How Real Estate Agents Can Explain Rising Interest Rates
A question we are hearing a lot from our clients lately is, “how can real estate agents explain rising interest rates to clients?” With rates increasing, this is an objection that you are going hear more and more often. Although it might seem like this would be a difficult objection to overcome, at the end of the day, it’s not much different from other objections that agents deal with on a regular basis.
Background: How Real Estate Agents Can Explain Rising Interest Rates
Conventional “wisdom” in real estate will tell you that rising interest rates make buying or selling a home more difficult. From a home buyer’s perspective, as mortgage rates increase, affordability typically decreases. However, it’s important to realize (and to educate your clients and leads on) that current rates are still lower than they have been historically. Rates in the 2000s have typically been the lowest they’ve been in history.
So it’s perfectly possible to buy and sell homes with rates hovering around 7%. It’s also important to educate your clients that their rate ultimately comes down to their lender. Mortgage lenders have different types of products and will work with you to find a solution.
But before you do any of that, you have to cover the basics with your lead.
How Real Estate Agents Can Explain Rising Interest Rates: What Not to Do
When it comes to how real estate agents can explain rising interest rates, there are certain things that you never want to do. As with any objection, you don’t want to:
- Disagree with the lead
- Make the lead wrong
- Educate the lead before understanding them
- Try to close immediately
At the end of the day, you have to listen to what the lead is saying and process what they tell you. For example, don’t make them wrong and avoid using the word “why”. Instead of asking, “why do you think rising interest rates are a problem?”, say “what about higher interest rates do you think is a problem?”
Listen closely to what they have to say, understand it, respond to it, and then go into educating them on the situation. The important thing is to build on what they say and have a natural conversation; don’t just nod and then go into what you wanted to talk about anyway.
Here’s What You Should Do
When you’re thinking about how real estate agents can explain rising interest rates, you want to follow the same formula that you would use for any other real estate objection.
- Get the lead’s perspective
- Get the lead’s experience
- Tell the lead the benefit of moving forward now
- Educate the lead after understanding their perspective
- Identify motivation and ability
- Set a logical next step
Here’s how to cover all of these points and overcome this tough real estate objection:
Ask
- When you say rising interest rates…what do you mean?
- Do you know that lenders will work with you to determine your rate?
- What will waiting for interest rates to change do for you?
- What if a change doesn’t happen?
Tie the Lead to a Logical Next Step
- When will you talk next?
- Why will you talk next?
- What will they get out of it?
When it comes to how real estate agents can explain rising interest rates, a key part of overcoming this objection is getting the lead to commit to a logical next step. And be specific. Don’t just say “give me a call when you are ready to move.” Tie them to something that they want to talk to you about. Focus on the benefit they will receive from meeting with you at that time.
If you want more information for overcoming this real estate objection and all other objections, then our Conversion University program is for you and your team! See all of our training programs here.