51. HOME SERIES 7 OF 8 -HOME SELLING AND REAL ESTATE PROFESSIONALS

Home Series 7 of 8

Adrian   00:02

Hello future millionaires and welcome back to the get rich slow podcast. We are your hosts, Adrian Shermer, Rob Delavan and Lance Johnson. Good morning, gentlemen.

Rob Delavan   00:11

Good morning, Adrian and good morning Mr. Brilliant at the basics, Mr. Johnson.

Lance Johnson   00:17

Good morning, y’all, good to see you guys.

Adrian   00:21

And welcome back to part seven in an eight part series, home Selling and real estate professionals is the title of this one.

Rob Delavan   00:31

Yes, episode seven of an eight part series again and this is a fun one. It talks specifically about my profession.

Adrian   00:40

And before we dive into that, I would like to talk about its kind of dressing we call it the success story, right? We often like to put a little bit of joy at the beginning of our podcasts. This one’s kind of like a roundabout, it takes a while to get to the success.

Rob Delavan   00:57

Yeah, this was an interesting one. I talked about it before with our producing side and she said, Ashley, our producer, she said, okay, well, this is what I’m going to call it don’t burn bridges and do your homework. Yeah, so an interesting story, it actually involves some clients that Adrian and I had worked with in the last few years and what ended up happening is they were doing their lending with Adrian and pre-approved going through starting the process and it was down to working with the Delavan Realty Team, my own company and my team and these particular buyers we’re getting their down payment from a family member, I think it was an aunt or uncle or something like that who was very much pressuring them to use their realtor and hey, you’re getting the down payment from him, so,  ultimately, we spent a little bit of time with them talked about our processes and I assume they talked to that other person, I don’t know at what length or level, but they decided to go with that other person that was, their aunt, her uncle’s, their down payment, family members, favorite person. So, they ended up going through a transaction and successfully bought a house and Adrian again, I believe you did the financing and they were able to get through a transaction and so forth. Well, I didn’t hear anything from them. We just okay, hey, great, you know, no problem, we get that, you know, you have a family connection; we wish you the best of luck. Well, they ended up buying the house and we didn’t hear from him for, you know, a few years, I don’t know, two plus years and long story short, a member of my team Rachel, who is the person that they had been, initially talking to, hears from them and they’re selling the house that they had bought back then with that previous broker and buying a new house, that house wasn’t meeting their needs anymore and so forth. They’re doing, kind of an upgrade, so to speak. So, of course, the first question she asked is, well, why are you calling me? Shouldn’t you be using the person that you had incredible success with because they did a great job. So, this is the fun part. She’s they said, oh, well, they were a little sheepish about it and they said, well, we made a big mistake and we went with this other person and there was some specific feedback that in the conversation, you had Adrian and maybe you can share that their experience when they bought that house why they said they would never ever in a million years use that person again.

Adrian   03:53

Yeah, I was sad because they actually had used Rachel’s resources too, they had had her bring them out on open houses and then there was just a super minor schedule conflict and again, they had this other person and they thought, you know, they were first time homebuyers, how different could it be very different as it turns out, because the most egregious thing that this guy did, he wasn’t great at negotiating and I could pick this apart in my own personal opinion. But when he told his clients, I need this commission cheque because I’m in the middle of a divorce. I was bewildered, I couldn’t believe that a professional would actually tell someone they need the commission check, let alone for something like that. You know it’s so personal. It’s so aggressive and he wanted stuff to close and he really demonstrated to them to like, Hey, I’m not negotiating for you. I’m gonna go shooting for me. I’m negotiating for my pay cheque. I’m playing a short term game here and you know what, these people are going to come back to you with that kind of attitude and it really stung me because they did come back to re because she took the whole thing with Grace she didn’t blow up on them for wasting her time and they really resulted in two transactions for her, she got to take both sides to sell and buy.

Rob Delavan   05:14

And so the moral of the story, don’t burn bridges, number one and then number two, when you’re working with professionals and this isn’t just the realtor world, there’s pretty low barrier to entry in our world, you have to take 150 hour course and pass a test. But do your homework with the people that you’re working with? I mean, this is like pulling from personal experience shameless plug for you two gentlemen, but I don’t work with people that are part timers in other industries, I certainly don’t work with a financial advisor who just started yesterday, or does it on the side? Same thing on the lending side, I mean in my personal opinion, again, I don’t know how you verify this legally so to speak, but I mean, like, you work, you want to do your homework and work with people that truly are there to serve you and have a huge reference list and past successes to backup yet their strategy moving forward. So, long story long, don’t burn bridges, do your homework only work with people, I don’t know. I about fell off my chair when I heard that statement of a realtor saying [Mixed Voices 06:37]

Adrian   06:47

And just hear the regret my client’s voices. I mean, it was just such a sad story. But again, lessons learned, they certainly learned their lesson the hard way on their first time purchase and they won’t make the same mistake again. Pulling out of that fun one, we’ve got our website ROI-fa.com/events is a great place to find out what is happening in our world. We do stuff all the time, jump on there to get involved in some fun stuff and to get links to our individual sites if you want to contact us and we’ll find out more about what we do. In this particular episode, we are going to be discussing the home selling and real estate professionals based on stats received from once again the National Association of REALTORS from July 2020 through June 2021. We use this broker data all the time because it’s highly accurate. The information provides an understanding from the consumer level of the trends that are transpiring.

Rob Delavan   07:48

Excellent and part seven of eight and for the full article as the viewers that are looking at our PowerPoint here you can see it’s from page 9 of that NAR article titled home selling and real estate professionals and everything is in our works cited below and show notes.

Adrian   08:14

All right, Rob, based on the statistics from this NAR article 68% of sellers found their agent through a referral from a friend, neighbor or relative or they use an agent that they’d worked with before to buy or sell a home, how important are personal referrals to your business?

Rob Delavan   08:34

Well, that’s an easy one, personal referrals and across the board, regardless of where they came from but relational referrals are the foundation of my business. I do not do basically any advertising, to try to get business any other way other than just through the myriad of personal relationships I have with buyers and sellers themselves and more importantly or well, just as important is the business relationships of all of the people that I do business with and that I end up partnering with to share those referrals across the board. So, they’re the ultimate importance. We are a referral company in that is the source of our business. There’s lots of different ways you can do it. I’m not saying that that’s right or wrong. I’m just saying that that’s how I’ve done business as long as I’ve been in real estate for the last, I don’t know, 16-17 years and the reason for that and I think that’s really the gist of this question. The reason for that is if I have a relationship with Lance and we’re doing business with a, say a common client, the accountability for taking the utmost care of that client, whether he reached out to me or I referred it to him, same thing with you, Adrian is the strength of our relationship dictates basically the ultimate accountability is actually not just to that client, but also to Lance checking in, hey, how’s it going? What’s going on with that client? Did you do, we’ll actually, be able to converse through, have you done these different things and over time, we figured out how each other work and the best way to serve the client that we know how. So, it’s like playing high school varsity sports and taking it to the pro-level, it’s not the same game, if you can bring all of these professionals to the table. And, I learned this in a lot of different ways and I would say the culmination we’re always growing, but the combination of that is right now is, the fact that the three of us do this podcast, high levels of trust, high levels of expertise and we go out there and we go to war for our clients for each other. So, I’m sure you guys have something to add on that but…

Adrian   11:14

I’ll stretch your sports analogy even further. I mean, you couldn’t pluck some of the best players from every team, you couldn’t take players and randomly chuck them together and expect the same results that you get if you have a group that practice together. So, there’s a honing that happens to the more every time we have a transaction, we get a little bit better at working not just on the job that we do, but working with each other and reading that, in sales, you’ll hear this thing a lot, the triangle of trust, you get that third person in there and a triangles the most rigid, solid shape and it’s billed as a very important thing. But it really is for a reason, because it’s, again, that accountability, like you mentioned you’re not just doing the job for the client anymore. It’s not a release into the hands, it’s a real, there’s a lot of trust that has to be established and it gets established as you repeatedly make that success for the clients together.

Lance Johnson   12:32

Are you gonna move to the next slide?

Rob Delavan   12:35

That would be helpful, okay, well, let’s do another pause here, Avery and then jump right back into it.

Lance Johnson   12:44

Rob, Adrian, from a referral standpoint, how valuable is the referral relationship we all have? I think you were touching upon that…

Adrian   12:53

Yeah, mission critical. I got to say too, there’s this extra layer, I was thinking about this question, we go over this stuff before we shoot and this one kind of struck me because especially with the two of you guys, I think that we’ve developed the kind of professional trust that I can get negative feedback from you guys and I can give negative feedback and we’re not saying, when you just get to know someone and you have this professional relationship and you’re passing referrals like that, it’s easy to get into a mode I’ve had people I’ve worked with where it’s like, we could have 10 successes in a row, we have one failure, you’re a failure, I hate that this happened and I’m just gonna use somebody else because that’s the method I’m thinking is going to stop failures from happening in the future and you’ll watch people kind of burn their way across an industry with, I’ve seen realtors that use 10 different lenders in a row, I’ve seen the opposite direction as well and the real power comes from being able to give the constructive criticism and to go, hey, man, I think you can do this better for the client without feeling like a personal attack and being able to have the power to take that information in and go, okay, let me change my business a little bit, because you’re the person I work with the most and I want to hone myself, not just for the best individual client experience, but holistically, how can we all work together towards this client goal and I think it was that last episode, you guys had this great success story with 12 different professionals all working together. A lot of that was because those professionals could communicate behind the scenes and from the clients perspective, they’re not having to re-explain everything and that’s some of the beauty of working with someone like you Lance, your team provides a packet of information to me and that seems really convenient to me, but it’s super convenient for the customer. They had to send all that stuff to you or maybe they didn’t even have to because they already have their accounts with you. So, I can just say, hey, give me their investment accounts for the last two months and boom, it’s in my hands. The client often goes how much is in there I don’t even you know like there’s and that’s such a power sign when the client is so not worried about where their money is that they can just take their hands off the wheel and go I’ll just wait till you know our meeting every year to see where things updated. I get to focus on my own life, my kids my job, my passions and not have to check the account balances every week and panic. So, I think it’s critically important because we can be each other’s coaches in a way.

Lance Johnson   12:54

Yeah and I think we talk with our BNI group and my message is always about processes and we all win if the clients win. You start with that in mind is how can we have an impact a positive impact on our clients, everything has to be for the benefit of the client, it’s almost without being said, but it needs to be said sometimes, like you talked about that success story where it was about, it was about the real estate agent, not about the client. That’s not somebody, I want to have a referral scenario when they’re putting their own scenarios ahead of the client and then what works, let’s say you have 10, 5 closes in a month, that’s a great month and then all of a sudden, now, you grow in your abilities and you have staff and then all sudden, now it’s 7 to 10. That’s double, that’s 50% increase over and you think what works at 5 closes, doesn’t necessarily work at7 and 10. If you don’t have the right support staff and so as you’re scaling and your business is growing, your processes have to get better and so that the client wins, right or more clients win, right? And so referrals important, you have to help people through processes and that’s why I often all my members, read the book, the goal and if you can get that processes going in that interaction, that communication, we’re always striving to be better at communication, it’s never enough and so with that, if you can improve that the relationships become better, the communication becomes easier. They don’t have to necessarily communicate directly to us, they can do it through our staff and that makes it really valuable to the client.

Rob Delavan   17:30

The only thing that I’ll input into this question is, when we do refer, our names are on the line, our relationships are on the line, that can be a positive, in the sense that we know they’re gonna get taken care of, because we trust each other’s processes, because we’ve helped Hone each other’s processes, through systems and so forth, like you’re discussing, Lance, the flip side of that is something goes sideways. You know I mean, it’s not just my reputation, it’s my referral partners reputation. So, it cuts both ways and the stakes, in essence in a referral situation are actually higher, not lower. Yes, a high amount of trust from the get goes so you can start off instead of from ground floor, you can start multiple layers up because of the shared mutual trust. But man, if it goes negative, it goes negative. So, stakes are high, not-withstanding legal requirements and all of the other things that we have to do in our respective professions. So, I love this and you guys know how much I appreciate, how much you care you take with all of our mutual clients.

Adrian   18:39

Yeah, that’s a cool point too because if you carry through a failure like that and you let someone show you how they respond to it because every, every business has these these points of, you didn’t do what you wanted to do for a client or something came up that, you know, causes a pain point. It’s how does that person react to that and again, growing that relationship as part of that.

Rob Delavan   19:11

Okay, so the last question I have actually is for you, Lance, in your opinion, why is it vital for your clients to work with real estate professionals?

Lance Johnson   19:22

Great question so, right from day one, I’ve always been a proponent for real estate because of my knowledge and taxes and some of the advantages of rentals and vacation rentals and commercial business owner. So, I don’t want all my clients to have just stocks and bonds. Yeah, I probably would make more money but I think the world works in imbalance. Real estate is a real commodity that you can touch and feel where something you can’t really touch and feel a stock or a bond and exists or a commodity when you can see gold, but not too many people have gold bullion in a safe in their house, right? So, if you believe in real estate, which I do and the benefits tax wise and so forth and so many making your wealth, then you got to go out there and it’s buyer [Inaudible 20:35] and so there are things and people will go to me and they’ll be like, I’ve been looking for houses and I’m like, oh, how many of you see and they were like, well, I looked on Zillow, looking on Zillow is not looking at houses, the point of view of all the good stuff, seeing the bad stuff and also, it’s hard to determine the good bones. So, all the houses now that come on the market, they’re gone within a day. So, now the question is, the next layer is, are there houses out there that have great bones and in the future and rising interest rates, you’re gonna get a good deal when you can remodel that house and have a special flip like, there’s all the shows that are about flipping and remodeling houses and one thing I learned about all that is you got to bring it all down to the studs and redo it, because the codes and all those things but working with a professional really goes out and helps you weigh the options of what could be. And, I often talk about the dream over here and how do you make dreams a reality and you know it, the last 30 years real estate wise is going to be way different than next 30 years and you’re going to work twice as hard and make less sales, possibly, but the values will be up and they’re going to really need those professionals to help kind of bridge the gap between negotiation, I think that’s some of the best is you take a little bit of emotion out of it and really get down to a final point quicker and then help educate your clients about what you’re going into and I think that’s crucial.

Rob Delavan   22:32

And that works not just on the realtor side, real estate agent broker if you will, depending on what state you’re in, but also lending, where we’ve probably had the most problems, in my experience over the last 16, 17, 18 years that I’ve been working in real estate. The most difficult hurdle has always been getting unique financial situations of individuals to fit into the box that lending typical [Inaudible 23:06] lending standards require and that’s where you have to bring a breadth of knowledge of, hey, this is how it works and you have to have a team and that’s the piece where that real estate professional, the lender, the lending professionals is also huge and that relationship and this isn’t, you know a Adrian and Rob show. In that sense, there’s an incredible amount of amazing lenders, real estate brokers, frankly, financial advisors out there, in theory, we’re out of the Portland metro area, but this is a national show, I guess it’s a universal show, right? anybody anywhere can hear it, the concepts don’t change. You have to have what Lance said somebody who’s educated who was committed to educating you at the level that you need to have to be able to know what your options are and then try to make the best choices you have based on in a given situation.

Lance Johnson   24:09

And selfishly, sometimes I think, if there was a little bit more planning ahead, for those clients, they, sometimes it’s the right time to stretch yourself and then sometimes it’s the right time to consolidate things. So, when the market was going up, I was always like, if your goal is to retire with no real estate, that that sometimes is one person’s desire for safety and so when you get those wins, you need to take those wins off the table and pay down debt and I think a little bit of planning goes a long way when all of us wrong and so that’s a selfish interest that clients should do planning, but I think the experience becomes a little bit better when we can plan out should I go for 550 home, should I go for a 650 home or a 750 home and my question is, are you starting at 750? Are you starting at 650 and then now you have to settle in on 750 because the markets hot? And those are all discussions that helps clients go through, there’s nothing worse than it’s kind of like never bride and bridesmaids always and you go up to bat for a house and if you’re not number one and you’re 2 through 25, it doesn’t matter whether you’re 2, 3, 4, 5, you’re just not number one.

Rob Delavan   25:43

Almost first loser

Lance Johnson   25:48

It doesn’t matter, that experience doesn’t become a positive thing and I think, a little bit of planning on what you can afford and go for, interest rates still in the scheme of things are low. I mean, I know it’s five and we haven’t seen him for a while but it’s still a good rate. I mean, it’s as good as 2.5 but 2.5 was unique as a pandemic, when’s the last time you guys lived through a pandemic?

Adrian   26:14

First for me, personally…

Rob Delavan   26:17

First for all of us I believe so.

Adrian   26:23

Well, that’s a wrap for our home selling and real estate professional’s episodes. Please stay tuned for our last episode in the eight part series coming up next. In the next episode, we will be learning about for sale by owner sellers. Thanks so much for your time today, guys and thank you to our audience. As Rob said, it could be global, it could be interplanetary, I liked that idea, maybe there’s someone out there listening on the other side of this galaxy.

Lance Johnson   26:51

You think the space station people are listening?

Adrian   26:53

I think so, they’re looking down going, oh, maybe I should invest in some of this thing.

Rob Delavan   26:58

They need a little get rich slow, thank you, gentlemen, always a pleasure.