The Importance of Questions in Today's Real Estate Market

In this article, Dirk Zeller breaks down the importance of using strategic questions to move a lead down the buyer's journey in today's market.

Let's look at today's real estate context:

Inflation's going down, CPI number is going down, and we're seeing good moves downward. And sure, fed rate is likely gonna push some of it up, but remember - mortgage rate is not tied to fed rate.

Mortgage rate is tied to the Yield on 10 year Treasury Bond, and that number moving downwards.

You probably have a lot of people sitting on the fence right now. It's not because you're doing anything wrong, it's because there's a fear about what's going to happen.

Your job is to show your buyer leads the pattern: 

"We had the upward trend, we're having a downward trend right now, and if we can find you a good property, we can take action in the near future, and you're going to likely time this cycle down, and you'll be in the low 6% rate - and you can sit tight there 12, 18 months until the rates cycle down to a lower level, or you can take it now."

And to your seller leads, you need to say:

"Hey, we need to get ready. We need to get your house in ready-sell conditions. We gotta do all the things that need to be done over the next handful of weeks. We might need to wait at that point because rates will likely cycle up again in 4-5 weeks from now, then they'll go down, and that's when we can get your home on the market."

Because the pattern's gonna continue. Rates will cycle up and down till spring market.

You have to help people get more comfortable with taking action. 

And here's the thing: More time generally does not get them more comfortable.

What makes them more comfortable is being reminded of what triggered them to go on your website in the first place, and to want to get more information about a particular property.

There's something they want to accomplish, or something their home is currently missing.

What's causing people to take action?

It could be a change or transition. And that's when we look at the 4Ps.

• People: they might be adding members to the family, subtracting members from the family, getting a divorce, etc.
• Profession: they could be changing profession, they might've gotten fired due todownsizing, they might've gotten a big bonus that's sitting still right now, etc.
• Places: they might be wanting to get a vacation home, they might be changing school districts, they might be wanting to move to a safer neighborhood, etc.
  
• Priorities: they might be working from home right now, they might want to be closer to family, they might be entering retirement and want to change their lifestyle, they might be snowbirding, etc. 

It could be awareness. Awareness of change, or opportunity, or loss.

We have people where they realize they're financially overextended, or there's a physical change, or there's a void where they are and where they want to be.

Our goal is to understand this reason or this need for change.

And if we get marginal responses like: our home is fine but we'd like one with an extra bedroom - those aren't motivation.

You've gotta probe deeper. You have to find out if it's more than "interest".

Because if it's just interest, your probabilities of finding them something perfect enough that would get them to take action are very small.

Defining Their Why

Words like "fine", or "interest", or "kinda" - that's your trigger to probe deeper. 

"As an individual  who's been married for 30 years I know that when my wife says 'this is fine' or 'I'm fine', I know things are certainly not fine." jokes Dirk

Something people will say often is: Dirk, I want a really good deal.

But what does that mean to them? Dirk has no idea, and most of the time, they don't either. This is the time when you want to ask:

"Hey, in 33 of helping clients such as yourself, I've come to the conclusion that "good deal" means different things to different people. Can  you let me know what a good deal means to you, specifically?"

Then you let them speak, and you let them go deep and granular on percentages, details, etc. Most of the time you'll be thinking that there's no way all of that's available in the market, but it doesn't matter. Your job is to listen, and take notes.

If they're giving you some of the standard phrases we're hearing, like:

• I'm waiting for rates to go down
• I'm waiting for prices to go down

You can follow up with: "how much down are you hoping them to go? What are you basing that analysis on?"

You've gotta help them define their answer. 

Another question to get specific is: "how much savings per month do you need to get?"

And of course, you'll get some more low-quality answers like: well, as much as I can get!

You want to push back on those.

"Certainly, we want you to get as much as possible. But ultimately we want to define what that zone is for you. So how much down do prices need to go before you feel comfortable to go to the market?"

Then, you can follow up with a softer, more emotionally-driven question:

"What do you and your family need that your present home doesn't possess?"

This is where you'll get a lot of answers. More space, a garden, a fireplace, etc. And you need to be writing everything down and making a compiled list.

And then comes the money question:

"Are there options in your current home to be able to _________?"

(i.e. add more space, have that basement you want, have that single-level living)

Whatever it is that's causing them to think their home is not for them, you need to understand if that can be changed. Sometimes there's an answer to this, sometimes there isn't.

And then you probe.

"Well, how much do you think that would cause you?"

"How difficult would it be to add an extra floor?"

"How much trouble would it be to live in your house during that transition?"

"How important is this workshop in your garage to you?"

We need to fully understand why they want to buy, and what they're looking to buy.

Because it's a lot easier to sell people what they want to buy than what you have to sell them.

In the old market, we didn't have to figure out why they were buying, because their motivation was so off the charts due to the low rates.

In today's marketplace, where motivation is not as high, we gotta inject some urgency in these conversations and ultimately persuade them to take action into what we know they want.

The better you understand their why, the better you'll be able to persuade them.

Using Pressure-Relief Statements

Sometimes they'll feel a little too much pressure after answering so many questions, so you want to use these Pressure-relief statements to reassure them.

If you're good at questioning, even if you're conversational and not aggressive, you're gonna get some people that pull back or feel uncomfortable.

And you have to learn how to dial the temperature of the conversation down while at the same time keep it going.

Here are some options for doing so:

"Hey, I totally understand your hesitation. I know you've had lots of sales experiences, and most of them were not very favorable. I want you to know that I'm not trying to sell you anything. We reach out to people who are using our site to really help them maximize their service experience."

"Hey, I'm just trying to be of service. I know my question might've caught you off guard, but I'm trying to customize your search experience so I can send you some off-market opportunities that fit what you want."

"Don't worry, I'm just trying to be specific here so we can customize your search criteria. I have a lot of data about the market right now and I'm sure I can send some things your way, but I want to be as specific as possible to avoid sending you stuff that doesn't fit your needs."

And you can always refer to other, more playful, more conversational questions to dial the temperature down and continue building rapport, such as:

"So Steve, you want space for your music studio in your new home. What style of music do you compose?"

"What's gotten you thinking of changing school districts? I had a friend who recently did the switch and their kids are happier than ever."

Final Thoughts

So, there you have it – the lowdown on why asking deep questions is your secret weapon in today's real estate game. We hope Dirk's insights have shown you that today, your leads' moves are less related to market opportunities, and much more related life changes and aspirations.

In this rollercoaster of a market, where rates dance and motivations sway, being the agent armed with killer questions sets you apart. You're not just slinging houses; you're decoding dreams and needs. So go on, get nosy – ask the "whys," uncover the "hows," and watch your clients' journeys unfold with you as their guide. Happy questioning!