4 Top Real Estate Markets for Foreign Buyers

By Jerry Kronenberg - 11/07/12 - 8:00 AM EST

BOSTON (TheStreet) -- Wealthy foreigners from around the globe are taking advantage of America's housing bust to snap up U.S. properties at cut-rate prices -- helping the market rebound in the process.

"We've seen foreign investors buy $10 million to $20 million worth of houses in a single trip," says Peter Loewy, CEO of Los Angeles-based Teles Properties. "They think this is a good place to park money, and it's less expensive than the real estate back home."

A recent National Association of Realtors study estimated that foreigners and immigrants who've lived here less than two years spent $82.5 billion on U.S. homes in the 12 months ended March 31. That's about 9% of the total paid for all U.S. housing purchases during the period.

The NAR also found that foreigners spent more on average -- $400,000 per property vs. $252,000 for the overall market -- and paid cash for homes 62% of the time instead of taking out mortgages.

"Foreigners have been a good source of sales, and they're providing both stability in the market and some tendency toward a more normal price appreciation," report co-author Jed Smith says.

Smith and his colleagues say foreigners and recent immigrants are diving into U.S. real estate because buyers consider housing here a good investment and see America as a safe haven for assets.

Many also need a place here for business trips, vacations or retirement or expect their children to study at U.S. colleges and need housing.

Additionally, some foreigners buy property in conjunction with buying U.S. businesses. That's because anyone who invests $1 million in a U.S. company and creates 10 jobs can qualify for an "EB-5" visa and eventual citizenship. (The requirement drops to $500,000 if you invest in a depressed U.S. locale.)

Texas Realtor Alston Boyd says lots of wealthy Mexicans are using the EB-5 program to relocate their families from crime-ridden areas south of the border.

"It's mostly driven by people wanting safety for themselves and their families, particularly in areas where there's a danger of kidnapping," says Boyd, who leads the Texas Association of Realtors' international-sales committee.

In fact, the NAR found that Mexicans accounted for 8% of all sales to foreigners and recent immigrants during the 12-month period studied.

Other top sources for foreign buyers included Canada (24% of all sales to non-U.S. nationals), China (11%), India (6%) and Britain (6%).

Buyers from different countries favor different parts of America.

For instance, the NAR found that lots of Germans have bought property in southwest Florida, while many Canadians gravitate toward Arizona.

Researchers attribute the variations to a given locale's closeness to a buyer's home country, coupled with word-of-mouth recommendations among buyers from the same nation.

Here's a look at the four states the NAR found are most popular with foreign and recent-immigrant buyers. All percentages refer to home sales made during the 12 months ended March 31.

Arizona
Foreigners and recent immigrants account for 7% of all Arizona home purchases, with Canadian vacation- and retirement-home buyers leading the way.

"We see Canadians come here just to get away from the cold weather," says Jodi Kevern of Arizona Focus Realty, which specializes in working with buyers from the Great White North.

Kevern says buyers from Canada's western provinces flock to Arizona because the state has a mild climate, lower prices than the West Coast and a location just 2.5 hours from Alberta by plane.

She considers the Canadians a godsend for the Grand Canyon State -- and for her own neighborhood, where they've turned several run-down, foreclosed properties into well-maintained vacation homes.

"The houses may be still vacant for much of the year, but at least they're taken care of instead of having weeds 5 feet high," Kevern says. "It's boosting all of our property values."

Texas
Foreign and new-immigrant buyers are buying 7% of all Texas properties sold.

"What we're seeing is a very different kind of Mexican buyer," says real estate broker Alston Boyd, who owns Austin-based Boyd & Boyd. "We used to have so many low-income workers coming north, but now we have wealthy Mexicans buying homes and investment properties."

Boyd says Mexican elites are buying homes in Houston, San Antonio and other Texas locales to avoid crime sweeping some Mexican cities, particularly northern towns near the U.S. border.

"I don't want to completely blacken the name of Mexico, because there are places there that are very safe," he says. "But there are other places that are not safe."

Boyd says the added demand is giving the Lone Star State's housing market a Texas-sized boost.

"Any time you have 7% more investment in any market, that's going to help a great deal," he says. 

California
Property buyers from Australia, China, South Korea, Japan and India are streaming into California, where foreigners account for 11% of all home sales.

"California ends up being kind of the gateway to the United States for the South Pacific," says Sharran Srivatsaa, president of L.A.'s Teles Properties.

He says foreign buyers love the Golden State's climate and Hollywood image -- not to mention recession-reduced home prices far below what foreigners pay back home.

"It's easier to find a $1 million or $2 million property that's a good value in Los Angeles than it is in Melbourne or Sydney," Srivatsaa says.

Many foreign buyers gravitate to famous California communities such as Beverly Hills, Bel Air or Pebble Beach.

But Teles CEO Loewy says some Chinese buyers prefer Alhambra, Pasadena, San Francisco and other areas with large Chinese populations.

"We have a fair number of Chinese neighborhoods where you can walk down the street and see Chinese shops and people reading Chinese-language newspapers," he says. "It gives some Chinese buyersan extra sense of comfort."

Either way, Loewy says foreign buyers are really helping the state's long-struggling housing market rebound.

"Foreigners have to some extent helped the ability of people to 'move up' in the market, and we're starting to see high-end luxury homes really sell way faster," he says.

Florida
Foreign buyers and recent immigrants account for 26% of all Sunshine State home sales -- the largest proportion for any state.

Matey Veissi of Miami's Veissi & Associates says most foreign buyers hail from Latin America or Europe, drawn by Florida's nice climate and close proximity to their homelands, plus America's economic stability.

"Buying a piece of Florida real estate is like opening a savings account for many foreign buyers," she says. "They know they're putting their money some place where they can get it when they need it."

Veissi, who estimates foreign buyers make up about 40% of her business, says clients from different countries seem to favor specific Sunshine State locales.

For instance, she says Brazilian buyers like the nightlife and nice beaches of the Gulf Coast's big cities, while French customers focus on Miami, Sarasota and mid-Florida. (British and Canadian buyers seem happy to move anywhere in the state "just to get away from the cold," Veissi says.)

The Realtor adds that foreigners are definitely helping to pull Florida housing out of the doldrums.

"We've always had international buyers coming in," Veissi says, "but now they're coming in in droves."

Networking Basics: 8 Tips to Networking Without Being Fake

Marie Forleo is one of the Business Guru's I follow regularly on Social Media. She's one of the leading Online Marketing experts who built her business from nothing into a multi-million dollar corporation with just her laptop and a desire to help women around the world live their dreams in building businesses without being chained to a desk. I love her off-the-wall energy, her style, her confidence and I've learned a lot of great things from her. I wanted to share her video today on Networking Basics. Our Business is obviously about who you know, and getting back to basics wouldn't hurt!

10 Ways to Excel in Today's Economy

Last Thursday, the LA County Ticor Title team had a sales meeting over Italian food.We discussed the usual - what's going on in today's Real Estate Market, what's coming next in the Economy, effective tools we have, how to continually build our business and running the Sales numbers for all the Title Representatives. While we sat and enjoyed the Chardonnay, I began to reflect on my last 6 years in the Title Business. All the extreme highs & gruesome down's from 2008+, although I wouldn't take a second of that experience away because it has engrained some deep values I'll take to the end of my career.

My manager took some time recognizing our accomplishments, with me ranking in the top 3 among 30 sales reps and how I've continued to double my sales for the last 3 years. I realized at this point, it couldn't be simple luck and it got me really pondering about all the Clients and Friends I've encountered and what it has taken some to achieve astonishingly grand results in today's economy versus those that have not done so well (in all fields, not just in Real Estate). The Question is: What does it take to make it in today's economy?

I decided to compose a list of 10 Ways to Excel in Today's Economy from all the lesson's I've learned from successful people, the dozen of Motivational/Life/Sales seminars I've attended, the thousands of people I've come across in the past 6 years, the many books I've read and the Life lesson's I've accumulated thus far. I've got a humbling long ways still to go but I thought I could share what I do have. If I can even help 1 person, my efforts spent would be well worth it.


1. Attitude. How often have we heard that 10% is what happens and 90% is how you react to it? Keeping a positive attitude for yourself is not only good for your mental health, but your physical health will reflect upon that. And the harsh truth is that most people don't care to be around downers nor do they care about your excuses. People already know how bad the world & economy's perceived to be just by turning on the TV or Newspaper. Psychologists have shown that people default to negativity as a safety net. The fear to fail is so great that if they don't set high standards, they won't end up disappointing themselves. It is a daily struggle to fight beyond that negative urge but once you get there, it's a darn Great feeling to wake up every morning.

Being around dozens of people daily, I can easily spot the Professionals that are achieving greatness in business and in life, without knowing their numbers. It's the ones that choose to look at the brighter side, to continue hustling beyond traditional measures, those that see the glass half-full than the other way around. In 2008, while dozens were getting laid off by the masses and dropping out of the business, I had majority of people telling me that I should leave too, that the Real Estate market would crash and the title business would never be "the way it was". (And while that may be true, nothing in life is ever static.) A small percentage of people, however, enthusiastically shouted words of encouragement "Stick to it, work hard now and you'll come out on top when the economy turns around. I guarantee it!" For some odd reason, I chose to listen to those positive words, I wanted to believe what they were saying, despite having months where I was barely making enough to pay for gas. I thank all those that had hope, that kept going despite the negative surroundings because their forecast was right.

“The longer I live, the more I realize the impact of attitude on life. Attitude, to me, is more important than facts. It is more important than the past, the education, the money, than circumstances, than failure, than successes, than what other people think or say or do. It is more important than appearance, giftedness or skill. It will make or break a company... a church... a home. The remarkable thing is we have a choice everyday regarding the attitude we will embrace for that day. We cannot change our past... we cannot change the fact that people will act in a certain way. We cannot change the inevitable. The only thing we can do is play on the one string we have, and that is our attitude. I am convinced that life is 10% what happens to me and 90% of how I react to it. And so it is with you... we are in charge of our Attitudes.” Charles Swindoll

2.  Set High Goals. Visualize. I always write a new years resolution list for all my goals. It's important to make 1 year, 5 year, 10 year goals. In my opinion, To-Do lists DO work. Having monthly goals, weekly goals, all the way down to daily goals. How many Prospects do you want to approach this week? How many Referrals will you ask for? When we have things we know we have to get done, we tend to revolve our schedules around achieving it. Imagine the times when you know you have to meet a friend for dinner at 7pm, you know you have to get everything done by then to do so. What if that was your sales goal you had to reach? If goal's aren't written down and with no deadline, then it can easily be put off (same as losing weight).

Visualize: So often, we set step-by-step goals for ourselves, but we forget to look at the bigger picture. Meditate once in awhile, and envision that clear picture of what you would look like, what you would be doing, where you would be if you have "MADE IT". Imagine what it would look like after the rain, after the hectic climb to the very top of the mountain, and you're sitting at the peak enjoying a beer looking out at the view.

Set an income goal yearly. Set a goal that's a bit of a far reach, but do-able, and a minimum income goal. If you set too high of a goal with no minimum goal, halfway through the year, if you're no where close to the goal you may just give up. Giving yourself a more practical minimum goal will at least keep you on track. 


3. Believe in Yourself & Stop Making Excuses. We can list hundreds of reasons why we can't make money now. The economy's crap, the real estate market is still struggling, the banks won't lend, there's no inventory in the market. What's the Story you tell yourself? Stop playing the victim and put yourself in the driver seat of your own life! Think of those in your market that are making more money today than 7 years ago. What are they doing right?

When I first started, I'll admit that my fear told the story that I was too young to make it. A few told me that it may be hard to get business in a pre-dominantly non-Asian market. I thought it's a Man's World, it's tougher to be a female in this world, let alone in Corporate America. How many of you have had similar badgering stories of yourself? Somewhere, somehow, I warded off all those lame excuses. I took all those stories and turned it around to my advantage. My new story was that because I'm young, I learn faster, I'm innovative, I'm quicker with technology, people like young motivated energy. I realized being Asian and Diverse, I am able to connect to a wider-range of people. Being bilingual helps, and having the Asian culture engrained while being born American gets me an advantage to connect with people of different backgrounds. And lastly, being a female in America is a better place to be than anywhere else. It can work totally to your advantage if you know how to present yourself with confidence and respect. Act like a Lady & Think like a Boss.


4. Take care of Yourself First. In Sales or any other profession, the first impression is so vital, and it  revolves around how you present yourself. Take care of your inner-self through eating healthier, exercising and meditating. Take an hour before work, during lunch hour or after work to unwind at the gym, go for a run, be outside for fresh air, or attend a Yoga class. When you're feeling good inside, you will shine on the outside and people around you feel it too.


5. Give Back to the Community. Statistics have shown that people who give more tend to have higher happiness levels. Think of a time you've lend a helping hand to a friend, bought a meal for a homeless individual, volunteered at a shelter, wrote a check to your Charity. When you're happier, you will perform better at work. You put away the self-pity and the negativity that surrounds. And when you broaden your perspective outside of your little bubble and realize that  by the mere fact you're living in America, you're better off than 95% of the rest of the world, you'll wake up each morning appreciating life more.


6. Continually Network & Don't burn bridges. The word networking brings many people to think of the typical networking parties that happen around town. While those are great, there are ways to network constantly that may be less hectic. Constantly keep an ear out of what your friends are doing and what they need, keep that in your memory bank for any open opportunities to connect them (even if it doesn't benefit you or is outside of your field). That's part of giving back, Karma will come around when it's your turn to be given awesome opportunities. It's about who you know, not what you know.

While there are times some people can be real a-holes (yes you can imagine I have encountered a few), I try to keep my cool and to not burn bridges. There are times though when your dignity is on the line, and you should definitely speak out. But for the most part, people are doing what they know the best that they can. Stay cool, you never know what they're going through inside and when you may need them later.

Books: Never Eat Alone, Keith Ferrazi. How to Win Friends & Influence People, Dale Carnegie. 

7. Stay updated with Technology & the Latest News. You may not have jumped on the facebook/twitter/linkedin bandwagon as it may not be your cup of tea, but it wouldn't hurt to have some online presence, and know how to navigate around the web. Keeping up with the latest news and laws is vital as your clients rely on you (the expert) to deliver.

Books: Life by Design, Tom Ferry.

8. Put Yourself in the Seat of the Consumer. In the customer service business, your job is to make your clients job easier. It's relationship-driven, a two-way street. They chose to pay for your services over others for a reason. People prefer to have a go-to person for each of their needs whether it be Accountant, Dentist, Print shop, Car Dealership, etc. It makes their life easier to do business with someone they trust and don't have to think twice that you'll deliver the best. 


9. Surround Yourself with People that Do Better than You. This can mean one of 2 things. 
1) Find a mentor. Someone working in your same field (perhaps in the same company) that does significantly better than  you and offer to take them to lunch to pick their brain. Ask them to be your mentor, most of the time, people do want to help (as long as you're not a threat to them!). Take classes, read books from those that have achieved what you wish to achieve. 
2) Surround yourself around friends or groups that are at your success level or higher. This is not to say to drop your friends who are making less. Everyone has their own specialty. Make a mental note of what you want to learn from each person around so you are aware of where you wish to be influenced. Having people around that are more successful than you will raise your standards higher, naturally. (Survival of the fittest / adjusting to our surrounding) You will share ideas with one another and challenge each other.


10. Find your Brand & Niche. How many times have we heard of this? Especially in the last decade. While hard work will always be the underlying cause that leads to success, it's all about standing out today. Just getting your work done will be seen as 'mediocre' instead of 'greatness'. What is your Brand? How do you Stand out? What can YOU offer in the market you're working? What are a few key words people think of when they hear your name? Continue to stay in front of your prospects/clients, "out of sight, out of mind." Whether it's seeing them regularly, or making sure you have a consistent Marketing Campaign. Invest in yourself, and Invest in your Brand.

Niche: A specialty in which a person or business operates. In other words, your target market. While whatever we're selling, we wish to maximize our target market as volume equals more, it's still important to identify what your specialty market is. Who are the types of people that you get along with most? Who could utilize your service most? Have special marketing efforts towards that Niche and you will see an increased outcome!

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I hope this helped and I welcome you to leave input on other ways to Excel in this market!

Mortgage Updates

Chase

·         As part of the $25 billion mortgage settlement that was struck between the country's five largest banks and the state attorneys general and federal government, JPMorgan Chase pledged more than $4 billion in mortgage relief for thousands of borrowers by either reducing the principal owed or the interest rate or both on their loans.

·         Chase now reworks the loan terms and lays out the new payment plan in a letter to its borrowers.

·         The borrower sees the new rate, how much principal has been taken off their balance and what their new payments will be, and all they have to do is sign the letter approving the new terms and mail it back to the bank.

·         In modifying mortgages it already owns, Chase does not need to verify the borrower's income, assets and work history.

Housing

·         Although home prices gains were the highest in six years during the first half of the year, a full-on recovery is still not in sight.

·         Higher prices can be attributed to low inventories, with the resale supply at an eight-year low and new-home inventories at a nearly five-decade low.

·         The market currently is resting on investors and first-time buyers given that many homeowners cannot trade up because they are underwater or have lost too much equity.

Short-Sale Program

·         Underwater homeowners who participate in the Fannie Mae and Freddie Mac short-sale program this year are unlikely to get a break on their credit scores.

·         Short sales typically cause FICO scores to plummet, sometimes 150 points or more.

·         Homeowners who qualify for the program must have solid mortgage payment histories.

·         But the credit score companies do not plan to make any changes to their scoring systems for these borrowers, who will be fundamentally different from sellers who did not pay their mortgage for months on end.

Loan Mods

·         America's highest-ranked residential servicers completed 66,000 proprietary loan workouts in July, 40% more than a month earlier.

·         The alliance represents more than 30 servicers -- including the top five, which agreed to a $25 billion nationwide settlement to improve modification efforts and provide principal reductions when possible.

·         The sudden spike in proprietary modifications may reflect the impact of that accord.

Mortgage Debt Relief

·         A special exemption of up to $2 million per household in principal reduction and other breaks provided by the Mortgage Forgiveness Debt Relief Act of 2007 are set to expire in December.

·         Homeowners receiving the aid as part of a national foreclosure settlement could face hefty tax bills as a result.

Goldman Sachs

·         A federal appeals court in New York has ruled that NECA-IBEW Health & Welfare Fund can pursue a class-action case that accusesGoldman Sachs Group of deceiving investors about the risks associated with mortgage securities offerings.

·         The decision could potentially expose banks to a wider array of claims by letting mortgage securities investors sue over securities in which they did not specifically invest themselves.

GSE Reform

·         Mitt Romney said he will make reform of Fannie Mae and Freddie Mac a priority if elected.

·         He blamed the companies for the financial crisis but did not offer specific details for an overhaul.

·         Republicans remain deeply split on the issue, with conservatives leaning toward full privatization of the firms.

Trulia

·         Real estate search and marketing portal Trulia has launched a tool that offers preliminary rate and fee quotes from mortgage lenders when consumers key in information such as credit score, home price, down payment and property type.

·         Trulia Mortgage Center directs them to a page with a lead form for the lender along with details of the loan, including estimated monthly costs.

CWCapital Sale

·         Walker & Dunlop has completed its $234 million acquisition of CWCapital, making it one of the largest commercial real estate lenders in the U.S.

·         The company’s Chairman and CEO said he expects CWCapital to add substantially to his firm's platform.

US Construction

·         U.S. construction spending fell 0.9% in July from the month before, the largest amount in a year.

·         The decline followed three consecutive months of gains driven by increased home and apartment construction.

·         Outlays on single-family homes bumped up 1.5% and spending on apartment construction rose 2.8% percent.

Fannie Mae Loan Mods

·         Fannie Mae completed 11,410 loan workouts under HAMP last month.

·         July marked the third month in a row that the mortgage financier has completed more than 11,000 modifications.

·         Since the first of the year, it has completed 93,413 loan modifications.

Wells Fargo

·         Wells Fargo has reserved $9 million in down-payment assistance for potential home buyers in the Minneapolis-St. Paul, Minn., area.

·         To qualify for the NeighborhoodLIFT initiative, a family of four would have to earn less than $100M a year; participants would be eligible for a $15M grant that may be forgiven if they stay in place for at least five years.

·         Wells Fargo is offering the program in several cities that were hit hard by the foreclosure crisis.

Medical Debt Responsibility Act

·         The Act -- which would require medical collections to be scrubbed from consumer credit reports within 45 days of payment -- could bolster the housing market if passed.

·         Some consumers have been unable to obtain home loans because their credit scores have suffered due to problems with medical debts even after they have been paid.

CFPB Mortgage Reform

·         The Consumer Financial Protection Bureau wants to aggregate title insurance and other closing costs in the annual percentage rate.

·         The resulting increase could affect the number of loans subject to other legal requirements.

·         The CFPB is looking into revising state and federal triggers that impose additional rules on high-cost loans.

Mortgage Employment

·         Second quarter tallied an estimated 4,245 mortgage-related layoffs from April through June.

·         However, hiring’s were greater at 5,580 -- marking the fourth consecutive quarter of mortgage job gains.

·         Michigan's 711 hiring’s and zero layoffs gave it the biggest net gain followed by Florida, New Jersey and Pennsylvania.

Think Forward: Renew Reinvent Reconnect

Staying connected and meeting new contacts is more important than ever in today's time. As the author Thomas Friedman puts it, "The World is Flat"; we are all interconnected, and the more connected you are, the more rapport you build, the better off you'll be.


It's a great time to get involved with the community and Real Estate Associations, one that I've actively been involved with is AREAA (areaa.org). The Asian Real Estate Assocation of America has been the leading RE organization in the past decade. It started off as an organization to help the American dream of home-ownership setting high standards for the community. With their recent visit in D.C. meeting with Mr. Obama to discuss how to recover the market to international trips to China, Thailand, Vietnam for Trade Missions to meet with the International Investors, AREAA's certainly thinking outside the box and staying ahead of the game.

I encourage you to get involved with your local AREAA Chapter. And they are having their annual convention "Think Forward: Renew Reinvent Reconnect" coming up on September 23-25 at the Bellagio, Vegas (areaa.org/convention). They will cover everything from REOs, Asset Management Roundtable, Commercial Real Estate, Investment, International business opportunities, Social Media and most importantly best networking events/parties I've ever been to! And a special guest appearance from HGTV's Property brothers at the Keynote Luncheon!


Why are we having the convention in Vegas this year?




I have volunteered with AREAA on a local level in helping them promote their events (AREAA LA/Tri-County), representing as an AREAA Edge Ambassador (the Young Network Professional Network) and now am bringing awareness through Media as the AREAA National On-screen Reporter. Find out why RE professionals are involved at my AREAA News Network channel (youtube.com/areaanewsnetwork).


Here's a Recap from last year's Convention:

Jacki's Title Updates

Hello My valued Clients & Friends!

As your dedicated Title Rep, my job began as another Account Executive job in 2006, to bring you the fastest quality Preliminary Title Report, the Farm packages, Property Profiles, Plat Maps, Accommodations and to insure that your client's property will be free & clear of liens.

While I guarantee that Ticor Title provides the best service in those fundamental Title needs, I have learned that to accelerate in this market, you need to offer a whole lot more. As a Title Rep, a Realtor, a Commercial Broker, a Developer, a Banker, Escrow Officer, in any business, simply doing your job is not enough. Being "good" isn't enough, you now need to be Outstanding. It is about finding your true Brand, identifying your Niche, aiming high goals, continually think outside the Box and constantly re-inventing yourself. I have grown my business approximately by 40% every year since the economy-crisis in 2008. This year, I'm on my way to doubling my income. There is no coincidence or luck, only working smart and creative. And of course, some play at the end of the day to reward yourself.

I decided to start this blog as a Go-To spot for all the latest Real Estate Updates! I will include an archive of E-newsletters I send out, everything Title Insurance, Explanations of Real Estate/Escrow terms, Fraud updates, Real Estate Seminars/Conventions/Networking Events going on in the area, the latest news and more! Feel free to leave comments on what you'd like to see more of as I'd love to make this blog as interactive as possible. I am grateful for all your continued support and trust. Let's finish 2012 up strong!!

"Attitude drives Actions. Actions drives Results. Results drive Lifestyles."

Is Integrity a Sales Strategy?

Is Integrity a Sales Strategy?
by Dave Kahle


I was speaking to a group of professional sales people in Johannesburg, South Africa, on the subject of integrity in business. At dinner later in the evening, my host, who had been sitting in the audience, sheepishly shared with me that several of the people seated near her snickered at the idea.

Evidently, to them, sales was just a series of transactions, and the sales person's job was to wring as much money out of each transaction as possible, under whatever means were necessary.

Their position was, I believe, both sad, as well as unwise. I believe that there are certainly practices in the business world where morality perfectly coincides with wise business. Integrity is one such practice. It is both good business, as well as good morals.

I believe it is such good business that sales people should adhere to a no-exceptions policy of maintaining absolute integrity. I'm not going to make the case for absolute honesty as a moral policy. That's better left to our churches to do. There is, however, a powerful case to be made for honesty from a practical point of view.

Honesty is a powerful sales strategy that is probably more important today than ever before.

It works like this. If you have integrity, you conserve your customer time. In today's frenzied world, time is more precious than money for a lot of people. If your customers cannot believe you, then they must use hours, days or weeks of precious time confirming the representations you have made. If, however, they can believe you, then they don't feel the need to check for the veracity of every fact or statement.

Here's an illustration. A few years ago, we attempted to purchase a condominium. The condo was in a resort location, and had been used as a rental unit. So it came fully furnished, down to the silverware and cooking utensils. We thought it was a good value, a wise investment, and offered the owner exactly his asking price. Shortly thereafter, word came from the real estate agent that the owner, on receiving our full price offer, had increased his price.

The owner may have been looking at his action as a slick negotiating ploy. We saw it as a lack of integrity. If we couldn't believe his stated price, then we couldn't believe any of the representations he had made. We would be reduced to counting the number of spoons and forks instead of believing the inventory sheet provided for us. We didn't want to waste the time checking out every aspect of the deal. If we couldn't trust some of the representations by the owner, then we couldn't trust any. And, if we couldn't trust any, it wasn't worth it to us to take the risk in dealing with him. We walked away from the deal.

We saw the owner's lack of integrity as causing us to invest a great deal of time to assure ourselves that the risk was worth the money.

In this case, we were the buyers who saw the seller's lack of integrity as causing us to use more time on the project. We chose not to do that.

The same is true of your customers. The more your customer trusts you, the less risk your customer feels in dealing with you, and the less time necessary to invest in understanding the product, service or program you are offering. From the customer's perspective, it's easier and less risky to deal with someone you trust than with someone you don't trust.

And that can translate directly into dollars. I'm always willing to pay more for something if I can buy it with less risk. In other words, if I can buy it from a company or person I can trust. On the other hand, I'd rather not buy something at all if I have suspicious feelings about the vendor.

Here's another example. A few years ago I grew jealous of my neighbor's lawn. His was far greener, thicker and fuller than my lawn. It was because he had a lawn care service fertilize his lawn several times each year. I determined to do the same thing. So I obtained the name and phone number of the company he used, formed an idea of what the service would cost me, and decided to do business with that company.

I called the company, ready to buy the service. When I inquired about the types of service available, the sales person indicated that there were several options available. Now, I'm a visually oriented person, and I like to make decisions based on what I read, not on what I hear. So, I said, "OK, why not come out and do the first application, and leave me a brochure so that I can review my options, and then I'll make a decision." The sales person agreed.

We then reviewed the details of my location, and the approximate date for the first fertilizer application. It was a deal. The sales person then repeated our agreement, saying, "OK, we'll be out to do the first application and we'll leave a brochure, and then you can cancel at any time with 30 days notice."

"What?" I said.

He repeated his comment. "Wait a minute," I said. "I only agreed to one application. I'm not committing to any ongoing contract until I check out all the options."

"But that's not how we do it," the sales person stammered.

"No," I said.

"But, but..." more stammers.

"NO." I said again. "Forget it. Cancel me."

What happened? Here I was, as good a prospect as there ever was. I was ready to purchase, having decided to use this company, even calling them to make the purchase. Yet something in what the sales person said raised a red flag in my mind, and made me doubt the integrity of the person, and by inference, the company. He had originally said that I would be billed for only one application, and then implied that I was committing to an ongoing program.

I viewed that as being deceitful, or at best manipulative. If I can't trust them on that, on what can I trust them? There are lots of other lawn care companies, and the next one in the yellow pages got my business.

Life's too short, and business is too busy to deal with people you can't trust. The question, then, for you as a sales person is this:Do your customers see you as trustworthy?

That's a difficult question to answer. You can't just ask them, because you know you are unlikely to hear a candid response. But you can gain a sense of their perception of you by looking for some of the symptoms of trust or a lack of it.

For example, if you find your customers sometimes buying from a higher priced source, or buying a product or service you consider to be inferior, it may be that your customer doesn't trust you!

On the other hand, if you find your customers accepting your word, and choosing to deal with you, even when you are offering an identical product at a higher price, then chances are they do trust you. Your reputation for honesty and integrity has been a smart business strategy, resulting in measurable benefits to you.

Unfortunately, a reputation for trustworthiness and honesty is not an outcome of one event or a single transaction. It doesn't develop out of some clever phrases you memorize and repeat. Rather, it develops over time as you adhere to a set of ethical standards in small as well as big things. It's not a technique you use, but rather it's the person you chose to become. As you strive to adhere to the standard of absolute honesty and integrity in all that you do, you'll develop a character trait that will become evident to everyone around you, including your customers. And that is good business as well as good morals.