VanEd Newslog

SOI 104: The Four Branches of Your Sphere of Influence

I recently got a question from an agent I've been consulting with. She asked "So, my goal is to expand my Sphere of Influence database to a certain number by the end of the year?"

Well, sort of. At least, that's probably one of her goals. But as I answered her question I realized that there are really four different branches of a Sphere of Influence thus four different "goals" to shoot for as you build your Sphere of Influence business. 

Here are the four branches:

1. Your Direct SOI - that is - the people you know
2. Your Indirect SOI - that is - the people your SOI knows (i.e. referrals)
3. Your Third Generation SOI - that is - the people you meet via your SOI
4. Everyone Else - that is - every single person you encounter in your day-to-day wanderings

Your Direct SOI
These are the people who know you and know you sell real estate. It's made up of your Group One (your social network) and your Group Two (those people you know that you don't socialize with). You should try to have at least 200 warm bodies there; of course, more is better, but they don't "count" if the person wouldn't recognize your name off the bat. These are people who KNOW you, even if they aren't your best friends.

You'll get business from your Direct SOI, but it probably won't be your primary source of closings. Most of aren't blessed with an SOI who buys and sells houses on a regular basis!

Your Indirect SOI
These are the people your Direct SOI refers to you, who, of course, will be added to your Direct SOI once you've met. Your Indirect SOI should be a fairly consistent source of business for you, assuming your Direct SOI thinks a lot of you, and they know how to find you.

Your Third Generation SOI
These are the people you serendipitously meet as a result of your existing personal relationships. For example, back in 1996, I met my second and third clients ever at the wedding of a mutual friend. I met another client at a Pride parade I attended with my GLBT friends. Another at a Super Bowl party. Stuff like that. This can be an enormous source of business for you, if you're often out there in the world with a smile on your face and your antenna up, and can speak intelligently about your local real estate market to anyone who's interested (and please don't bore those who aren't!)

Everyone Else
These are the people you run into during your daily travels. Every single person you meet, every day, has the potential to be the newest member of your Direct SOI. Not all will, of course, but you never know who will end up being your biggest fan. It might be that young couple who stumbled into your Open House who had a child the same age as yours. Or that woman standing next to you at Ace Hardware getting a key made, who casually mentions she just moved to town. That guy you meet at the dog park. Your neighbor three doors down who is looking for his lost cat. The woman who calls you off your Craigslist ad to purchase your roller blades.

Again, HUGE potential with this category - if not today, then next month or next year.

So, those are the four branches of your Sphere of Influence. How might you adjust your goals to incorporate all four?

Guest Author Jennifer Allan-Hagedorn has authored multiple books and courses designed to teach agents her Sell with Soul philosophy that centers on four interrelated principles: Respect, Competence, Confidence and Enthusiasm.  The latest release of her book is available in the VanEd bookstore. You can also visit her online at www.sellwithsoul.com or attend one of her free teleseminars on a variety of topics of interest to the real estate community.

Colorado Real Estate Commission plans E&O Insurance rule update to help Indpendent Brokers

On June 5th at the real estate commission meeting in Denver the commissioners will be voting on a change to Rule D-14 - Errors and Omissions (E&O) Insurance that would change the requirement that companies with only one licensee carry separate E&O Insurance policies.

Under the current rule, every licensee, as well as all real estate companies, must carry at least the minimum required amount of coverage. This current requirement means that Independent brokers who open a company but do not employ additional licensees in the firm must carry a separate "company" policy. This has the effect of duplicating coverage for those licensees who choose to work alone.

The new rule would require a company policy only for those firms that have employed licensees in addition to the supervising broker, effectively eliminating the need for an Indpeepdent broker to have a company policy E&O policy that duplicates the coverages already in place under the licensees individual insurance policy.

The proposed language change to Rule D-14 is below. (Note: only the portion of the rule being reviewed for change by the commission is posted here. For the full notice you may go online to http://bit.ly/IHsLWt)

SOI 102: The SECRET to a Successful Sphere of Influence Business

Sphere of Influence = The People Who Know You

Wanna know the SECRET to running an effective Sphere of Influence business?

The secret to running a successful SOI-based business is to be a great real estate agent who loves her job and knows her market and stays in touch with the people she knows, without ever pestering them for business or referrals.

That's it! That's the secret! To be a great real estate agent who loves her job and knows her market and stays in touch with the people she knows, without ever pestering them for business or referrals.

Let's take these items one by one.

You're a great real estate agent
This is huge. Being a great real estate agent is not the same thing as being a great real estate prospector, even though that's what most of our training tends to imply. Being great means that you take  care of your clients as your first priority, not as an afterthought when your prospecting is done. Doing business this way helps you on so many levels. First, obviously, you'll have happy clients who will be delighted to refer you to everyone they know. Second and third, you'll be proud of the work you do and confident in the work you do, which will lead to the second requirement -

You love your job
When you're good at what you do and you know it, you'll probably absolutely love your job. And that excitement and enthusiasm is contagious to those around you.

When you're able to hold your head up high and announce that "I'm a Real Estate Agent and it's the Coolest Job in the World!" people will be drawn to you - as one agent I know puts it - they want some of what you're smoking! When the topic of real estate comes up in a social setting and you're able to say those magic words "I'm a real estate agent and it's the coolest job in the world!" people will ask YOU for your business card. It's beautiful.

Which leads to the third requirement:

You know your market
The best way to build rapport with strangers is be master of your market. If you know your local real estate market, and you KNOW you know your local real estate market, you'll find opportunities to share that knowledge all over the place.

It's amazing how much confidence this gives you and it's pretty easy, to strike up a conversation with a total stranger about real estate... if you know what you're talking about. You'd be surprised how many people will ask YOU for your business card if you sound like an expert.

So, for someone who needs to build a Sphere of Influence database from scratch, they should spend some quality time learning their market and putting themselves in social situations where they can share their knowledge with people who are interested.

You stay in touch with the people you know
This, of course, is really important. If you know a whole bunch of people, but you never make any effort to have a personal interaction with any of them (above and beyond drip campaigns), your sphere of influence efforts will crash and burn. To be someone's favorite real estate agent, you either need to have done a fantastic job for them in the past (and stayed in touch) or make an effort to be in touch with them on a somewhat regular basis. Especially if someone hasn't used your services before, it's really easy for another agent to swoop in and take your place!  

Just know that yes, if you intend to generate business and referrals from the people you know, you will need to take time to talk to them.

You never pester anyone for business or referrals
The last requirement is that you never pester the people you know or the people you meet for business or referrals. This is a tough pill to swallow for many agents. We're trained to ask for business and to make sure that everyone we know and meet is aware that we are desperate for business. I know, that's not what we say - but it's how it comes across. When we constantly or even sporadically remind the people we know that We Love Referrals, we send a message that is counterproductive to our goal of actually generating referrals.

Sooooooo.... Are you a great agent... who loves your job.... And knows your market.... And stays in touch with the people you know without ever pestering them for business or referrals? Excellent!

Guest Author Jennifer Allan-Hagedorn has authored multiple books and courses designed to teach agents her Sell with Soul philosophy that centers on four interrelated principles: Respect, Competence, Confidence and Enthusiasm.  The latest release of her book is available in the VanEd bookstore. You can also visit her online at www.sellwithsoul.com or attend one of her free teleseminars on a variety of topics of interest to the real estate community.

Are you missing agent reboot™ happening today in Denver?

We you unable to attend agent reboot™ today in the Denver? No worries. You can keep up with what is going on by following on twitter using the hashtag #agentrb (see below).

Not sure what agent reboot™ is?

Agent reboot™ (brought to you by Inman News) is a seven hour "mini-connect" where agents can learn practical ways to use mobile technology, social tools, video and other technology to improve business. Various speakers are offering practical tips and advice that agents can use in the field right now. Ideas, concepts and tools that agents can use in the future (or that might be new or even as of yet unknown) to help increase productivity and customer attraction. News and information are also shared.

Check out the agent reboot™ experience on the website at http://www.agentreboot.com/ or follow the twitter stream below to stay current on what is happening today. We encourage those who missed today's event to also consider traveling to a future Inman event.

 

 

SOI 101: What Exactly is a Sphere of Influence (SOI) Business Model?

A Sphere of Influence business model is a strategy that focuses on attracting business to you from the people you know and the people you meet socially, as opposed to pursuing business from strangers. It's possible to run a nearly 100% SOI business and never have to make one cold call, memorize a prospecting script or knock on a strangers' door!

There are three primary activities in an effective SOI business model.

1. Nurturing the personal relationships you already have within your social network (that is, your friends - I call this group my "Group One." Clever, eh?)
   
   
2. Staying in touch with "everyone else" (that is, the people you know who aren't your friends - I call them my Group Two)
   
   
3. Meeting new people.

Before you panic and say that you don't have the time, money or energy to do all this socializing, don't! Running an SOI business is much less time-consuming and less expensive than just about any other systematized prospecting method, and can be far more effective, more quickly. 

Nurturing the personal relationships you already have
From a philosophical perspective, this means to ensure that the people in your social network (AKA Group One) know that you care about them. In a practical sense, it means that you strive to have a personal conversation with everyone in your social network as often as you can, at least once a quarter. A personal conversation can be a face to face lunch or coffee date, a phone call or even an email exchange. What it's not is a concerted effort to abuse your friends with a sales pitch. Always approach your social network as a friend first, and a real estate agent second, or third, or fourth.  Not the other way around.

Staying in touch with Everyone Else
Staying in touch with your "everyone else" group (AKA Group Two) just means that you keep your name in front of this crowd with periodic interesting, relevant, non-salesy written communications, delivered both through snail-mail and email. As long as your mailings are consistent and intelligent, you'll see a significant number of sales from even this minimal effort.

Meeting new people
An important part of an effective SOI model is to add to your Groups One and Two, especially in today's market where there is admittedly less business to go around. The more people you know, who know you, and think you're a generally cool person, the more that telephone will ring.

Running an effective SOI business model isn't nearly as complicated as some would have you believe. Yes, it takes some organization and commitment upfront, and an ongoing effort to stay in touch with the people you know and the people you meet, but once it's rolling and you're in the SOI habit, it won't feel like work at all! In fact, it might even feel suspiciously like FUN! And "the more fun you have selling real estate, the more real estate you will sell!"

Stay tuned for SOI 102: The SECRET to an Effective Sphere of Influence Business Model

 

Guest Author Jennifer Allan-Hagedorn has authored multiple books and courses designed to teach agents her Sell with Soul philosophy that centers on four interrelated principles: Respect, Competence, Confidence and Enthusiasm.  The latest release of her book is available in the VanEd bookstore. You can also visit her online at www.sellwithsoul.com or attend one of her free teleseminars on a variety of topics of interest to the real estate community.

It's already Spring and Tax Day is upon us ~ Have you taken time to create a Marketing Plan yet?

It's time to revisit marketing plans again!

If you didn't sit down in December to create your annual marketing plan, then now is the time. As the Spring market season quickly approaches agents should be getting ready now for what we hope is the busy season just ahead.

Do not worry about market forecasts or interest rates or even company advertising bills as you sit down to start planning. Instead, focus on what you can do to increase your personal traffic. Focus on your direct expenses and don't worry about indirect expenses that arise out of any given transaction. (Why not worry? Expenses are bad!) While you can save for a rainy day, you can't determine what calamity will befall any given transaction in advance, so planning for it won't help. Besides, we're looking for a positive year!

Clear some time in your schedule at the office. Don't plan in front of the TV while watching a congressional hearing or ER or even The Office. I assure you that your mood will be affected by any of those shows, and when planning it is best to keep an open mind to help you set some realistic goals and schedules. Another good reason to do this at the office is so that if you need help identifying what you did last year or the year before, you will be where the files are. Easy access to records will help speed up this process.

Now begin planning!

Sounds easy, but isn't. There are a variety of good resources out there that will help you get started. Programs such as Act! offer tools to help agents be more productive. I suggest that you start by reading a little bit on planning and goal setting, and Realtor Magazine Online has some good suggestions on where to start. You can read the article 8 Step personal marketing plan online. There are also links there that will show you sample plans and give you tips on Niche marketing and other areas that you may want to focus on. It's a good place to start, and now is the time.

Need a coaching program? Kelle Sparta of Sparta Success Systems offers an online coaching program that will help you identify your goals and plan and get you going.

Show Your Client the RESPECT of Declining the Monkey!

In the previous installment of this Newslog series, I wrote about CONTROL. Specifically, which issues of a real estate transaction (i.e. “Monkeys”) YOU control; which ones your CLIENT controls and which ones neither of you has any say over. The point in spelling it all out wasn't to give anyone permission to be rude to a buyer or seller when he tries to hand off his Monkey; no, rather to clarify which Monkeys are appropriate to decline. ("Declining the Monkey" means to refuse to accept responsibility for problems that are not yours to solve.)

 

Believe it or not, politely declining to take on your clients' monkeys has a lot to do with respect. Respecting your CLIENT'S intelligence, abilities and willingness to do his part. Acknowledging that your client has a brain and a checkbook, and that he can probably find some free time. A lot of us don't seem to give our clients the benefit of the doubt that they are willing or able to do their part, so we either offer to do it for them or walk away frustrated.

 

Sure, an upside-down seller will be more than happy to dump his upside-down monkey on you, if you agree to take it. A frustrated buyer would be tickled to let YOU figure out where that extra 5% down is going to come from when the terms of his loan change. But you CAN gracefully hand that monkey back to the buyer or seller without his even noticing the hand-off!

 

Let's use the example of the seller who owes $415,000 on a house that might be worth $399,000. To come out whole, he really needs to sell around $430,000. Oh, and he DOESN'T want to come to the table with money, or short sell the house.

 

What do you do?

 

Of course, you can refuse to take the listing, and indeed, that's what you might end up doing. Or you might agree to take the listing at a too-high price, and regret it every day for the next six months. But are those the only two options?

 

NO!

 

There is another solution to this problem. One that may result in a sellable listing. What IS this magic solution?

 

I don’t know. Neither do you.  

 

It's your seller's solution to discover. And if you let him keep his monkey, he may very well come up with the solution on his own. Maybe he'll decide to kiss up to Aunt Lulu and ask her for a short-term loan to cover the spread. Maybe he'll decide a short-sale isn't out of the question. Maybe he'll agree to make the improvements you recommend to give him a better shot at a higher price.

 

Or maybe he'll come up with something brilliant none of us thought of.

 

But... but... but... how DO you show your prospect or client the respect of letting him keep his own monkeys? What do you say? Or not say?

 

    Stay tuned! 

 

 

Guest Author Jennifer Allan-Hagedorn has authored five books and multiple courses designed to teach agents her Sell with Soul philosophy that centers on four interrelated principles: Respect, Competence, Confidence and Enthusiasm.  Her first book Sell with Soul is available in the VanEd bookstore. Her new book, Prospect with Soul for Real Estate Agents can be found online at www.sellwithsoul.com.

Our favorite stories this week include angry chefs, green property valuation and low appraisals, sooo.... hold the blowfish?

Here are our favorite stories from this week, as reported by the VanEd staff, students and industry sources. It's probably no surprise that food, green building and a story about a low appraisal all made the list. We're diverse like that. :)

Did you know that Old Buildings can learn New Tricks? An article on the Sustainable Business Oregon website says yes. In her article, Caitlin Powell notes a study showing that by renovating an older warehouse (or potentially a mall?) and using 6 to 8 percent fewer resources than on demolition and new construction, contributions to climate change can be reduced by as much as 9 percent. Other stats are even more impressive.

Read more --> http://www.sustainablebusinessoregon.com/columns/2012/04/old-buildings-can-learn-new-tricks.html?ed=2012-04-03&s=article_du&ana=e_sbo

 

You know it is still an interesting market when the Past President of the Appraisal Institute, a Tennessee Real Estate Broker, loses a deal over a low appraisal and then gets an article on CNN Money. Read the article and then decide: Are banks sending messages to appraisers to keep valuations low?  http://cnnmon.ie/HcdwZ7

Don't think the appraisers are just one sided, though. They're still working on Green features as they ask If Energy upgrades add value to existing homes? The appraisers discuss this in an Appriasal Scoop post.    http://bit.ly/GTtZOf

Appraisers also have to deal with the Uniform Collateral Data Portal® (UCDP®), a single portal for the electronic submission of appraisal data files to Freddie Mac and Fannie Mae that facilitates the electronic collection of appraisal report data. Appraisal report forms for all conventional mortgages delivered to Freddie Mac on or after March 19, 2012, must be submitted to the UCDP. For more info visit http://www.freddiemac.com/sell/secmktg/uniform_collateral_data_portal.html. 

 

Ever ask what happens to all the hats that land on the ice after a hat-trick in hockey? We didn't until the Colorado Avalanche put the question to those who pick them up in this online video: http://video.avalanche.nhl.com/videocenter/console?catid=1027&id=103305 (and hey, now we know!) 

 

And what is with the regulators in Tokyo? The deadly poisonous Blowfish can kill you with a look (ok, an eye....seriously, the eyes, heart, liver... all more deadly than cyanide!). And now food regulators are easing restrictions for those who want to cook these deadly delicacies. Seems to us tha loosening standards for chefs who specialize in blowfish seems like adding risk to an already "fishy" proposition. 

See what we mean in this Rueters article: http://www.reuters.com/article/2012/04/03/us-japan-blowfish-idUSBRE83202P20120403

These stories and many more were or are available on one of our social network sites listed below. Please join us there!

Be aware of asbestos issues in older properties

As a new homeowner or potential seller, it is not likely that you are acquainted with the inner materials of a home. However, most buyers seek an updated home inspection before closing on a new property. It is important to reassure buyers that the home is safe and does not contain any potential health hazards. These inspections are critical to clearing hurdles down the road that may slow the sale of property.

One of the most common surprises new homeowners and sellers confront is asbestos in older structures. Indeed, asbestos containing materials (ACMs) are now banned for use in the United States but many older buildings still contain these products, which are generally safe, but homeowners should be aware of where they and when they become hazardous.

Asbestos was included in thousands of construction products and still exists in nearly 80% of homes built prior to 1978. Common asbestos materials include attic insulation, ceiling tiles, and pipe lining. Asbestos was particularly adept at insulation and prevention of temperature transfer and was used extensively until adverse health effects began to manifest in those who worked with the material frequently.

It is only when asbestos containing materials are compromised or very old that they become hazardous. Asbestos products under these conditions are rendered “friable.” Home inspection companies should be able to identify these circumstances and advise you on a course of action. When asbestos material is friable, asbestos fibers can be released into the air, potentially endangering those in the area.
Inhaled asbestos fibers lodge in the body’s inner tissue and have been conclusively linked to the rare cancer, mesothelioma in addition to many other respiratory disorders. There are few options for mesothelioma treatment or curative therapies for other conditions caused by sustained asbestos exposures. Homeowners need to be aware of potential hazards that may exist so they may be able to avoid potentially harmful effects of hazardous asbestos.

Again, most asbestos containing materials will not pose an immediate hazard and an informed buyer will not be turned off by their presence if they’re reassured of their safety by a professional opinion. These simple precautions can be taken to assure that both sides know that they and their families will be happy and healthy in their new home.

Information courtesty of the Mesothelioma & Asbestos Awareness Center - Online at http://www.maacenter.org. Learn more about Environmental Hazards Screening by taking the online course - available through VanEd. Click here for more information on this MRE course.

Connect with us on one of our social network sites listed below!

Declining the Monkey without alienating your client

In my last Newslog article, I promised to expand on my opinion that it’s possible avoid burnout by “Declining the Monkey” with a client or prospect – and that it’s preferable if you Decline that Monkey without alienating your client.  

  

 

“The Monkey” is Terry Watson’s description of a problem or dilemma that ISN’T your problem or dilemma, but someone else wants you to take responsibility for it. Happens all the time in real estate, doesn’t it?

  

The first trick to respectfully declining your clients' monkeys is to know which monkeys are appropriate to decline … and which are rightfully yours to carry.  Yes, when our clients hire us, they have a right to expect us to take on some of the burden of their real estate transaction. Entering into a real estate agent/client relationship creates responsibilities on each side. The clearer you are on whose responsibilities are whose, the easier it will be to assign them to the appropriate party.

   

Put another way, what factors of the transaction are within your control, which are within your client's control and which are out of either of your control?

  

 

You control:

 

• the services you are willing to provide

• the marketing you are willing and able to do

• the price at which you are willing to take a listing

• whether or not you will take a short-sale listing

• the times you are available to your buyer

• the expertise you have in advising a seller how to prepare for market

• the resources you have in place to help a seller prepare for market

• your willingness to show short sales, foreclosures, FSBO's or new construction

• how often you will communicate with your client

• how much you charge for your services

  

 

Your client controls:

 

• the price he is willing to list and sell for

• how much he is willing to "come to the table with" if he's upside down in his mortgage

• whether or not he's willing to short-sell

• the amount of work he is willing to do and the funds he has available to prepare for market

• the times he is available to look at houses

• what marketing services he will require from his agent

• how much he is willing to offer on a home

• whether or not to allow unrestricted showings

• whether or not he wants to pursue short sales, foreclosures, FSBOs or new construction

• whether or not he is happy with the inventory in his price range

• how much he is willing to pay for real estate services

  

 

Neither of you controls:

 

• changing lending requirements

• overall market activity

• the cost of home maintenance and repair

• interest rates

• closing costs

• the underwriter

• the agent on the other side of the deal

• the buyer or seller on the other side of the deal

  

 

So, how are these "control" issues relevant to getting the various monkeys assigned properly?  

 

Stay tuned!



 

Guest Author Jennifer Allan-Hagedorn has authored five books and multiple courses designed to teach agents her Sell with Soul philosophy that centers on four interrelated principles: Respect, Competence, Confidence and Enthusiasm.  Her first book Sell with Soul is available in the VanEd bookstore. Her new book, Prospect with Soul for Real Estate Agents can be found online at www.sellwithsoul.com.