BUILDER bloggers Myers Barnes and Mollie Elkman hosted a two-day sales and marketing seminar for home building professionals last week in Philadelphia.
BUILDER bloggers Myers Barnes and Mollie Elkman hosted a two-day sales and marketing seminar for home building professionals last week in Philadelphia.

One of the most difficult things for a new home salesperson is pre-sales, where houses are being sold long before streets are complete and models are built. Generating revenues and profits before a neighborhood even exists can be daunting to even the most seasoned sales pro.

Marketing expert Mollie Elkman of Group Two Advertising and I met with sales and marketing managers from across the country last week at our first annual New Home University. Strategies for pre-selling were a top concern among these home building executives. Here are a few of the tips we discussed:

--Remember that with pre-sales, you are marketing services, not homes. Pre-selling is not dependent on model homes, finished home-sites, or even paved streets. In most cases, when a prospect buys a pre-sale home, what does he or she get? Just a promise that the developer/builder will deliver the neighborhood and/or home in a specified time frame. The entire pre-sale strategy is based on this promise. You’re selling the guarantee that, at a specified future date, you will deliver their home.... this means what you are really selling is your honesty.

--Differentiate between a house and a home. A house is a physical location, and a home is an emotional experience. When you are helping a customer make their home-buying decision, you need to understand this distinction. It is indeed a tall order of fulfillment, because you are selling a human (who is a bundle of emotions) their high-priced dream.

--Be realistic and prepare for delays. Don’t give out schedules without keeping in mind the vast potential for delays. You are better off giving the customer a longer period of time and then exceeding those expectations.

--At most building companies, pre-selling and launching have one fundamental flaw: They focus too much on the transactional nature of home selling—the process of presenting a home and closing the deal. In following this conventional strategy, you miss a major issue for the buyers: There is nothing for them to buy. When there is nothing to buy, you have to sell the joy of the home, not the price of the house. Deliver the experience and share the magic—and the commitment of quality service and on-time delivery.

--Seeing is believing is more than a phrase. The prospect wants to see something concrete, an array of professional photos, 3D photo-realistic renderings, virtual reality scaled models and high-definition virtual video tours. People hear what they see and will trust their eyes far sooner than they will ever trust your words. 

Bottom line: People don’t make purely rational decisions based on cost per square foot and expected utility, despite what conventional wisdom has led us to believe. Research findings confirm that decisions are driven more by emotions than logical and conscious thinking.

In future blog posts I will provide more details about how to market and sell a community before it opens.