Our Zombie Deal (you know you want to read this)
Our Zombie Deal
or Sales 101 from the world’s worst salesman
This is a Halloween-themed post about a Zombie deal that came back from the dead. Insert creepy sounding “oooOOOOoooo” here. But it really is. At risk of jinxing a great deal, here is a real story about a real deal we recently put under contract.
I studied business in college but I am decidedly the worst salesman in the world. I am not allowed to show rental properties anymore because I will literally point out any minor flaw to the prospective tenant. My boss, I mean wife, will point out the really great qualities of the property like the park and playground right behind the house while I’m still trying to make sure they know a piece of grout is cracked behind the medicine cabinet.
I am allowed to make offers on houses; however, because people like me. I’m not joking. I’m really nice. In fact, it’s probably my biggest strength and my biggest weakness but it has served me well in this business. So while I couldn’t sell you on letting me pay you a dollar to buy a popsicle from me for a quarter, I can buy houses. I hope this is reassuring to those who don’t fancy themselves good salespeople.
I hate negotiating for cars and can barely look most salespeople in the eyes. Their “kindness” seems so disingenuous. So here is what I do when I need to negotiate with a seller. I talk to them. The sales gurus call this “building rapport.” I simply get to know them and slowly find out what their story is. I am genuinely interested in people. I treat them with respect regardless of their situation. I eventually get to the point of showing them a few options that I see for their property. Usually we can make a couple of different offers with different terms etc. and then we’ll show them other options like listing the property or renting it out. We’ll make an offer but we don’t apply any pressure. If they don’t make a decision while we are there, we thank them for their time and send them a text or give them a call a day later to thank them for allowing us to see their house and to wish them luck.
So back to our Zombie deal: we just didn’t have the best offer for this seller. She was a tired landlord and wanted to be done with this house. We visited for about an hour while we looked at the house. She was such a kind person and her kindness had been taken advantage of by the most recent tenant. She went so far as to buy him an umbrella so he wouldn’t park on the front lawn when it rained (to be closer to the front door). And he still wouldn’t pay the rent he owed her—or stop parking on the lawn. The ghouls and goblins had recently moved out so she was ready to sell. But…she received a higher offer from another investor who promised to make this an easy closing. I couldn’t blame her for taking the better offer and I was happy for her.
This house was so perfect for our model and it was in a neighborhood that we absolutely love owning rentals in. It had original wood floors and casement windows that were in good shape. It had central A/C that wasn’t very old. It just needed a little magic from my magical wife and her magic wand. Our offer was our highest allowable offer based on our numbers. She got an offer about four thousand higher than ours and we were disappointed but understood that she needed to get the best price she could. We texted her to congratulate her and offered to help her with her real estate ventures in the future as she had an interest in getting her realtor’s license. She thanked us and we left on really good terms.
Fast forward several weeks and I get a text from her. She tells me that her buyer fell through because the house was haunted (okay, I made that part up to keep the halloween theme going–but he did have personal things arise that didn’t allow him to complete the sale) and she wanted to know if we would still be interested in buying the house for the price we offered. I said we most certainly would and we sent her a contract via Docusign. One of the reasons she decided on us is because we found out that we had a mutual friend during our conversation. The other was that I’m such a nice guy. Just kidding. The moral of the story to me is to get to know the sellers and find out their issues and problems that they need to solve. Be kind and respectful and treat them the way you would want your mother to be treated (assuming you like your mother). If you have to use pressure to get the deal, you won’t sleep well at night. This is likely the seller’s largest investment and you don’t have to steal it to be successful.
I suggest taking what you learned in kindergarten and applying it to sales. Be nice. Treat others the way you want to be treated. Be honest. And don’t pick your nose.
We sometimes over-complicate things in this business. If you can solve the seller’s problem, at a price that can still be profitable to you, you can make a deal. The numbers matter but it really helps if they like you. A recent seller sold to us after another investor had looked at his house and made a similar offer as ours. He said that he sold to us because he liked us and because he felt like the other guy was “slimy”. Another friend sold to an investor who said “this contract is only good for six hours”. And while they got the deal, they get to live with their conscience and karma. This was her largest asset and a decision that would affect her retirement years. I believe there is plenty of money to be made while holding our heads up high and truly finding ways to help others out of difficult situations.
Don’t be afraid to talk to sellers. If they are motivated you will know it if you just take the time to talk to them and LISTEN. Try to talk about something other than the house to see if a conversation can begin naturally. Then gradually start to ask questions about the house itself. Don’t be in a rush. This is likely a huge decision for them.
I hope this Zombie deal has inspired you to leave each prospective seller with a positive feeling about who you are. You never know who will be brining you a future deal and your reputation matters. There are, unfortunately, plenty of people going through issues that create motivation to sell on any given day. You may have your own style of sales and negotiation but this is what has worked for the world’s worst salesman to get some pretty great deals.
Stay focused and stay kind. And always keep the main thing the main thing!