. I think that really depends on them, on their financial resources, on their housing acumen, on the age of the house, the condition of it, and a lot of other things. And I think it's our job as agents to really advise people around that stuff and not tell them what to do, but help them think those things through and how something that may sound like a bit of a leap, maybe could make more sense after all. For example, I am a very conservative person. I never ever thought I would be someone who would buy a house without a home inspection, but guess what? I did it last year. And I live to tell the tale. So last year, and I referenced this in part one, my husband and I bought our dream beach home

in Hilton Head South Carolina. Side note, we do Airbnb the property. It's an awesome three-bedroom if you ever want to go stay in the best island in the United States. And that's a whole other podcast, too, is Airbnb Life. So we waived the home inspection. We bought the house site unseen besides a very brief face-time tour. And the thing I want to say to you is don't make assumptions. I asked my listing agent if they're, I think I must have known that it had a prior contract that fell through or that came up by, again, me asking lots and lots of questions. And I said, hey, can you ask the listing agent if they're willing to provide the prior home inspection as well as the termite report? Because if they're willing to provide it, we might be happy to completely waive the inspection.

And again, every listing agent and seller might have a different answer to that question, but they were like, sure, here you go. They sent me everything in PDF. I read it all. And I felt like it was a calculated risk that I was comfortable with taking. And I have no regrets. Does the house we bought have some issues above and beyond what was in that report? Yes. But it was a calculated risk. I don't regret it. I just, I calculated that risk. Like I just said, there's a good chance there are some things that aren't on here. And there's stuff that's never on the inspection report that always comes up. So I budgeted and set my personal expectations accordingly. And again, live to tell the tale. Here I am doing just fine. We've definitely had to put a little more money into the house than I hoped on a maintenance level. But a lot of that

didn't even have much to do with the inspection report. It just had to do with the house itself. And also learning that beach houses just have like way more wear and tear than Baltimore, apparently. And that's all just part of the learning curve. And that's, again, maybe a little bit of a different topic. But I think educating your clients in that way, give them the option to think about it. Maybe you waive the inspection completely. Maybe you're able to get your hands on certain reports or pieces of information. Or maybe you can just ask some really good questions of the listing side that helps you tailor your inspections in some way where it's at least as attractive as possible. And that really flows into my second option is if you can't waive the inspection overall, can you limit it in some way

that shields the seller from risk and time and headache and hassle? For example, idea number one, can you let them know that you are willing to buy the house as is as long as there are no major issues found in the inspection? Every state is different. We recently had a major change in the contract paperwork in Maryland in the way this is kind of outlined. But just, setting expectations, like literally saying we will not nitpick, we're only looking for something catastrophic. That may or may not be something that can be written into your contract, depending on how you guys do things in your market. But setting expectations and letting people know where you're coming from in a negotiation can be really powerful. Another option is to consider only

doing the regular minimal inspection versus telling them that we want to check for mold, radon, asbestos, check the pool, check this. Oh, and definitely we're, going to check the 5G waves. And if you guys are laughing, let me tell you, two years ago, I flipped a house in my market and I have sold a lot of houses, okay? This was a new one. The buyer agent, I'm still just dying over this. The buyer agent called me after the showing and was like, the buyers were in the backyard and they noticed up on the phone pole that there's like a 5G transmitter. I don't even know the right term because it's so silly in my opinion. And they're nervous about buying the house. They really love it, but they don't want to be too close

to the 5G waves. And they might do an inspection for it or test it with some sort of meter. And I was like, you have got to be kidding me. Ironically, those people actually bought the house and it all worked out. But like talk about being a listing agent and getting a call that someone wants to do a specialty Craig Cray inspection. And like, so just to kind of back up and get out of story time, in our market, you can kind of check off which inspections you intend to do in the contract. So maybe there's a scenario where you have a conversation with your client and say, listen, yes, you could check for all of these other things. And maybe you should and you need to decide, I'm not telling you not to. And I would also document

this in an email. But just know that if we were to just give a cleaner, more straightforward approach that we're really only checking on that the roof isn't caving in and the structure is good and that the electrical and the plumbing are functional and that we're really looking at like more the bones of the house versus all the things that would be ideal about it that could really help us be the winning buyer and again i referenced this in part one of this episode we just had a listing that got 14 offers of those 14 12 of them had really weak inspection terms in some shape or form a lot of buyers initialed that they were going to do every inspection under the sun and check for lead pain and this and that. And again, all of that is valid in a different market.

But if you need to be highly competitive, it should always be your client's choice what they do and don't do. But you want to give them options and give them an opportunity to think about it and set themselves up for success and make an educated decision about which risks they're willing to assume or not assume and deal with after they buy the house. A couple other strategies to be creative with your inspection choices is maybe you need to do all the inspections. Can you limit the timeline? For example, if it's standard in your market to do all the inspection within 10 days, can you offer to get them done in three or five? Yes, it's a hustle,

but it can be done. It can absolutely be done. In fact, one of my favorite things to do is to preschedule the inspection at the time of the offer and let the seller's agent know that we are already holding a time on such and such date. And if we go under contract, the inspection will be done by then. So say today is Monday and I'm submitting the offer Monday and I know they're going to decide by Tuesday, I will schedule the inspection for Wednesday at whatever time I can get with my inspector and works for my buyer and say, hey, we're doing the inspection the day after we go under contract, I will call you when you're done and let you know if we have a catastrophe or not. Just know that we're going to make this smooth and fast. and it's going to be a two-day turn time.

That is such a different risk level than waiting 10 days. There are so many ways to kind of like skin the cat. It's a weird phrase, but I find myself using it from time to time. Apologies to the cat lovers. But like you just, it's all about being like proactive and creative and communicating and helping people see that you're going to find a way to make it all work. And even just that little bit of enthusiasm goes a long way. I actually, as I'm telling you this, I'm like, yeah, we just bought a house.

and I pre-scheduled the inspection. It was the exact scenario, I'm telling you. I think we went under contract late Monday night, and we inspected on Wednesday morning. Also, it really helps to use a great inspector in your area who both does a great job, but also who listing agents really like. We use this inspector in Baltimore that's been around a long time.

He does a thorough job, but he's also just really amicable and reasonable, and everyone loves him. That is in our offer presentation letter, saying, again, the inspector is the buyer's choice. Usually they're fine going with our recommendation and just letting them know, hey, by the way, this is who's going to do the home inspection? Because I'm sure if you've been selling homes for a while, you know what it's like to be on the listing agent's side and then find out that the nightmare inspector is coming, the deal killer guy,

the problematic inspector. So I just let people know up front who all the players are, the lender, the title company, the inspector, how awesome our transaction coordinator is. And I just set the tone own that like this is all going to be good and it's not going to be perfect, but I'm going to make it good because it's my job as the agent to make things go well and be organized and be on top of problems and be proactive and solve them. And I think that level of like confidence and energy can be really contagious. So that is tactic number six. Be smart and creative about all of your inspection choices. Don't just do the default because that's what you're used to. Back up and think this through. Okay. Okay. So,

Let's talk about Tactics 7. Now we're getting into some of the slightly more creative stuff. This one is not going to be news to most of you. It's use an escalation clause if that suits the situation. And that's the real asterisk that I want to give you. I think most markets have a standard escalation clause. First of all, I always explain this to buyers where I'm like, it's the eBay addendum. Basically, what it says is that you will beat any other offer by a certain amount of

as long as it doesn't exceed the cap that you preset in advance. And people usually go, oh, got it. Like they can kind of just wrap their head around that. I will say sometimes clients have a little trouble understanding it or they do have a valid concern, which is if I give them my max up front, can't they just counter me at that or am I showing my hand? And the way the escalation clause is written for the Maryland contract is that they have to show proof of the other offer to trigger the escalation. So it doesn't fully protect you from the

phenomenon of someone just countering you back at your top. But again, like, if someone counters you back at your top number, that's an opportunity for dialogue. That's an opportunity for you as the buyer agent to say, that's not the way the escalation clause is written. Do you have other offers? Do you have proof? Are you willing to furnish that? Or are your seller just trying to negotiate? And then maybe you keep the dialogue going and settle on some other number. But at least your buyer had the chance. depending on how competitive it is, I think that can be a really powerful thing. So check if this can be done in your market, if you've never heard of it. Talk with your broker.

The second thing that is important to do in Maryland is escalation clauses are an optional addition to the contract. They're like a separate addendum. Check with the listing agent first. Some listing agents hate escalation clauses. They don't like them. They don't like to present them. now as an agent, our duty is to present whatever we're handed. But again, I talked a lot about this in

part one. You want to make the listing agents job easy and kind of suit their working style as long as it's not like a major detriment to your client. So some listing agents say, you know what, I don't want escalation clauses. I just want your best and final. And then I'm like, really, are you sure? Because like I will definitely make sure that's a hard and fast. But if that's what someone tells me, I may not use it. Or I'll go to my client and say, I know we want to use this clause. And then I'm like, However, they would really prefer a clean best and final. The main reason people don't like the escalation clause in our market is because there's two parts to it.

Number one, they have to show proof of the other offer. So it doesn't give the seller as much power as more of a blind offer situation. And then also there is this process where the seller kind of counters the higher price. And then the buyer needs to sign it and reaffirm the higher price. So sometimes the deal can break down in like that signing and follow up signing process where maybe someone has a change of heart or it takes too long. And then your second best offer pulls out. So there's like a risk level associated with it. It's not high, but some people just would rather have a clean situation. Give me the top number. We can sign it. And then it's a binding contract.

So think about that. So I think there's a lot of nuance to everything that I'm trying to share. with you in these episodes, and I want to help you think more strategically and then help your clients think strategically and make empowered decisions. And on that note, I do have one other tip on escalation clauses. Make the amount that you will beat another offer by a meaningful amount of money. So if you're dealing with a $700,000 house and then you submit an escalation clause saying, we'll beat your best offer by $500 or $1,000, it's not. It's not a $700, it's not a meaningful amount of money in context to the purchase price. So you want to be in context to the purchase price. And you also just want it to be meaningful, period. $500 or $1,000,

yes, that is real money. But when you're weighing all of the things that, you know, offer stack up against each other, there may be another offer that is only $1,000 less, but the buyer agent's friendlier, the contract was cleaner, you know who their inspector is going to be. There are all these like soft sides to the, to the qualities of the offer that factor in. So you need the dollars in the escalation clause to mean enough and be big enough to really override those kinds of concerns. So I'm a big believer in thousands for escalation clauses. Ideally, like 5,000, something where someone's, yeah, like, you want the seller to go, yeah. That's my pro tip for the day. So that is tip number seven.

Use an escalation clause, but do it strategically and judiciously. And again, you want to embrace the best practices for your market. Strategy 8 is offer a free rent back for the sellers for as long as your buyers can stand it. Not every seller needs a rent back, but I find that they need them more often than not or they appreciate them. It can even just be a great gesture if they're not exactly sure where they're going or when. So it's really as simple as that. For as long as you can stand and afford it, say, hey, we'll settle in 30 days so you can get your your money out, but we will let you rent back for one, two, three, four, five months. Like, I'm throwing out some big numbers here.

But the house that we just bought, my husband and I unexpectedly bought a new house, kind of like an upgrade in our neighborhood, way better a lot. Can't wait to talk about that sometime. And the sellers needed a rent back for two and a half months. And I had at first thrown out that we would just come up with a reasonable number. Their idea of reasonable was to stay there for free. And it was a tough pill for me to swallow at the time of going under contract. we had come way up in price. We had made a ton of other concessions. When we were in the middle of

negotiating, the listing agent disclosed to us, oh, by the way, the HVAC system is shot and needs replacement. I was like, oh, great, that's 10 Gs that wasn't factored in. It was one thing after another in the negotiation of concede. And then it was like, oh, yeah, we're not paying you for the rent back. So it was not at all convenient or helpful for us. It's actually becoming a new headache right now where I probably won't have easy access to the house to plan the renovations, but it was essential to sealing the deal. So again, like, I think just making fully informed decisions about all of this is important. And then I say this to my clients all the time and to myself.

Like a year from now, I won't even remember. I'll remember the red back, but I won't remember how I felt. The sting that I might be feeling about certain concessions will be so forgotten in context. of having bought the right house for me and the future of my family. So there's a lot to be said for future pacing is kind of a term for that of like just thinking ahead to will I still care about this in a year or will I look back and be glad that I did the things to make it happen. And that's a great way to kind of get out of emotion and into logic and figure out, help your client figure out what is going to be right for them long term and not letting

the short term hassles of the transaction make them crazy. So that's strategy eight, free rent back. And if you can't do free, maybe heavily discounted. Just something as win-win as you possibly can. Strategies 9 and 10 are my favorites. So if you're still listening, I'm glad you stuck around. Strategy 9 is offer a signing bonus to the sellers. So you can structure this however you want and however your client is comfortable with. But basically, it's giving your seller the seller extra money right after you under contract.

So I heard about this somewhere. I think I'd seen it in a Facebook group. I've made a note to self on it, never used it. And here I am talking about my Hilton Head property again. Last year when we were trying to pull out all the stops to be the winning buyers in a competitive situation ourselves, I said to my husband, I was like, Andrew, like, I want to do this thank you bonus thing. And I want to basically say that we're going to just wire them $1,000 within 24 hours of going under contract, just above and beyond, extra money, totally not refundable or contingent on whether we even make it to closing. And I brought it up to my agents and they were like, whoa, never heard of that. That's kind of weird, but cool. Let's do it. And I'm like super type A.

And I was like, okay, I'll draft up the language. And I just made up my own language saying, as a thank you for accepting our contract, we will wire you $1,000 within 24 hours. And we will send a bank wire, a Venmo, a PayPal, whatever. I think I ended up overnighting them a check, which was actually super annoying to do that. But it's all good and totally worth it. And here's an even better story. So that was in 2022. And then in spring of this year, I was actually working with one of my team members clients. My team member was on vacation. I kind of stepped in and was helping her try to get this house that she wanted very badly here in Baltimore. It was so perfect for her. The kind of of thing where if she didn't win the house, she would maybe never completely get over it. And I know we

always get over it. But like, we needed to make it happen. So I, again, I have this like archive, this list of all my best ideas. And I went back and re-reviewed it. And I was like, you know what? I think you should do the thank you bonus. And I explained to her what I just explained to you. And we decided to go big. And it was a unique situation in that she had actually seen the house before it went on the MLS. She like literally met the sellers on the street. It was one of those like meant to be kind of things where they like let her through the house. And then it was in our MLS and coming soon status where it's not even supposed to be shown to anyone yet. She had just happened to see it even before that happened. So we basically needed to convince the sellers to take her offer without going to market

and missing out on a possible bidding war and all the things that can happen when you get all these crazy terms. So our offer was killer in every way. But the thing that pushed it over the the edge was basically the sellers were waffling. They just, they couldn't quite commit to taking our offer, even though the terms were great overall. And then I said to her, you know, we need to do this thank you bonus. And it needs to be meaningful. So we went ahead with five grand. And by we, I mean she, it was her five grand above and beyond just from her bank account, separate from the price she offered and all the amazing terms. And that is what sealed the deal. And the sellers just took her offer. They never went to market. We never had to deal with the bidding war. And she got the house. And I can promise you,

she has no regrets. In fact, she was super impressed with the creativity of the idea, even mentioned that in her testimonial and is just a raving fan of our team now, which I love that. So that's cool too. But that is strategy nine, offer assigning bonus to the sellers. And we're going to come, we're going to wrap it up here with strategy number 10. Listen carefully. Okay, stay with me. We've all heard of seller help, right? And And seller help is where the seller helps the buyer by giving them a subsidy at closing. So this is a turn the table situation. Buyer help is when the buyer helps the seller.

This is something that we made up. It was like an idea that we had when like we got into the pandemic crazy and we were like offering someone a great price on their house is awesome. But how can you do something that goes right into their pocket isn't quote, taxed by commissions and transfer taxes isn't subject to an appraisal and it's just cash money in their pocket at closing above and beyond. That is buyer help. So this is a lump sum where the buyer basically says that they will credit X thousand of dollars back to the seller closing to cover the seller's closing costs. The sellers are normally paying the commission, transfer taxes,

whatever else is traditional in your market. It's a lot of money. So you want to, again, taking it back to what I said about the escalation clauses, make it a meaningful amount of money. Don't offer $500 in fire help. Make it thousands. Make it matter. And this is so powerful. This is my favorite tactic. We have won many bidding wars using this tactic. I'm almost like, sometimes with my podcast, I'm like, do I really want to give out my best ideas? But I also just believe in spreading the wealth. So whatever. But this has helped us win so many deals. listing agents are almost always shocked. They've never seen it before. And I actually have a caveat to give you, which is make sure you explain very clearly in your offer presentation what buyer help

is. And you obviously need very clear, strong verbiage to like work that into your contract. But someone who is unfamiliar with it or maybe even skimming and not like really busy, they may like reverse it in their mind and think that it's a credit from the seller to the buyer as opposed to a credit from the buyer to the seller. So it is something you want to articulate very clearly. Ideally, touch on in a quick, like, offer presentation phone call and just say, our buyers want to go above and beyond. We want to make this such a win for your sellers. We want to put an extra $7,000 in their pocket, $5,000 in their pocket, above and beyond, the price, the appraisal, everything. So basically add that to your net. So our $600,000 offer is really a $607,000 offer,

but that $7,000 is just guaranteed right into their pocket separate from the purchase price and the financing. And your seller won't even pay commission or transfer tax on it. At least that's how it works when we do that here. So that is buyer help. So thank you for hanging with me. I'm a little bit caffeinated. I went really fast. If you want this full list in writing, head to my show notes. There's going to be a little sign up form and you can fill it out and I will email you these 10 tips for you to refer back to. And again, come chat with us in the Facebook group. And if you want to get, again, like more personalized, comprehensive mentoring with me, check out my high performance agent academy, join the wait list, would love to chat with you about it. And I'm going to wrap up here.

Thank you as always for spending this time with me. And I look forward to chatting with you again very soon.