Qualifying Buyers #101

In the course of holding hundreds (thousands?) of Sunday open houses over the years, I can usually tell relatively quickly whether a given prospect is serious or not.

See if you can guess which of the comments below indicate serious Buyer interest:

A. “I LOVE this house.  Why is it so cheap?!?”
B.  “What quarry did the Italian marble in the fireplace surround come from?”
C.  “Why is the owner selling?”
D.  “What are the Comp’s for this house?”

Four Questions** ” Open House Edition

Here’s the answer key:

A. Unh-unh.  Unfortunately for agents who think they’ve just struck the mother lode, I’ve yet to have anyone who uttered this line (or something similar) turn out to be a real Buyer, at least at the time (vs. years later).

Such gushing comments invariably betray someone who is either:  a) not seriously shopping, and therefore unguarded about what they say; b) doesn’t know the market, and therefore isn’t ready to buy any time soon; or more likely, both “a.” and “b.”

P.S.:  even if they LOVE the home, their partner, sitting in the car in front, may not. Or, if the person is going through Sunday opens solo, their partner may have no idea they’re officially “looking.”

B. Nope. Prospective Buyers usually focus on the forest, not the trees ” and certainly not the leaves on the branches on the trees.

This type of question is much more indicative of a hobbyist or architecture buff, who enjoys seeing “For Sale” homes ” just doesn’t want to buy one.

C. Getting warmer. Certainly, lots of prospective Buyers are curious about the Seller’s motivation.

Especially if there’s any whiff of financial duress or time urgency (new job in another city), it can also be extremely relevant for any future purchase negotiations.

But listing agents  ” at least good ones ” know never to divulge the Seller’s motivation (at least not without written authorization), and therefore routinely deflect such questions (standard parries:  “Because the home doesn’t meet the Seller’s needs anymore”; or, “the Seller’s looking for something bigger/smaller/[fill in the blank.]”).

D. Definitely, maybe.  While it’s certainly possible that the person asking this question is an amateur housing buff (a first cousin to “b.”), it can also indicate someone who’s serious about buying a home, and is knowledgeable about how agents (as well as appraisers) price them.

Especially if the prospective Buyer is already working with an agent; is pre-qualified with a lender; and either doesn’t have a home to sell, or doesn’t need to sell in order to buy, the odds of such a prospect being “for real” go up significantly.

Open House Traffic: the More the Merrier

So, given all the different kinds of non-serious Buyers coming through Sunday opens, does that mean Realtors are unhappy when such folks show up?

On the contrary.

As I tell my listing clients, the real Buyers going through open houses don’t know who the casual lookers are.

They just know that there’s a house full of people, and that if they like the home, they’d better hurry to make an offer before someone else does.

**Bonus points if you caught the Passover reference.  Per colleague Morrie Hartman, the truer equivalent would be, “Why is this open house visitor different from all other open house visitors?”

See also, “Serious Buyers:  Top 10 Signs”; “Unserious Buyers: Top 10 Signs”; “Is the Buyer Serious? Here’s One Clue“; and “Qualifying Sunday Open House Traffic.”

About the author

Ross Kaplan has 19+ years experience selling real estate all over the Twin Cities. He is also a 12-time consecutive "Super Real Estate Agent," as determined by Mpls. - St. Paul Magazine and Twin Cities Business Magazine. Prior to becoming a Realtor, Ross was an attorney (corporate law), CPA, and entrepreneur. He holds an economics degree from Stanford.

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