IMHO it's the cost of doing business. If it isn't one thing, it's another. And if I won't drive the buyers around, there's another agent out there who will. I'd rather spend the $300 and make the $3000 than not. (Our averages are around yours, it seems.) What really bites me, is when I drive someone around, and then they decide not to buy after all, and I'm out the $300 without making the $3000. Even with a buyer's rep agreement in place, you can't force them to buy something, after all!  

One thing we have done is insist buyers are preappoved before we start showing them homes. This helps weed out those that are not that serious about buying right now. We do this in a nice way saying, "Lenders have made so many changes lately, let's be sure what numbers we are working with so we can show you just those homes that you'll be able to finance."  We never mention the cost of out fuel. We have always had an attitude of "I don't need your money, however, I will earn it before we are finished."

I have found that most buyers I deal with so far are well qualified my guess is the b/c credit market is all but gone now.

I been getting bank letters of qualification of mortgage and when the deal is done it is are passed off to Fannie Mae etc and the banks in turn service them.

I also have been seeing a ton of Nehemiah contracts wanting sellers to pay a % of closing cost and % for down payment, we are getting back to square one again 100% financing,  no money down, isn't that what got us were we are at now? just pack it all into

the price of the home and hope it flies.

Well at any rate I switch over mostly commercial, that market is starting to soften up a bit to.

Since I spend thousands of $$$ attracting clients, I don’t mind initially investing an hour driving them around to view properties, after I have softly qualified them on the phone.  Like any other business; Ya’ gotta spend it, to make it.

I can use that drive-time to learn more about them, their needs and their true sense of urgency to sell their home and/or buy another.  

And they get to learn more about me to see if “we” are a good fit.

If I discover that they really don’t intend to buy for many months/years and are not ready to settle on a Realtor yet, I have decisions to make.  Hopefully, I can switch them over to “Virtual Phil”, who will gladly and personally answer questions, and send them additional information on listings that they find using my website’s MLS connection.

But I consider the hour spent behind the wheel a good investment.

Phil Anderson

Broker/Owner

New Portland Home

www.newportlandhome.com

I agree that the gas is the cost of doing business. It just costs a bit more now to make a bit less (or a lot). Of course, be sure that your client is pre-qualified and I always try to talk to the lender before we hit the pavement to make sure we're looking for the right kind of home for the loan.

I find that with rising gas prices, I get more face time with buyers because they don't want to follow me. They want to save their own gas.

I don't drive my clients around. I have them follow me in their cars. And since my "little" car does around 30 - 32 miles/gallon and theirs usually does a lot less, they are going to see it first hand what is the cost of "looking" and won't waste my or their time and money unless they are serious :-).

I favor giving my new buyer prospects a set of up front choice.  My real objective is to smoke out thier "true intentions - price, timing, sincerity, etc".  Thier choices are:  first, we can ride all afternoon, for 42 cents per mile in my large car, or for free traveling in thier vehicle.  Secondly, they may ride for free, after they get a mortgage committment letter and sign my buyers acency agreement.  Thirdly, they may follow driving in thier own vehicle.  The choice makes no matter to me.  The choices filter the serious from the curious quickly, and permits me a solid chance to land a double, which is a new BUYER who has to also SELL!!

Agreed...it's just a cost of doing business.

I've found that if I'm will to show some people 100 houses, they're willing to look at them (particularly if I'm driving). In the end, not only does it waste my gas but it confuses the heck out of them and you run a good chance of losing the gas and the client to boot.

Spend an extra hour at the office and REALLY qualify what the clients are looking for (wants vs. needs/reality) - pool, jacuzzi, location, bedrooms etc. Then go through and show them only the top homes in their budget and wish list. By short listing you should be able to waste less of their time and your time and gas, as well as getting them the best deal.

Charging up front is crazy. Just work smarter and cut your cost in half to account for the extra gas pinch.

Also, get them on the phone with a mortgage broker while they are at the office and get that pre-approval or have them call their bank manager and fax over the proof of funds before you start driving.

I am so proud of most of you that said exactly what we need to say - if you cannot handle the cost of running the business then you do not need to be in the business.   There are so many other ways to Lead Generate at a cost effective rate.   You can cut out "dinner out" once a week or many other methods to make this work.  In this era of virtual tours and internet technology and the ability to research areas, so much of the homework can be handled online before you put you buyers in the car.   A smart agent is not going to show tons of homes, but do a "great buyer consult" and zoom in on what the buyer needs.  Most buyers are very understanding of gas prices and believe me they want to maximize their time also.  Make that a part of your buyer consult.   Are you doing a buyer consult?  That's a good question for all of you?

Paula, why "most"?   Why are you not proud of "ALL" of you that said exactly what we need to say..?

And I'm not skipping "dinner out" ever!  My cooking has injured too many and the judge insisted that I continue to refrain from cooking at home.  It's kinda an "or else" situation.  :)

[John sez: Without discussing commissions, can you tell me how you or your office is handling it?]

I don't even think about such things.  :)

Our area is a resort area. We've had 'lookies' since time immemorial and will have them after the apocalypse when only cockroaches and Cher will remain.

Buyers get qualified, familiarize themselves with the area and scout out the most worthy of touring properties prior to the showing.

They are gonna have to live here. So they can find the neighborhoods they like best.

After that happens, we'll see the ones they want to see. My ride, my time, my gas and/or they can follow.

I do not let clients drive me with rare exception. Me Tarzan!

[Paula sez: Are you doing a buyer consult?  That's a good question for all of you?]

Perhaps you should post on that topic. It's a good one.

I don't mind driving Buyers.  However.....when they start getting toward the limits of my area (about 1 hour's drive just to get there.  Longer in the summer) and decide they want to drive around all day, for two consecutive days, they can follow.  I'm not a tour guide.

I may have lost a recent Buyer because of this.  But after showing 20-something homes in two days with two hours of commute time alone,  and THEN they want to go even further out?  And why couldn't I squeeze more in? I'll refer you.  

Yes, they were quite qualified, and I showed them a variety of homes within their price range, all of which met their criteria.  But I just couldn't satisfy them.  I don't mind cutting my losses on this one.  I'd love to get paid for my gas, time and effort, but that's just not the nature of this beast!

Too bad, too, because I really liked them.  Very nice people.  And I thought we were on the same page.  Alas!

Sorry Gumbaness, Me Tarzan!

http://www.youtube.com/watch?v=MwHWbsvgQUE

You Jane Gumbaness

"My motto is what ever it takes" to make buyers and sellers happy, just think when the market was booming we spent less for gas but drove a whole lot more miles then we do today, hummm So Jane, me thinks ,, I guess everything is relevant then cost wise ?  kabish! :)

Chef, Phil makes some great Swedish meat Balls see for yourselves

http://www.youtube.com/watch?v=LcufmQqovUQ

Cathy said: "I'm not a tour guide."

Well, there goes my summer vacation plan ;-) I was really looking forward to it too Cathy!

[Tarzan Gumba sez: when the market was booming we spent less for gas but drove a whole lot more miles then we do today]

We handle lookies the same in ALL cycles of the RE market. :)

BadaJane

Well, Bill, for YOU, I'll make an exception!

John, I think everyone is right.

I ask if they have been pre-approved?  If not I take them around the corner and let Marina or Minerva get them pre-approved.

If they refuse to work on their financing or are not pre-approved from somewhere else, I refer them to my major competitor in the area.

Let her waste her time with non-committal people.

I am not a "Show and Go" agent.  I sell homes.

The price of gas is not much of a thought.  The time committment is more important to me.

BadaJane says:

We handle lookies the same in ALL cycles of the RE market. :)

"Exactly" BadaJane

T. Arzan Realty

We go the the extra vine... every once and awhile we miss one. Ouch

Because I focus on buyers much more than sellers, I have tried to work extensively on "loyalty and commitment" with my buyers.

On my initial pre-screen phone call, I find out if they are pre-approved and if not, I give them the names of 4 lenders I enjoy doing business with, if they don't already have someone in mind.  I am also willing to do an initial consultation, while waiting to hear on their approval. (If they choose not to get pre-approved, I move on...my time and money are valuable and I only work with "serious" buyers).

I have a very extensive "Buyer's Consultation Session" that can last anywhere from 1 1/2 to 3 hours - depending on how long they want to talk. I have one full page that takes about 20 minutes to discuss me, how I work, and what I expect in return from my buyers. Then I have another 35 questions that I go over to find out about them and their needs...and I also cover the entire buying process, financing, and escrow.

At the end, I have them sign our Buyer's Advisory, the Agency Disclosure, and the Buyer-Broker Agreement. I also request an up front retainer fee. The fee is small at $100 - $150 (as I do specialize in First Time Homebuyers and find that a lot of them don't have a lot of money to put down up front). The fee is also credited to them at time of closing.

I have not found a problem with this and after I go through everything, they have no problem paying the fee, as they see how much work I have already done and plan to do - BEFORE they ever get into my car. (I also do a tremendous amount of previewing for my buyers, as I consider their time is valuable).

If it's a case where I know they really don't have any extra funds, I will waive the fee, and just ask that they sign the agreement. If they are not willing to sign, it's not a buyer I want to work with anyway, as they don't understand "loyalty and commitment."

I also have been doing this all along and not just when gas prices got higher. I find it interesting that we would never think of taking a listing without these agreements, but don't require the same for buyers.

I love what I do...but the bottom line is...it's a business...and I run it as such.

OMG Candice! "...after the apocalypse when only cockroaches and Cher will remain."

I have never laughed so hard!

Who do you think will live longer: Cher or the cockroaches?

LOL Gumba! Aaaa-eeee-aaaaa-eeeeee-ouch!

Chantal, I think Cher will outlast the roaches.  ;)

Well I decided just like a cell phone I never wanted fuel to be an issue. I bought a smart car Im getting 31 MPG intown. Most of my buyer drive there own cars anyway . Those who want me to cart them all over there maybe additional cost to them. The other option is get a portabel GPS and sit in the back seat let them drive. Sounds silly but those with kids want to have the kids in the car but they also want to talk with you about the homes and tour. Just a thought

Alison Creamer

REMAX Allegiance Virginia Beach