As we discussed last time, discounts, deals, and financial incentives seem to be what homebuyers expect today. As a professional salesperson, you shouldn’t be surprised that they ask for a discount because buyers perceive that since homes aren’t selling quickly and they’re one of the few buyers out there, they should be entitled to something extraâ€”such as a discount. Compounding the salesperson’s frustration is having the prospect say, "It costs too much;" or "Your competition is giving bigger discounts;" or the classic, "You’ll have to do better than that."
So, how do you respond when you hear this?
From the start, it’s crucial that you realize a price objection is not really an obstacle to having them buy one of your homes. In reality, an objection is simply a request for additional information. It’s your chance to substantiate the value of your home and neighborhood. When prospects object to your price, they are inviting you to validate your price over the competition’s offering. They are really saying, "Please justify to me why I should pay what I perceive to be more for your home."
Consider these scenarios:
Prospect: I like your home, but the competition is priced $20,000 less. (or) The competition is offering to discount their homes by $20,000.
Super Achiever: I don’t understand their business strategy! Mr. and Mrs. Prospect, why do you think they would do that?
Prospect: They are having a difficult time selling their homes. (or) They need to sell their homes. (or) Have you looked outside recently? There’s nothing but for-sale signs up and down the street. Property just isn’t selling, so I guess they want to do something to attract buyers. (or) I don’t care/know why, but they are.
Here are some ways you can respond to their request for a discount:
- Super Achiever: May I ask a question, please? Is a brand new home one of the single largest investments of your life? Will you be making one of the largest investments of your life based purely on incentives or how much the home is discounted?
- Super Achiever: Every builder wants to get the maximum selling price for his homes. Wouldn’t you agree? So, are you really getting a discount or are you paying the maximum amount they can get? I ask this because, if you think about it, in reality the discounted price is all the home is really worth.
- Super Achiever: Are you comfortable with the thought that they are cutting prices and deals? I’m just a little concerned. Will you ever know if you got the best price or did someone else get a better deal than you did? And if they are having a difficult time selling their homes, will you be comfortable making the single largest investment of your life in a community where homes aren’t selling? How will this affect their value long-term?
- Super Achiever: Mr. and Ms. Prospect, I do not want to appear discourteous, yet I am puzzled. If you feel it is such a great price, why haven’t you purchased one of their homes?Â Remain silent and let them reply. They will probably say something such as: "I like the price, but do not want to live in the geographic area or in the community." (or) "I like the price, but not the floor plans or housing designs."
- Super Achiever: Ms. Prospect, while it seemed initially that price was your only concern, after talking with you for a while, I think that what you are truly seeking is the best value. Is that correct? Let’s take a few moments to discuss what really is the best value for your family and what meets your investment needs.
- Super Achiever: Mr. and Mrs. Prospect, I’ll admit that not everyone can afford our new homes. That is a reality I have to face. And, if you’re in that position, then please let me know and we’ll focus on homes that are in your price range. However, if the sales price fits within your budget, then let’s talk about value. Let’s review what you’ll be getting when you buy one of these new homes.
Note: This may include its curb appeal, lot size, architectural style, infrastructure (water, sewer, sidewalks, tree-lined streets), community amenities, location, number of rooms, construction quality, builder’s reputation and awards, appliances, "green" features, school-district desirability, neighborhood conveniences and proximity to water/mountains/beach/city/country/recreation.
Next time, we’ll discuss some more scenarios that will provide you with insight into how to effectively respond to these statements…