Selling with Limited Inventory
What is your biggest challenge in new home sales right now? This is one of the questions we ask new members of Sales365.
Lack of inventory is a popular response so I sat down with Shore Consulting team member Mike Wise. He interviewed me to address some specific questions from our members.
Mike: How are new home salespeople dealing with low inventory?
Jeff: Hopefully, they are learning not to lose sleep over it because they realize it’s something out of their control. Yes, it’s frustrating to tell people who are ready and willing to purchase, “No, I’m sorry, you can’t do that.” However, there are realities in our industry that are out of our control and we shouldn’t allow them to take up too much space in our heads.
Keep in mind, your buyer can still buy a home they absolutely love, they just can’t do it today. It’s our job as sales professionals to help our buyers think in a longer-term process than they were otherwise expecting to. While they can’t buy yet, we can share what the path to buying looks like right now.
Mike: I suppose it’s safe to say that no matter how well we communicate this and work to reset expectations there’ll always be those who don’t want to wait.
Jeff: Again, I’m not going to lose sleep over someone who couldn’t buy. If a buyer has a very strict timeline and you don’t have something available then you really don’t have a buyer.
Mike: If that’s the case, and I’m dealing with a non-buyer, how can I help them move on or at least point them in the right direction?
Jeff: As sales professionals, we are always looking to solve problems. If we can’t help them accomplish their goals because we don’t have a home for them it’s absolutely appropriate to offer suggestions.
Having said that, a warning. Some salespeople carry that mentality around in the forefront of their mind. They hear an otherwise solvable objection, and right away they are thinking about other options rather than fully working through the objection to potentially find a solution that would mean buying from you.
Remember, it’s ok to challenge people a little bit. Try asking something like, “Do you really need to have a place right now? What if we found a way to get you into some temporary housing and get you in a home you absolutely love when it’s ready? Can we explore that?”
Your job as a trusted advisor is to help your buyer explore all their options when making a purchase decision.
Mike: How are builders handling waitlists?
Jeff: It can be all over the map and really depends on the builder. The most common trend I’m seeing is builders asking people to at least prequalify and in most cases leave a refundable deposit to get on the list.
Some builders are also using a bidding process. Similar to resale homes, the market will really drive prices here. They assign a suggested price for the home and go through a bidding process with buyers. This is rare, by the way, and only effective when the market allows.
Mike: Production times have increased due to supply chain issues. What is the best way to address this with buyers?
Jeff: Many buyers will already be aware of supply chain issues because they are dealing with it elsewhere in their life. Try buying a car, or getting custom-fitted golf clubs. The entire world is behind on production.
This makes our conversation slightly more palpable but we cannot assume everyone knows this and has a basic understanding. We have an opportunity to educate people here so they can gain clarity around something they’ll likely see wherever they go.
Your buyers probably won’t be excited about delays but they will really appreciate someone who has been proactively honest and helpful in explaining the scenario.
Mike: Being proactive has never been a bad strategy.
Jeff: Being proactive is not just a nice little touch added for good service, being proactive is absolutely necessary to help your buyer and keep you in their good graces.
Be mindful of what you can control. Focus on proactive communication with your buyers rather than negative thoughts about things you can’t control.
