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Dealing with Cash Buyers with Your Sellers and Buyers

        

Hey guys, here's a question:

How many transactions would you guess in the marketplace are cash transactions?

The answer is 23% of all transactions in the real estate industry today are cash transactions.

Now, why is that important?

It's important because when we're talking to buyers and sellers, we need to be able to talk about the impact cash buyers have in the marketplace.

So for instance, when I'm sitting with a seller, sometimes sellers will say, "Well, Jim, I only want to sell to a cash buyer."

Now I'll say, "Hey, I get it. I would prefer that too when I'm a seller. Cash buyers don't have an appraisal requirement. And a lot of times you can close faster and it's a little easier. I get it. No lender involved. But here's the reality of those numbers: Today the latest studies show that 23% of buyers are cash buyers. So that means 77% are not. Only about one out of four buyers are cash buyers. If we only want to sell to a cash buyer, we're eliminating three quarters of the buyers in the marketplace.

And I wouldn't recommend that because when you have less of a buyer pool, a lot of times you get less money for the house. I'd recommend we market the home to everybody and see who comes in with the highest bid. That's my opinion. So how do you feel about that?"

And let them have a conversation about it.

Or on the buyer side, I'll say: "Hey, you know, when we're out here in the marketplace, it's still a low supply, high demand market. And when we find a home that really fits your needs, we might find that we're competing in a multiple offer situation. Now, I need to tell you that about 23% of buyers in the marketplace are cash buyers. So a lot of times buyers will think it's impossible to compete with a cash buyer. But it's not true.

We can actually compete with a cash buyer based on the terms of our offer because to the seller, when they close and get their check, it's all cash to them anyway, right? They're getting cash at closing, whether it's financed or actual cash may not matter as much as you think as long as we are super competitive in what we're offering. So that's what I want to coach you, give you some strategy about how we can write the best possible offers so we can beat those cash offers if we're competing with them in the market."

So those are a couple of conversations we could have when we are out there in the marketplace. It will help position you as an expert and help your clients get the best deal possible.

Have a great day guys, good selling, go shake that money tree.

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