Meet the Vendor

RAT 112 (Rawlings Agency Tips)

At a time when instructions are thin on the ground, every sale counts, so here’s a way of increasing your offer level and reducing your fall-through rate.

Firstly, people make offers - usually below the asking price. Why do they do this? Is it because they don’t like the house enough? Of course not - it’s because they like it a lot, but would prefer to pay less than the asking price for it.

Then, once their offer is finally, possibly reluctantly, accepted, there is about a 20% chance that the sale will fall through. One of the annoyances of the English property system is that because the window between offer and exchange is so long, the opportunity for either party to withdraw is high. But why do people withdraw? Gazumping, gazundering, change of heart, change of mind, pressure from a friend (or another agent), survey, valuation, etc.

These things will always happen, but it’s the buyer or seller’s response to such issues that determines whether the sale will actually fail. For example, a higher offer might have come in, but it’s the seller who decides whether to allow this to jeopardise the existing sale. Maybe the buyer is considering reducing their offer because the bank valuation was lower than expected.

One of the most effective ways of avoiding these issues is probably the simplest yet least used by agents. Put the buyer and seller together - at an early stage. Some agents might see this as a high risk strategy, but the evidence suggests the opposite and it stands to reason.

Whilst I would never allow a vendor to show a buyer around a property on a first viewing (see my article about this here) it can be very useful on a second viewing and I’d encourage the vendor to invite the buyer round for a cup of tea or glass of wine.

What is achieved here is empathy being shared between a buyer and seller who probably share more similarities with each other than they do with you! They will probably be from the same socio-demographic grouping eg a large family is likely to buy a house that is being sold by another large family. Their children might attend the same school. They may be of the same age and class and even have similar interests. (Try Googling both of them to see what you can find out beforehand!)

The effect is that a form of friendship is being established outside the anonymity of their protected agency relationship. It’s easy to make an insultingly low offer via the agent - but harder to do so when you “know” the sellers and you had a beer with them the previous evening! Likewise, it’s socially awkward for a seller to gazump the buyer when they have discussed how their timing could work out so well in view of the start of the school term.

This is simply harnessing human emotions for everyone's benefit. You only have to meet someone once to say you “know” them, and a host of positive connotations follows. Okay - maybe they won’t get on, but this is unlikely to actually prevent the sale. You as the agent should be able to determine a suitable match!

You might think that by introducing buyer and seller that they are more likely to do some deal behind your back. If you have a good relationship with the seller then this is unlikely, especially as you will have logged the meeting (you could even attend it if you wish, to be on the safe side). If the property is withdrawn the next day then you might want to investigate further and you can always check HM Land Registry down the line.

There will of course be some clients or some parts of the country where you would never dream of putting buyer and seller together, but there are opportunities to create and/or save sales using this idea in many circumstances. So use your judgment and give it a go. You can then use your low fall-through rate in your marketing efforts to drive even more business through your door!