1. Tyre Kicker

 ~ noun  
“a person who inspects something for sale with no intention of buying.”

The term was coined to describe people who would visit a car sales yard, apparently in search of a new vehicle. They would wander aimlessly through the lot, “kicking the tyres” on a few vehicles, as if that were some kind of roadworthy test, then leave without ever buying. Some may have even enquired further, taken brochures a written quote and even taken a car out for a test drive, never to be seen again. The inexperienced salesperson thinks they’re dealing with a potential customer genuinely interested in purchasing, only to discover they’re a tyre kicker who’s simply never going to buy – at least in the foreseeable future. Although it originated in car dealerships, the term has been adopted across the sales industry, especially real estate, to describe anyone who is indecisive or lacks intent and purpose.

While the above term is very familiar regarding people on the purchase side of a transaction, did you know, the same term applies to people on the sale side? That is; a person who says they want to sell their property, but has no intention of selling anytime soon.

They are also tyre kickers in that they don’t mind wasting the time and efforts of real estate agents. What some people do not appreciate is that agents work for free, until we sell a property. In a booming residential market that can be as little as 24 hours! Yes, that’s definitely easy money for the few agents who manage to sell in such short time periods. But on the flip side, and in ‘normal’ markets, sales take much longer. In the commercial property market, this can blow out to months and even years of effort before securing a sale (or lease). That is years of work for no guaranteed pay day. That’s a tough gig!

One of the most precious things in life is time

As you get older you realise that one of the most precious things in life is time. Anyone who attempts to waste my time is like poison to me. I got this way by spending many years chasing tyre kickers who I thought were the real deal. It was a long hard lesson, but I learned it well and can now spot them a mile away. It’s just that I cannot give them my time as I have to make a living. As a commission only salesperson, there is no option but to identify and cut the tyre kickers fast, which I am happy to say, I have mastered over the past 30 plus years in the game.

From long experience, another unsavoury side to tyre kickers is that they seem to be dishonest (with themselves and others) and also have no respect for other peoples time. On the flip side, those who are slow to recognise time wasters are the opposite. Basically just nice people who are genuinely trying to help a buyer or seller reach the right decision and are often willing to go to extreme lengths to get a deal done for them. I myself have bent over backwards, driven and flown for hours, spent my own money on plans, feasibility studies and advertising. Not to mention the time spent calling and emailing people on the other side of the transaction trying to help close the deal for my prospect (the tyre kicker). I am ashamed to admit that I was probably the slowest person to come to this realisation. It’s hard to believe, but in some cases, I courted buyers and sellers for up to 5 years, believing they would stay loyal to me after all the hard work I’d put in – only to be cast aside at the 11th hour when a good deal came in through another agent. No discussion, no call to offer me a chance to bring them a better deal, just cut out. That was a heartbreaking period in my life. But you know the saying;

What doesn’t kill you, makes you stronger

That hard road has taught me and my agency great resilience. I know I’m here for the long haul and will outlast everyone else through all the up and down cycles. The way we operate now is to be very upfront with complete transparency. Nothing is hidden, no game playing, just honest dealing and a solid process of weeding out the tyre kickers from the genuine buyers/ sellers.

How we avoid tyre kickers

These days we are much wiser and stronger and we always start off any potential dealing by asking the following simple questions. Bear in mind, as licensed real estate agents, by law we must have signed written authority from the property owner to present their property for sale (or lease).

To sellers (or landlords)

Question: We have a prospective buyer (or tenant), but we need the proper authority to introduce them. Queensland, Australia, this is called a Form 6. If I get you the form today, can you sign it today so I can introduce them?

At this point, some owners say; bring them in and if they like it we can talk. There’s several problems with that for real estate agents.

1. Firstly, we must have written legal authority to act on behalf of a property owner. This is the law and we can lose our license for not sticking by this simple rule. Some property owners don’t care about that as it doesn’t affect them. But any reputable and ethical agent will abide by it. So to the owners; if an agent agrees to this, ask yourself if  you are dealing with an ethical agent or someone who is happy to cut corners (and might do the same to you)?
2. Without a pre-arranged  written agreement between owner and agent to specify how much the agent will receive if a client is introduced and a deal is done, it opens a can of worms with potential conflicts. It’s so simple to agree (in writing) up front. problem solved.
3. Without a valid form in place, agents are open to a claim against them if something goes wrong. This could be as simple as a client tripping at the front door and suing the owner – who in turn might sue the agent for, guess what?; bringing them around without proper legal authority! No thanks.
4. Even when we do have a form signed, is it an Open listing or Exclusive? If the former, we have to ensure we don’t give the client details to the owner – and vice versa because they could easily do a deal together and we agents will miss out on being paid for all our hard work, expenses and time.

So when it comes time to ask an owner for written authority, if they hesitate or say no, it means one one of two things;

1. They are not ready or not really interested in selling or leasing their property, just curious about the market rate. We’re happy to have a chat about general market rates, but we can’t waste ours and our clients’ time introducing them to a deal that will never happen. In this case, I’d rather another agent waste their time.
2. They don’t want to commit to paying the agent for their work. Or they want to try to pay a very minimal fee (or nothing at all) after the deal is done. No thanks, we’ll leave that to the inexperienced agents.

What about solicitors letters?

In either case above, we lose interest immediately. People know and expect solicitors to send them a Letter of Engagement which specifies their fees upfront. 

Do you think you could ever say to a lawyer; just take on my case and I’ll fix you up later?

They would laugh you out of their office!

Agents are no different, we need that form up front. Yet many people still think agents should not be paid for making deals happen. It’s unacceptable and just like lawyers, we don’t work for free. 

It’s that simple. All genuine people I have dealt with never hesitate when a genuine deal is in play. This is without exception and a very easy indicator of who is serious and who is a tyre kicker. 

To buyers (or tenants)

Question: The seller/ landlord is very busy and has instructed me not to waste their time with tyre kickers. The price is X and the terms are Y (and for tenants – the deposit is 3 months with 1 month in advance and personal guarantees). If I show you today and you like it, are you willing to sign an offer (or contract) at that price and pay the deposit today?

If there is any hesitation, they are not serious, and we move on. In every successful deal I’ve done, I have learned that nobody hesitates when it’s the right property at the right price. There may be prolonged negotiations, but nothing starts until the legal paperwork is in hand.

Nobody hesitates when it’s the right property at the right price.

Real life examples of tyre kickers

Are you ready for some incredible tales from the coal face of commercial real estate? Buckle up…

• A commercial property owner who I worked with for 4 years to sell his property. Bringing several offers at his agreed price and terms (which he raised higher every time), only to be rejected every time. The property has still not sold. People like this love the buzz and attention from all the agents and buyers, but eventually you have to face the disappointing truth that they are just wasting your time.
• A commercial buyer who I’d known for years, was adamant they did not want to buy in a certain commercial complex. After finally agreeing to come and inspect one of the warehouses I had for sale, which I advised would be perfect for him, he decided yes, the complex had changed for the better and he’d make an offer… soon! I told him not to hesitate as other agents were working on it. He inspected on Thursday and gave me an offer (way too low) on Monday. But it had sold the prior Friday (through another agent) to someone who didn’t hesitate. To rub salt into the wound, the same guy then bought a property in the same complex I had to bend his arm to inspect, from another agent! Tough lesson, but I won’t waste another second on this person now.  
• A leaseholder wanting to sublet part of his large property. We had a genuine lead very keen to sign immediately. But he refused to sign our authority form. We ceased wasting time with him and it sits empty 12 months later. So to avoid paying our modest commission, he was willing to miss out on an additional $140,000 per annum!
• A family with a premium development site worth approximately $10 million (at the correct market rate). I met with them several times over 5 years, presented many ways to sell or lease their property and achieve the best price available in the market, with sales and leasing evidence for both. Despite every agents advice, they thought they knew best and said it was worth $20 – $30 million. They never signed the required form for us so we never wasted our time presenting buyers, despite knowing we had several ready to buy – at market price. They didn’t like our lower, realistic and factual price estimates so they went to auction twice with other glamour agencies who talked them into believing they’d achieve their unrealistic expectations. The auctions cost them approximately $10,000 each. Both were passed in (no surprise there) and this prime site sits vacant today, dilapidated, no income and costing them $150,000 per year in rates and fees. One day it will be worth $20m, but by then, they will still want double or triple whatever that future market rate is. Their reasoning is that their site is superior to every other one on the market, despite needing about $300,000 in demolition costs just to get the block vacant and ready to build. Insanity. It is worth noting they inherited the property. They do not have the business smarts of their parents who bought well years ago and ran it at a great profit. Some people stumble into riches and do well, others let their egos get in the way. 
• A beachfront property worth about $5,000,000 (at market) in one of the most expensive streets in Australia. The owner would not sign our form, but asked us to bring offers. His expectations were about 25% above market rate. We had ready buyers (at market rate), but could not give out the address because he would not give the legally required authority. He behaved the same way with every other agent and eventually, sadly, he passed away, with no relatives and no will. A nice free gift for the government. Ironically, he used to often complain about all the taxes he had paid over the years. There’s a pretty good chance this multi-million dollar free gift to the government would have far surpassed all the taxes he paid throughout his lifetime. The logic of some people?
• A developer was wanting to sell his premium development site. We advised it was worth about $10,000,000 at the top of the market boom and we had several buyers ready. He thought he could do better (again, because his site is better than everyone else) and wait for the ultimate offer. Now in his 90’s, he is near the end of his life and the property sits barricaded and unsold and costing around $120,000 per year. Now considered a ‘white elephant’ site with a heavy unsalable stigma attached to it, it’s unlikely to sell anywhere near our previously quoted top price within the next 7 – 10 years.
• And so on…

What’s the moral of the story?

Most of these sorry tales are all due to ego. People wanting to be right – at any cost. It’s simply insane. 

So don’t be a tyre kicker!