My aunt and uncle received a closing gift from their contractor, and were a bit put off by it. They were remodeling their home in Los Angeles, and when the renovations were complete, their contractor brought them two bottles of Cristal champagne. He opened one, and insisted they all share it together.
There isn’t necessarily anything wrong with this, and pricey champagne might be the right move for certain clients. However, some might interpret this gift as essentially saying “can you believe you paid me so much that I can pop Cristal like it’s Diet Coke?” Renovations are expensive, and even if you’re spending a lot of money, you may want to feel like you’re spending money in a practical way. My aunt and uncle thought this perhaps well-intentioned gift was a bit tacky, and I think many clients might feel this way.
On the other hand, Easy Agent Pro describes a Beverly Hills agent whose gifts make Cristal look like a bladder of boxed wine. This agent gave recent clients a private jet to Vegas and a four-night stay at the Encore Resort as a casual “thanks for your business,” and he joined them for the trip. Though this is extravagant, his clients did spend $15 million on their home. Reportedly, all parties had a lovely time.
Giving a closing gift can be like playing with fire if you don’t know what you’re doing. However, I think closing gifts are usually appropriate and a good idea for the real estate business. That said, there are many agents who completely disagree. After all, you don’t get a Vegas vacation from your surgeon when you get an operation, or from your CPA when they complete your taxes. Wouldn’t it be strange to get a bottle of Dom Perignon from your vet for the expensive operation they just performed on your cat?
I can understand this mentality; why is real estate one of the only professions where you feel obligated to buy some pricey gift every time you perform professional services for a client? Betsy Pepine of Pepine Realty in Gainesville, Florida says she never gives closing gifts, in part because she feels it devalues her professional services. I can see where she’s coming from; your excellent, professional, and effective services should be enough for your client. That said, I do think there’s a difference between a real estate purchase and the fee you pay your accountant, or the fees you and/or your insurance company pay for your surgery.
A home is often the largest single purchase a person will make in their lifetime; it’s an exciting symbol of hard work and good fortune. There is a celebratory aspect to buying a home that does not exist when you pay for your pet’s surgery or for your taxes. The bond between agent and client through perhaps the largest, most thrilling purchase of a lifetime is of a fundamentally different nature than your connection to your lawyer or surgeon. Getting surgery is something that must be done, whether or not you want to. In no way does this mean that surgeons are less important than real estate agents. However, this does mean that gift giving fits the bond between client and real estate agent naturally, since buying a house is a choice, a symbol of achievement, and is a special combination of fun, personal, and terrifying. I think this unique nature of the home-buying experience is why about 77% of agents have given closing gifts to their clients, according to REALTOR® Magazine.
Whether or not you’re giving closing gifts, you must learn to read the room to be successful in real estate. For example, if you’re selling lower-priced starter homes in a small town, don’t drive your clients around in a Lamborghini. However, if you’re selling $15 million properties in Beverly Hills and you’re not driving a Range Rover, you may lose out on clients. Similarly, the best closing gifts to give are entirely dependent on the market you’re in, and on your personal relationship with your clients.
Don’t be afraid to ask agents in your market what kinds of gifts they give. I’m not particularly good at gift-giving, so I try not to do anything too risky. It’s great for business if you can get something thoughtful and personal that your client will remember forever, unless they’ll remember it forever because it was weird and terrible. Perhaps someday I’ll be giving $30,000 gifts that fly and serve Veuve Clicquot, but for now I’ll stick to safe, low key, good quality gifts, like a bottle of local wine and some nice chocolates.
https://rehrealestate.com/the-importance-of-closing-gifts/
https://www.easyagentpro.com/blog/real-estate-closing-gifts-for-buyers/
The Closing Gift: Spend $0 or $20,000?
