Managing client expectations is critical, and sadly, often overlooked as part of the agent/client relationship. If you struggle with setting or managing client expectations in your real estate practice, try addressing these four fundamental client expectations at the outset of each transaction.
Expectation 1: The Scope of the Overall Process
One of the best things agents can do for their clients, especially first-time homebuyers, is walk them through a broad level overview of what a typical transaction will look like for the type of property under consideration.
First, ask the clients what previous experience they have had with real estate transactions. Second, ask them if they have any pre-conceived concerns. Third, ask them if they mind you sharing a broad level overview of what they might be able to expect. Finally, have some type of presentation (I recommend print so they can read it as a follow-up to your appointment) that you can walk them through that describes a typical transaction. Customize your presentation to fit the concerns you most often encounter with your clients, such as property access, financial outcomes and potential roadblocks from contract to closing.
Expectation 2: Property Access
Access to the property is a common sticking point between seller and buyers during a transaction. The clearer you can describe what both parties can expect, the smoother the transaction will go.
For sellers, they need a clear understanding of what showings, open houses and inspections could entail. Not only do sellers need to know the proper protocol for preparing a property for viewing, but they also need to understand rules about surveillance, vacating the premises in certain circumstances, and preparing the property for ownership transfer. For buyers, they need a clear understanding regarding booking showings and the implied commitment of time that appointments have. Buyers also need to know how often they will be allowed to inspect a property, who can make onsite visits, and what things can be done to a property (if any) prior to closing.
Expectation 3: Financial Outcomes
Another major expectation that sellers and buyers share is potential financial outcomes. For many people, their home is their largest financial investment. Therefore, both the seller and buyer need to have a clear expectation of how their financial situation will be impacted by the deal.
Agents should prepare a full seller net sheet for their sellers that includes any and all anticipated costs it will take to sell their property against the backdrop of anticipated market value. It is true that an agent cannot anticipate every expense a seller may have, but there are certain expenses sellers will most certainly encounter, and agents should prepare them for those expenditures.
Agents should also prepare buyers for all the expenses that can go into a transaction. They should be educated on loan costs, contract fees, inspection expenses, etc. Advise your buyers to be in close consultation with their lender and to get advice before making any decisions that may impact their credit or the loan process.
Very few things can make people happier or more upset than their money. Do yourself and your clients a big favor by preparing for as many of the financial outcomes of a real estate transaction as possible at the outset.
Expectation 4: Potential Roadblocks From Contract to Closing
Agents would be wise to prepare sellers and buyers for the minefield that exists between contract and closing. Most transactions that do not make it to closing are the result of inspections, the loan process, repair negotiations, appraisals and legal research—all the things that can happen after a property is under contract.
Preparing sellers and buyers for potential roadblocks may not prevent the issues from happening, but it may give you a fighting chance to deal with level-headed parties. Human nature tells us that people typically handle stress and troublesome circumstances they are prepared for far better than things that catch them off guard.
The more you can prepare your clients and manage their expectations, the more success you are going to have as an agent in your real estate transactions.