More of your clients these days might be feeling like Dan and Lorena Schoenfeld of Fort Lauderdale, Fla. Last year, the couple found a three-bedroom condo with all the features they wanted—and the motivated seller was willing to accept $100,000 less than comparable units were selling for in the luxury building. And yet they were reluctant to buy.
“We were worried about the economic state of the U.S. We didn’t think the value of the condo would hold up into the future,” admits Dan Schoenfeld, 35, who works for the investment arm of a national foundation.
“People have selective memories about the last housing bubble,” Schoenfeld says. “They don’t think it can happen again.” But for those personally affected—and the Schoenfelds count themselves in those ranks—the unease can be acute. When the housing market tanked in 2008, the Schoenfelds’ condo lost a third of its value. In 2010, they were able to rent out the unit, and they too became renters, moving to an area where they hoped to buy again someday. But they remained deeply conflicted about making a purchase.
Their agent, Samantha DeBianchi, responded with support, solid facts, and patience. Eventually, they bought the $535,000 condo, realizing that the record-low mortgage rates available at the time wouldn’t last.
A majority of both buyers and sellers say now is a good time to be in the market, according to the National Association of REALTORS®’ quarterly HOME Survey. However, buyer anxiety ticked up in 2016. Whether because of a negative past experiences or fears about the future, fewer buyers in the fourth quarter said it was a “good time to buy”—70 percent, compared with 75 percent in the first quarter of 2016. The fourth quarter survey was conducted after the Nov. 8 election, but the data reflects a steady decline over the year rather than a reaction to the election results. And although seller confidence increased steadily over 2016, more than a third—38 percent in the fourth quarter—said it wasn’t a good time to sell. So how do you set jittery clients at ease?
The ‘Antidote to Anxiety’
Mental health experts say trying to downplay clients’ feelings or convince them that they’re being irrational is the wrong approach. Instead, try empathy. Listen to their fears. Understand what they’re comfortable with and what they’re not.
“The antidote to anxiety is control,” says Kit Yarrow, a San Francisco–based consumer psychologist and author of Decoding the New Consumer Mind. That comes from knowledge, transparency, and actually ceding control; you can achieve all three with clear communication.
Start with knowledge. What’s standard operating procedure for you may baffle or upset your clients. For example, many consumers instinctively find the fine print in mortgage and sales documents manipulative, Yarrow says. Plain-language explanations can reduce their skepticism. There’s comfort for you, too, in knowing your clients understand what they’re agreeing to.
Yarrow advises communicating visually as much as possible, using graphs and charts to present housing data or videos to highlight a home’s attributes. “The internet has changed our brains,” Yarrow says. “We process information faster and at a more superficial and visual level.” Clients trust information when they can see the story it’s telling them.
Share Your Expertise and Your Story
The worst thing you can do is talk reluctant buyers or sellers into something they’re not ready for. That’ll surely come back to bite you. But a little well-placed reassurance that you understand their concerns, not just as a professional but as a consumer, can go a long way. Firsthand accounts of why you bought, sold, or rented out a house can demonstrate your knowledge of the local market and help steer clients away from poor buying or selling decisions, says DeBianchi, broker-owner of DeBianchi Real Estate in Fort Lauderdale. She relays to clients her experience buying a house for $550,000 in 2014, selling it for $805,000 last year, and then buying down for $485,000 in an up-and-coming neighborhood while saving the rest of her proceeds. “My clients may not choose to do exactly what I did, but when I tell them [my story], they can see I know what I’m doing,” DeBianchi says.
Clients’ natural reaction to your advice may be resistance. Don’t take offense. Again, no one wants to be manipulated or “sold” on something.
Brad Allen, CRS, broker-in-charge at The ART of Real Estate in Columbia, S.C., talks with many relocating clients from areas of the country that were devastated by the housing crash. “You have to let people absorb what’s going on around them and come to terms with it,” he says. “I’m just real with them, and I’m not afraid to talk about it if it’s not their time to move. Our motto is: Lay out all the options and let the client choose.”
Be Their Partner, Not Their Leader
Ay, there’s the rub. You have goals, after all, and it can be tempting to swing into sales mode.
But ceding control to your clients means looking at your role in a different light, says Alexis Bolin, CRS, SFR, broker-associate at ERA Legacy Realty in Pensacola, Fla. She suggests thinking of yourself as a consultant instead of a salesperson.
“I believe my job is to ask questions of my clients more than to give answers they didn’t ask for. I don’t tell them what I think they should do,” Bolin says. Thoroughly explaining each option available to your clients will help them feel like they’re not making a choice blindly.
The key is to be a “quiet authority,” Yarrow says. Stress your knowledge and ability in a gentle way, which lets your customers know that even though they have the power in the transaction, you’re their backup. “[Consumers] want to have all this control, but they are secretly relieved to know someone can take the reins if they can’t handle it,” she says. In the end, “they don’t always want as much power as they think they do.”