The Marshmallow Test

I am currently reading “The Marshmallow Test”, a book written by Walter Mischel about mastering self-control and how the study of this came about.

In a nutshell, the test was done on elementary school kids and basically offered them a choice of one marshmallow now or to wait for 20 minutes and receive two marshmallows to enjoy thereafter. The book covers the whole study and goes into a lot of detail about what was discovered and how we justify and rationalize our willpower and self-control.

This got me thinking about real estate agents and the marshmallow test: agents are so quick to go for the first marshmallow without having the self-control to wait a little longer and receive two or maybe even more than two. Here is an example:

With the market being so heated, agents are putting properties under offer or sold very quickly without thinking ahead that stocks are going to continue to drop and new listings will be difficult to find. They take their marshmallow now.

BUT….by holding onto that listing and using it as a tool to find new listings, they could end up with more than just one marshmallow. How do we do this? For starters, give the property it’s time to shine and make sure that the sellers do not accept the first offer, but rather the highest and best offer, by collecting offers and creating competition between buyers. This strategy gives you a few extra weeks to meet more buyers and, of course, prospective sellers – you start building contacts and creating more potential listings.

A great way to achieve this is by using the AUCTION method of sale or even using a SALE BY DATE – these give the property a little more airtime instead of banishing it from the market and preventing you and the sellers from exploring your options.

Another way of getting more marshmallows is by simply not putting the property under contract as soon as the offer is made and waiting for the buyer’s finance to come through before removing it from the market. This helps in a few ways, namely giving you an opportunity to meet more buyers and, again sellers, while also making sure the first buyer is put under pressure to get their finance sorted quickly otherwise, they could have another buyer breathing down their neck.

Now that the market has changed, we should be changing with it and making sure we don’t get left behind and only end up with one marshmallow as opposed to many.

For more information on how to get more marshmallows (prospecting, generating listings and building databases) register for my upcoming FREE half-day Real Estate Brilliance webinar and I will give you some simple systems to help you on your way.

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