A new buyer client of ours has graciously agreed to give us "before" and "after" interviews of what his experience with our firm is like, and how it compares to other experiences he and his wife have had working with other firms in the past. This audio is from his "before" experience. We'll post his "after" experience once we've found him a home!
DROdio: Hi this is Daniel with DROdio Real Estate. I'm on the phone with a gentleman who has requested an amity. So we'll just call you Bob if that works for you.
DROdio: Bob sound good, okay. And Bob is thinking about using our company to find a home. Saw us online actually in a Washington Post article and I believe your wife saw one of the videos that I had done. I don't know which video it was, maybe about putting in lowball offers?
Bob: Yes it was. In fact she called me and then we watched it together.
DROdio: Some Friday night movie night. I'm sorry it wasn't more entertaining, but hopefully it was informative at the very least.
Bob: It was quite good.
DROdio: Alright. So the goal of this call is just to help other people who might be in your situation understand what it's like to work with our company or to start the process, but even more importantly you had some really great feedback on your other experiences and what it's been like for you trying to find a home thus far. And so what I am really hoping to do is just kind of let other people hear your story, because I think a lot of people share your frustrations and then we can talk a little bit how we're different. But this isn't a testimonial so much as it's just, you know, telling the world about how it doesn't have to be that difficult.
Bob: Right, right.
DROdio: Right. So can you just kind of start by kind of outlining what your experience looking for a home to date has been like? That might be a good place to start.
Bob: Yeah, sure. I've actually looked here and there and we moved from another state so I had some experience looking in a different state. We moved here to Maryland and I looked at some different areas. I had a realtor that specialized in one area and then I checked out another area and then I finally wound up in the Silver Spring area. I found varying experiences with realtors. Sometimes I'd know right away if it was someone I wanted to work with. But on the other times I'd find a realtor I really like who seems very experienced and knowledgeable and was very knowledgeable. Great at showing me homes and sort of advising me on neighborhoods and the things to look at, you know, location is important, different things like that, that I wouldn't have thought off. You know, pointing out whether the water heater was old or that it was new, if the foundation maybe had a crack or didn't. Things like that they seemed pretty straight forward and pretty good about. But where I always felt confused and disappointed when it came down to talking about money and I don't mean money that I had to spend, which wasn't a ton of money, but I was in the ballpark and the other thing was we're strong buyers in that we would be first time home buyers. We didn't have anything we had to sell so we didn't have any contingencies. Our credit is very, very good and I'm a full time employee and I make, you know, decent money. So that was all good, stellar credit, just like no contingences. I felt that we were kind of strong buyers in that way. Where we were maybe a little weak was on, you know, the money I had to put down and that kind of thing. But what I found was that when it came to discussing a strategy on making offers, whenever I suggested making, you know, making a low offer, that would be my plan, even if they wouldn't accept the offer I was okay with that. The response would be from a couple of the realtors, I worked with two more extensively, not the same time, different time and they would, as soon as I mentioned sort of making a low offer they would bring up, well we don't want to offend the seller. We don't want to offend the seller. I thought to myself, I don't want to offend people, but how would I ever know if they would accept a lower offer unless I made the offer or if at least the realtor would call the listing agent and find out what their story was. How motivated they were or you know, for all they know, you know, the people they've had it listed for 60 days or a 100 days, they may just really want to get out of there and they may have bought the house for a lot less money and they paid it off and that doesn't mean that they have to sell it for less, I mean they should get market value for their home, I understand that, but maybe they see this young couple that's first time home buyers that they can close quickly and they say, gees you know what we'll take that price or they'll counter with a slightly higher offer. But these realtors would totally discourage me from even thinking that way. And they would look at a place that was X amount and they'd say with assurance this place will never go below X before even calling the listing agent. So I want to tell a quick story on that DROdio. First of all we saw the video and we really liked the strategy that you have Daniel and the different software that you designed and all that. I mostly liked your strategy on making lower offers to find out, test the waters. And when we met with…I'll just speak about you in the third person. When we met with Daniel he said are there any properties you're interested in right now and we said yeah, there's a few. And he said, would you like me to call the listing agent and find out some information for you about the sellers and we said that sounds great. So he called the listing agent right with us and he found out within 60 seconds he found out the information, you know, that the sellers were motivated to sell, but that they had a lot of money invested in the property. I think they did actually put some work into the property, the only bought it very recently, that's something we knew from Zillow anyway. But basically in 60 seconds he got the listing agent to tell him basically that they would, well they wouldn't come down more than fifteen thousand.
DROdio: I call that getting the seller to negotiate with themselves. That's one of my favorite things.
Bob: This is something I had the feeling that Daniel would do just by watching his video and talking to him briefly on the phone before we sat down together. That's something no other agents even come close to doing. They wouldn't even make that call for me. So what I felt and I felt all along, even though I liked these people and they were good at some things, I felt like I was totally alone when it came to making the offer. Although I had a lot of confidence it definitely zapped my confidence. I thought well gees, maybe I shouldn't be offending people. Maybe buying houses is totally different than buying cars or buying guitars on line or doing all these other things I've bought in the past, you know.
DROdio: And it's not. I mean it's not at all. There's this culture among real estate agents and I guess I didn't realize how pervasive it was, but what you're saying is really making me rethink this is a much bigger problem in our industry than I realized, because part of it might have to do with the fact hat a realtor is going to have to work with the agent again in the future and they don't want to be too aggressive with that agent. But at the same time the sellers that are behind these listing agents a lot of times they just want to see offers, they're just desperate for offers, no matter how low the offer is. I don't think there is such a thing as offending the seller in this marketplace right now.
Bob: Daniel I felt like they were two roadblocks at all times. My realtor was the first roadblock and then the listing agent was the second roadblock between myself and the seller. I thought a little bit about looking into like listings by owner, but then that made me nervous, because I had never bought before so I just thought oh God, then I'm going to get into the whole like paperwork I don't understand . I need a realtor for that.
DROdio: Plus, you know, in that kind of situation everything can go fine, but if you make one mistake it can cost you twenty thousand dollars. So that's the real risk is not saying one thing correctly or not doing one thing correctly, you know, not doing the right kind of inspection or not putting the right inspection contingency in it and then it's got a cracked foundation that you didn't know about. Or you know, one great example was where a seller had built the property over the property line so technically the property was in violation of D.C. code and the only reason that we knew that was we as professionals thought to check the code to see if there were any problems and in fact the whole half of the house would technically have to be torn down if D.C. ever found out about this, this property being built over the lot line. I don't think that's something that most people think to check.
Bob: My point exactly. I want to tell a really short story.
DROdio: Please, please.
Bob: I went and saw a house with the realtor. I trusted his opinion very much and he said, this place is listed at X, you'll never see it go below X. This only a couple of months ago. The market is not doing all that well here, people are selling for less. He said, you look at the comps, this place will never go below. I'll give you the numbers, let's say the price was, I'm going to make up the numbers. Let's say it was four hundred. He said, you'll never see this place go below three-ninety. That's as low as it will go and I sat there thinking how does he know this. There must be this whole subculture going on where he's already spoken to the listing agent, he knows what's going on or is he just guessing. I thought how does he know this, you know. So I kind of was like oh well, you know, I don't want to fight the guy on it. Gees, you know. I kind of do, but I'm thinking I don't know, you know. The next thing you know we looked a month later, you know, we're following with the realtor.com and all that to see the listing and it drops another like thirty grand. They dropped it, the sellers dropped the price. He was wrong. He totally discouraged me from and they dropped it almost exactly where I was thinking of offering.
DROdio: That must have been really, really frustrating.
Bob: That was an eye-opener for me, because that's when I said, well gees, you know what my instincts have been right.
DROdio: So to kind of tell everybody who's listening or reading this, because we'll transcribe this into text so people can read it. So tell everybody whose reading or listening, you know, our interaction to date has been that I sat down with you for a couple of hours yesterday and we had a great conversation about your goals and everything. We basically sat down for coffee which is something that we offer to do with anybody to help kind of strategize. So you've been very gracious in doing this interview, because this is really a before interview. We haven't even shown you any homes yet. So it will interesting to get your feedback after the process is through about how it differed from your expectations and what was great and what we can do better and all that good stuff. But just kind of looking at what you're expectations are, how has your experience so far been different from other agents that you've worked with? One thing is just strategizing has been a real important thing for you and not making any assumptions about what sellers will take. I guess a lot of realtors do, I didn't even realize that pervasive thing. I think it is. What are some other differences that you've noticed so far that are interesting.
Bob: Well I think validating us as buyers and not in a salesmen like way, which I've often had, but in a realistic way. And also not rosying up for us. We definitely talked a real strategy, you know. I am not naive that you can go in with zero down and no earnest money and all that. We talked about that in an honest, with an honest approach. When I mentioned what we have for money, which is not a lot, we don't have a bunch of money from a house that we sold or anything like that. Daniel, you've just talked honestly with us. You didn't talk down to us. I often felt when it comes to the strategizing and making the offer and the money we have, what we bring to the table financially I've been talked down to. I just feel like a lot of the realtors and I'm sure you as well, you know, you bought properties and you sold a lot of properties, they are in a whole different bracket than where I'm looking. I'm looking at places it's a lot lower dollar wise and I feel that, you know, sort of like any company that would sort of devalue their clients who are like spending less with them, which I've learned in my business is the wrong approach. You should treat all of your clients the same way, because often, I've found the clients were spending less eventually start to spend more and the next thing you know they're the big clients too. And that's not the only reason, I just think that everyone should be treated with respect anyway. I felt that was a difference is that it was not, I wasn't being discouraged, but I wasn't being encouraged in an unrealistic way is what I thought.
DROdio: I think the big problem with our industry as a whole is that realtors just look at a buyer as a one time transaction and if the dollar value isn't, you know, what they're used to dealing with they don't think it's worth their time. But with this technology background that I have I'm really trying to establish a relationship for the next, who knows, twenty- thirty years where yeah you will buy and sell multiple properties and we want to be advisors to you over that time period. So you know, people do tend to trade up in homes and this is your first home, but it probably won't be your last home. And I don't think a lot of realtors kind of see that macro view just because it doesn't happen quickly. You know, people live in places for five or seven or ten years on average.
Bob: They say they do and they usually mention that, but their reputation is fake and they will never, they want to make us as clients happy and they're working for us and all t his kind of like sort of buzz word phrases. But when it comes down to like, well gees, you know, we looked at a house where this older, elderly woman owned the house. I'm not looking to take advantage of any sort of elderly woman, but I mean she's already, you own, what's your deal. She's moving out of town and it's been in the family for well over thirty years, paid off, it's at a certain price. I'm thinking gees, you know, what could we offer for this. You know the market's in decline. If we buy this for what she's listing at or for five thousand less than what she's listing it at, it's going to be worth less, probably, in a year, two maybe. Who knows with this market. I'd like to feel them out and find out how motivated she is. And that just sort of feels like a wall goes up. It's like I don't have, it's like the other side has lawyer representation and I've got, I don't have that. Like I just don't have someone on my side.
DROdio: Well you do now.
Bob: Financial strategy. Well now I feel like I do.
DROdio: I think, you know…
Bob: Well Daniel you promised that my post report on this will also be posted.
DROdio: Right. Oh absolutely. No matter how your experience is we will be doing the before and after. So believe me I hope it's a good one. But yes, absolutely. And one thing that I've really noticed is that just like anybody, realtors want to maximize the value of their time and the model, the business model that most realtors work under that means that they can't afford to spend time with people who aren't going to put in sure thing type of offers, because the average realtor only works with a couple of clients at a time and they have to sell a property that month or else they're not going to be able to feed their kids. And I think that's a real problem in our industry, because it makes realtors very pushy. And every client that we have has a bad experience about a pushy realtor. And so, you know, our model is just completely flipped. Instead of working with a couple of people at a time we have a hundred or a couple of hundred people that are kicking the tires, using our technology and tools and that I'm talking to via phone and email, that our agents are talking to. And then there's just this natural trickle down of people that are ready to get serious and because we can be more efficient putting offers in, you know, there's things that we do like being able to electronically stamp signatures and email them to you for approval. It's okay to make these lowball offers, it's not a waste of time. I mean it's really never a waste of time, but in many realtors' eyes it just is such a drain on their time it's not worth doing except for themselves, they probably still do it for themselves, but they just don't do it for clients, because they don't have the time with the way their business structure is set up.
Bob: The way they have it set up. They don't think they have time, but I mean the truth is if they would make the offers that you want to make wouldn't they eventually get more sales. I don't know. I think also I've found, my feeling was that they were protecting not just the seller, but they are kind of protecting the industry. They are trying to protect the value of homes. Like if we go in and we get a deal on the place in a neighborhood well that's a comp now that shows that the neighborhood is declining, we want to protect the value of the neighborhood. And what it's doing if you look at, it's making, that strategy on that part is making homes unaffordable to a lot of people in neighborhoods, in good neighborhoods.
DROdio: You know that's very true. That could very well be part of the motivation with the standard agent, because they do tend to only work very small tight neighborhood communities. Our model is much different. Our model focuses on the strategizing piece and on the negotiating the offer piece and we don't focus so much on the showing homes piece, because A a lot of people want to see homes on their own, they don't want to have an agent breathing down their neck. So we loan out free GPS machines and we provide the addresses of homes that are for sale and we tell you, you can search for open houses. You know, we are absolutely happy to show properties to people when they kind of have an idea of what areas they're interested in. But I don't think that the realtor's greatest value is in showing the homes. I think there's value in walking the properties that you're interested in and helping you identify the value of the property. But in terms of just opening a property for you and you say, no, not interested go to the next one. You know, doing that twenty times I think a lot of realtors think their value is there and really I think they just want to be in the car with you to be talking you up to kind of make you drink the coolaid that they're serving.
Bob: You said another thing to me yesterday that was real interesting and stuck in my head. You said when you walk into a home, you know, your prospective buyer walks into a home, don't say to yourself I like this house or I don't like this house. Think to yourself what value would I place on this.
Bob: Because the truth is no matter what house it was you could place a value of probably, you'd probably spend a dollar for a house or maybe you wouldn't if it wasn't worth the headache, but you know, what I mean. If you're looking in the three hundred thousand dollar range let's say and you found a place that just really didn't suit your needs. You might it for, you know, in other words you could always set some sort of a price for it. That's a really smart idea, because if you're not afraid to make a low bid on a place than you could assess the value to any place you see. And you also, I think you might be helping someone out. If they had the place on the market for a 150 days and no one's making an offer, you make a low offer you get them out of that place. They might be paying two mortgages.
DROdio: That's exactly right. That's one of the main things that if there's any message that I can communicate to prospective buyers and to you as well as you go through this process, it's the main thing that stops people from buying property is that they don't think they can and it sounds so cliché, but it so true. People limit themselves. You know you could do a deal on the back of a napkin and you could tell somebody I will pay you one dollar for this property and I will take over your mortgage payments and maybe the person just wants to get out of the house and they would be willing to sell the house for a dollar and have you take over the mortgage payments. I mean that's just an extreme example of what's possible. Anything is possible.
DROdio: There are no limits on…
Bob: Yeah. Like I've had things that I needed to sell and I've sold things for like too little before, because I just needed the money, I needed to get rid of the stuff.
DROdio: Or maybe…
Bob: It can be like that with anything.
DROdio: Money may not be your primary motivation. Maybe you just want to get out and see a family come in that's going to take good care of the house that's going to enjoy the house. We've had buyers and I know that you mentioned it, that you had seen this as well, that have written emotional letters to sellers. I've had a buyer win a bid that was ten thousand dollars under the highest bid because they wrote an emotional letter to the seller. I mean money is not always a seller's primary goal. Usually it is, but not always and that's the thing. If it's one out of ten you have to make ten offers to find that one where it's not. And that's the thing.
Bob: And you're the first realtor I've spoken to that is willing to make multiple offers.
DROdio: Oh yeah.
Bob: They kind of say they are, but whenever you start to discuss it after you seen a few homes that goes away. That disappears.
DROdio: That's a core part of our strategy and I encourage you take advantage of it, because like I told you yesterday what a lot of buyers do is they start saying this is a lot of work, this is frustrating, we're under a lot of time pressure. I mean it's a lot of work to make multiple offers and not only does the realtor have to be ready to do it, which we are, but you as the buyer has to be ready to do it and only you can decide whether or not you are. You know, make sure that you kind of prioritize the importance to you of getting that really good price versus the value of just emotionally finding a house that you like, because those are often contrary. You know if you just walk in and you say, oh honey I love it, you lose all of your leverage. You have to walk in and say, what's this property worth to me.
Bob: We learned that the first, before we moved here in the first state we looked at we were going to homes and my wife would say, honey we could put our table over there, the backyard is great for the baby. When we get outside I'd say, don't say that in front of the realtor.
DROdio: The listing agent loves to hear that.
Bob: Oh yeah.
DROdio: Yeah. No, no. I don't know if you've seen that show the dog whisperer. Have you seen that show it's on the TLC or the National Geographic Channel. You know, the thing that I took away from that show is that Cesar the dog trainer has to train the people as much as he trains the dog, in fact maybe even more to take care of their dogs correctly. It's really the person trainer and that's so true with buying property.
Bob: Super Nanny too.
Bob: They are training the parents.
DROdio: Exactly. Exactly. And as buyers you have to train yourselves to think logically about a very emotional process. And I understand it being a very emotional process. But so it's very difficult to think about it logically, but if you can there are lot of good deals out there. It's just a matter of finding them.
Bob: Well thank you Daniel. I can't wait to see how this proceeds.
DROdio: Yes, it's a pleasure. And as you know you can call me any time. I work until midnight every night. So if you guys have questions and it's late don't hesitate to call. I believe your wife is out seeing some properties with us right now. So we'll see how that process goes.
Bob: Well thanks again Daniel. I appreciate it.
DROdio: Thanks so much for the time, I appreciate it. Take care.
Bob: Okay, bye, bye.
DROdio: Alright, bye, bye.