Everyone is most likely familiar with the adage that when it comes to adding value to real estate, it is “location, location, location” that is the deciding factor.
While I agree that location is a very important element contributing to the appeal and value of a piece of real property, I would like to propose that there is a different commodity that, when present in a real estate transaction, can set the tone and tenor of the entire deal and help ensure a timely and amicable closing: trust.
Each party involved in the transaction, whether it is Seller, Buyer, or real estate agent, has the opportunity to proactively contribute to the level of trust that is fostered in the selling and/or buying process. Of course, the converse of that is true as well: the absence of trust erodes confidence, communication, and successful closings.
Let’s begin with the Seller’s opportunity to set a tone of trust right out of the marketing gate. What may be initially looked upon as a bothersome form, the NC Residential Property Disclosure Statement, is in fact, a wonderful tool for instilling trust. This required form asks the Seller to disclose any and all material defects with the property and provide those details to potential Buyers.
I always counsel Sellers to disclose, disclose, disclose. Think it is too small of an item to put on the form? Disclose it anyway. Had a small leak near the chimney and had it repaired 5 years ago? Disclose it. Had a burst pipe last winter that required a bit of sheetrock repair work in a closet? Disclose it. Think your neighbor’s driveway encroaches upon your property? Disclose it.
It may seem counterintuitive, but when Buyers have an opportunity to fully understand any and all potential property defects, they typically approach the due diligence process with a thoughtful approach. They appreciate the Seller’s candor and work with their home inspector or attorney to find resolution. If, however, a Seller does not disclose a defect, and the Buyer’s first knowledge of that defect comes at the delivery of the home inspection report or survey, then the Buyer tends to be very distrustful of the Seller and wonder what else he or she has failed to disclose. With emotions running high at this point, negotiations may stall and/or the deal may be in jeopardy.
Buyers have a wonderful vehicle for fostering trust in the transaction as well: Buyer Agency.
Simply, Buyer Agency is an agency or fiduciary relationship wherein the real estate agent works solely in the Buyer’s interest and is required to keep all communication from the Buyer confidential from all other parties. In order for a real estate agent to do excellent work on a Buyer’s behalf, Buyers must be completely honest about their desired property parameters and price range, as well as their level of urgency, financial situation, and desired contract terms.
Armed with this information, the real estate agent may go to work to find the best property match and then advocate solely for the Buyer in contract negotiations. With trust sealed and protected by the agency relationship, the Buyer may share any detail with his or her agent and have the resounding comfort that those details remain confidential.
Finally, the real estate agent has a delightful opportunity to be a trusted advisor for each of her or his clients. Being a trusted advisor begins with empathic listening. Great real estate agents take time when they first talk with prospective clients (and continue this discourse throughout the transaction) to determine exactly where they are emotionally and intellectually. What are their expressed and unexpressed needs? What is it that they want to have happen? How, specifically, can the agent be of real service to them?
Once an agent is clear on those details, he or she may begin the education process. Agents may teach from a place of service (not self interest) and help a client truly understand and master buying and selling real estate in our market. The client is then empowered and feels like a knowledgeable partner in the transaction. Trust ratchets skyward.
In any market, but doubly so in a jittery environment, elevating the level of trust among all parties in a real estate transaction creates the optimum environment for clear and open communication, clean thinking, smart decision making, and, yes, the successful crossing of the closing finish line.