November 15, 2011 in Investing In Real Estate
I would like to think that there is a fool proof formula for putting deals together; one where sellers are agreeable, easy to work with and everything goes according to plan. But the truth is that it rarely happens that way. Today I want to talk about the psychology of putting REI deals together.
I Often Find Myself in One of These Roles
–Peacemaker. I have to step into this role most often when working with probates. Many families find themselves at odds with each other when it comes to settling the estate. Emotions are raw, and the chore at hand is one they are forced to deal with. My role with probates is typically just to look at the facts and try to get everyone to focus on them rather than emotions. I am the first to admit that this can be tough.
-Reality Presenter. I’m not sure this is even a legitimate phrase, but that’s a job I find myself doing a lot. This is definitely where the psychology of putting REI deals together comes into play.
Home values are rarely what sellers think they are. But many sellers think this only applies to “other folks”. Absentee owners often have no real idea what their property is worth. Getting them to accept the reality of the “new” home values can be hard to do. But if you’re in this business for the long haul, this is a skill you have to develop.
–Listener. The ability to listen to folks spill out their problems often for what seems like an eternity is an absolute necessity. And when they call you again next week or next month and repeat the same stories, you will have to listen to them again. I have found that not only do you often discover what their true motivation is during these times, but it helps them to move one step closer to being able to deal with whatever problem or obstacle is holding them back.
–Concierge. That may be overstating a bit what we do but it’s pretty close. Absentee owners in particular often need you to help them with things since they are out of state. Some of the things I have been asked to do in the past include:
- Meet a locksmith and get keys made
- Arrange to have a meter installed on a property that had been stolen
- Meet the pest control people
- Arrange to have unexpected water pumped out of a basement
- Meet a structural engineer
- Find someone to cut grass and weeds that were 6 feet tall on a property
- Contact code inspectors and arrange for extensions to correct these violations on the house
Did I Put Together a Deal on All of These Properties?
Did I have any of these properties under contract at that time? Not a single one.
How many of those houses did I end up buying? All of them! This is just what I do when I am putting deals together.
I believe that providing these folks with exceptional customer service helped seal the deal each time. There is always “something extra” you can do for folks; something they need in addition to money for the property. It’s your job to find out what it is.
Putting deals together is never just about the real estate. These are real people that have real problems, and your ability to help them navigate those challenges is critical to your success. I’m pretty sure there will be some psychology involved in the process.