Posted by JK on June 10, 2006 at 24:30:47:
There’s a ring of truth in your post. I like it a lot, and will use it.
establishing rapport - Posted by Lin (NC)
Posted by Lin (NC) on June 09, 2006 at 09:16:33:
I met with a seller yesterday who has two weeks to get out of the park. She’s a heavy smoker, the home has a cracked tub, some soft spots here and there, all plumbing needs to be re-done, needs Cool Sealed, and the park is requiring the exterior to be painted within the next year. It’s a 1988 2/2. I explained all that to her and said that given all the money I’d have to spend on those repairs I could only afford to pay her $2000. She was asking $5000, down from $6500 last week. The PM had told her she’d be lucky to get $3000.
Her response to my offer was, “I’d rather give this trailer away than sell it to YOU for $2000.” Ouch. Obviously I failed to establish enough rapport to support my low offer. But I’m very curious to see if she calls me anyway a week from now when all her other buyers fall through.
Re: establishing rapport - Posted by Ryan (NC)
Posted by Ryan (NC) on June 09, 2006 at 22:12:53:
Great Rapport is hard to build with a seller and near impossible to strike right off the bat or recover once it’s lost. I tend to take Lonnie’s approach of looking for something of interest that I can talk to the seller about that they are proud of while I’m looking for faults in the trailer. Once I feel the comfort level starting to relax I will start probing for information on why they are selling.
IF they are truly motivated and you can solve their problem they normally see you as the savior that they have been looking for. I’ve had sellers give me hugs and thank me profusely for helping them. On the other hand I’ve had poor results when I try to speed the process up, get in a hurry, talk price to soon, or fail to create a win/win. When things start going bad they tend to fall apart very quickly, Ya just gota take your time!
Even when we’ve done our job almost perfectly, things happen! I’ve been told NO more times than I will ever admit and I?ve walked away more times than I’ve gotten the paperwork signed. I too have been told “I’d rather give this @&%#!^& thing away than sell it to for $$$.” No skin off my back, they’ve still gota sell and I don’t have to buy… It’s that simple! (Although it did kinda hurt for a fraction of a second when one guy tossed my card back in my face.)
Don’t worry about it; there is another deal with your name on it right around the corner!
As a side note: Our best deals have come about when I show up to look at a home dressed in work cloths covered in paint looking like a complete bum. Maybe they just feel sorry for me?
Best wishes,
Ryan Needler
Re: establishing rapport - Posted by Anne_ND
Posted by Anne_ND on June 09, 2006 at 15:42:12:
Hi Lin,
I agree with the other comments- if (more likely, when) she calls you back, don’t give her $2000, tell her the price has dropped, or just tell her you don’t want the house after all. It’s 18 years old and it’s only got two BR, aside from all the other issues. I’d be aiming for $1000.
In these situations I tell the seller I have to buy wholesale, and she’s looking for a retail buyer, but to keep my card in case her situation changes.
I know you were very mellow with her, this is about HER issues, not any failure on your part to establish rapport.
Next.
Anne
Re: establishing rapport - Posted by Sailor
Posted by Sailor on June 09, 2006 at 14:01:42:
Your offer sounds more than generous to me, Lin. It is frustrating when you know your deal is the best someone is going to be able to get. Next time your efforts are thwarted, try chocolate–for you, not the seller. If this one calls back, I’d lower the offer to $1800. It may not be business-like, but it is VERY satisfying. Remember, kid, there’s always another trailer!
Tye
Re: establishing rapport (long) - Posted by Steve Contois
Posted by Steve Contois on June 09, 2006 at 13:05:27:
Negoitiating is uncomfortable sometimes isn’t it Lin? Most investors do not like when a seller makes us feel like we are trying to screw them, me included. Especially when you make a more than generous offer like you did. Here is an effective negotiating technique I learned from working with Karl Kleiner. This approach is especially effective when you can’t find anything wrong with the home. “Mr. or Mrs Seller, I used to buy homes from private individuals all the time. Then I got turned on to buying bank repos. The bank repos are such fine deals that I RARELY ever even look at a privately owned home anymore. I made the exception for you becasue the park manager asked me to try to help you out. I typically go in with other investors and we buy 10-12 repos at a time. The added buying power allows me to buy homes for $.50 on the dollar. The homes are 99 and newer, 3/2 baths, vinyl shingle with all the new amenities you would expect from a newer home. The most I ever pay is $5k cash for these homes. Your home hear is nice but it needs a lot more work than I am equipped to do myself. So, I’ll be forced to hire a contractor and pay lot rent, etc. Plus, the home is twelve years older than what I typically buy and its only a 2 bedroom. My market is going to be limited to couples w/o children. Geez, this home has potential, but it just doesn’t make sense for me to spend $5k on this home when I can get one so much larger and newer from the bank for the same price. The most I could give you would be $1k cash today. I know its not what you wanted but it will give you a chance to have some moving money and you can get on with your life. I’ll take care of the details. All you have to do is sign the title over to me.”
If they attack you personally or seem put off, the next step works well. I’ll say, “I can understand why you need 5k. Someone that is going to live here MAY give you that if you don’t mind waiting it out a bit. Here is what I would do if I were you. I would spend $150 on a classified ad and put a big sign in the front window. Then, fix all this stuff up and give the home a good cleaning. Then have an open house all weekend from 9am - 6pm and you might get lucky. Just make sure you screen the potential customers, the park can be real selective on who they will rent the lot to. I’ve had a ton of applications get rejected lately.” If it doesn’t work out, I’ll be your safety net. Call me and I will bring you the cash right away. Here is my card, good luck!
The thing I like about Karl’s technique is that it puts you in a postition of helping them. Your not viewed as an adversery trieing to squeeze every last $$$ out of them. Your response will sting them a little bit at first, but the tension typically eases once you start giving them advice on how to sell the home. The last thing the seller wants to do is give up there weekend showing the home and cleaning. The seller will often drop the price again before you leave, or, 9x out of ten, your phone rings in a few weeks and they are thanking you for bailing them out. I look at buying a home as a 4 or 5 step process. Which I would have known this technique in the beginning. I overpaid for several homes and it came back to bight me in the a$$. I’m out-
Steve
Felt that before - Posted by Dr. B. (OH)
Posted by Dr. B. (OH) on June 09, 2006 at 11:35:43:
I’ve had those stinging remarks before or heard them said to others about me. In Fact, on occasion they do have to give it away (to the park). Then I buy it for from the park for as little as 1/4 what I would have paid the owner outright.
In a recent post I attempted to pay an owner’s back lot rent, back taxes, and $200 to her to walk so she’d have no eviction on her record. She has not called me, the sheriff is coming in the next 6 days. I’ll wait till the PM offers me the home. I’ll pay the back lot rent, taxes and $200 to the PM for her trouble.
Many of these folks are not realistic about the situation they are in. Lonnie talks about this in DOW.
Happy Trail(er)s,
Steve
Re: establishing rapport - Posted by JeffB (MI)
Posted by JeffB (MI) on June 09, 2006 at 10:11:39:
I’ve had this happen to me as well (albeit without the stinging personal remark). What I tell people is “your asking price is reasonable, and I’d be willing to pay you that amount if you will go ahead and make all the repairs (then begin making a long verbal list).”
Of course, I’m bluffing because I wouldn’t pay that amount if they DID make the repairs, but we all know that most people won’t bite anyhow.
By the way, $2000 seems very generous given the condition of the trailer as you described it. I normally get this type of trailer for free or maybe a couple hundred bucks, but in my market it would only sell for maybe $8-9k in very good condition. What would it retail for in your market?
Re: establishing rapport - Posted by Steve Crawford
Posted by Steve Crawford on June 09, 2006 at 22:42:57:
I have had a couple of people throw my card back in my face. The one time it did hurt, just a wee little bit for a very small fraction of a second, was when he tore it in half first and threw it at me.
I couldn’t help myself, but I laughed. For some stupid reason, I thought it funny. I genuinely smiled at him and wished him the best of luck. I could tell he was madder than hell.
Re: establishing rapport (long) - Posted by JeffB (MI)
Posted by JeffB (MI) on June 12, 2006 at 14:07:18:
Awesome! Thanks for taking the time to type this out for us. Going to look at a 1999 3/2 tonight, and I’m going to give this a try.
Re: establishing rapport (long) - Posted by Glen (Oh)
Posted by Glen (Oh) on June 10, 2006 at 18:31:31:
Karl’s ‘Instilling Despair’ technique is great!
Glen(OH)