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Why You Shouldn't Give Closing Gifts

In the world of real estate, closing gifts are a common way for agents to not only show appreciation towards their clients, but to also leave a lasting impression. Although client gifts are a widely accepted practice for relationship building, some realtors are adamantly opposed to closing gifts, viewing them as an unnecessary expense and use of their time.

Because realtors regularly hear these arguments against closing gifts by very vocal opponents, it’s easy for them to start to feel discouraged in their efforts. However, so much of what realtors believe to be true about closing gifts really are just common myths!

Here’s our chance to debunk the most common of these myths...

Myth #1: No other professionals give gifts, so why should I?

Realtors who choose not to give closing gifts often defend their stance by saying that no other reputable professionals, such as doctors or hair stylists, give gifts to clients, which means that doing so could reduce the professionalism of the real estate industry. Furthermore, many professional realtors feel that their level of expertise and excellent customer service should be enough and that adding a closing gift is, therefore, simply unnecessary.

 we like you too

Is this perception really true?

Not exactly. In 2017 the corporate gifting market was valued at $22 billion—debunking the myth that other professionals don’t give business gifts. Although your doctor may not give you a gift at your annual checkup, your regular office visit probably doesn’t cost you hundreds of thousands of dollars. From contract signing and deal closings to holidays and milestone occasions, companies with prized relationships, where the cost of customer acquisition is high, give client gifts as part of their overall strategy to cultivate meaningful long-term relationships. Savvy real estate agents aren’t just aware of this, but they work hard to make sure their closing gifts maximize this relationship.

Myth #2: Giving a good gift is outrageously expensive.

Bigger is always better! Or, so we’ve been conditioned to believe. Some realtors are under the false impression that, in order for their gifts to be remembered, they need to be outrageously expensive, like a ticket for a lavish cruise vacation.

Are less expensive gifts less memorable?

Absolutely not! Client gifts don’t have to be expensive to be memorable, but they do need to be personal, useful, lasting, and ideally experiential. Taking note of what your clients like and need during the entire process will help guide you to find a great closing gift, one that makes them think of you every time they use it.

It doesn’t take too much effort to personalize a gift. If your client loves to cook or travel, give them a unique spice specific to their favorite region. Spices are long lasting, useful and, thanks to the power of the olfactory system, the sense of taste and smell can create a memorable connection to a time or place.

spice market Istanbul

Plus, spices have the added benefit of being used when your clients are entertaining friends and family, offering a seamless opportunity for you and your great service to be mentioned in the natural course of conversation.

create conversations about closing gifts

But, remember, every gift, no matter how small, needs to be packaged and presented with care. Just like a house is instantly judged on its curb appeal, so will your gift! And the unboxing is all part of creating a memorable experience.

Myth #3: There are no financial benefits to giving gifts.

Because realtors can only deduct $25.00 worth of gifts on their taxes, many end up feeling that there is no financial benefit to actually giving closing gifts.

Is it true?

If you are giving a gift solely for tax purposes, yes, you will be disappointed, especially if the gift is for an individual versus a group (as there are even fewer tax incentives). However, professionals who realize that their thoughtful gifts have a profound impact on client relationships will quickly realize that the money saved on taxes is nothing compared to the money earned through new business.

So, should you give your clients closing gifts? While the choice is always yours, giving a gift, especially one that is personal rather than extravagant, is a great way to set you apart from the competition, making you memorable when it comes time for past clients to refer friends and family. 

corporate gift market

Not comfortable with closing gifts? Give an anniversary of closing gift or simply write a heartfelt thank you letter.

Why you shouldn't give closing gifts for real estate

Read more

In the world of real estate, closing gifts are a common way for agents to not only show appreciation towards their clients, but to also leave a lasting impression. Although client gifts are a widely accepted practice for relationship building, some realtors are adamantly opposed to closing gifts, viewing them as an unnecessary expense and use of their time.

Because realtors regularly hear these arguments against closing gifts by very vocal opponents, it’s easy for them to start to feel discouraged in their efforts. However, so much of what realtors believe to be true about closing gifts really are just common myths!

Here’s our chance to debunk the most common of these myths...

Myth #1: No other professionals give gifts, so why should I?

Realtors who choose not to give closing gifts often defend their stance by saying that no other reputable professionals, such as doctors or hair stylists, give gifts to clients, which means that doing so could reduce the professionalism of the real estate industry. Furthermore, many professional realtors feel that their level of expertise and excellent customer service should be enough and that adding a closing gift is, therefore, simply unnecessary.

 we like you too

Is this perception really true?

Not exactly. In 2017 the corporate gifting market was valued at $22 billion—debunking the myth that other professionals don’t give business gifts. Although your doctor may not give you a gift at your annual checkup, your regular office visit probably doesn’t cost you hundreds of thousands of dollars. From contract signing and deal closings to holidays and milestone occasions, companies with prized relationships, where the cost of customer acquisition is high, give client gifts as part of their overall strategy to cultivate meaningful long-term relationships. Savvy real estate agents aren’t just aware of this, but they work hard to make sure their closing gifts maximize this relationship.

Myth #2: Giving a good gift is outrageously expensive.

Bigger is always better! Or, so we’ve been conditioned to believe. Some realtors are under the false impression that, in order for their gifts to be remembered, they need to be outrageously expensive, like a ticket for a lavish cruise vacation.

Are less expensive gifts less memorable?

Absolutely not! Client gifts don’t have to be expensive to be memorable, but they do need to be personal, useful, lasting, and ideally experiential. Taking note of what your clients like and need during the entire process will help guide you to find a great closing gift, one that makes them think of you every time they use it.

It doesn’t take too much effort to personalize a gift. If your client loves to cook or travel, give them a unique spice specific to their favorite region. Spices are long lasting, useful and, thanks to the power of the olfactory system, the sense of taste and smell can create a memorable connection to a time or place.

spice market Istanbul

Plus, spices have the added benefit of being used when your clients are entertaining friends and family, offering a seamless opportunity for you and your great service to be mentioned in the natural course of conversation.

create conversations about closing gifts

But, remember, every gift, no matter how small, needs to be packaged and presented with care. Just like a house is instantly judged on its curb appeal, so will your gift! And the unboxing is all part of creating a memorable experience.

Myth #3: There are no financial benefits to giving gifts.

Because realtors can only deduct $25.00 worth of gifts on their taxes, many end up feeling that there is no financial benefit to actually giving closing gifts.

Is it true?

If you are giving a gift solely for tax purposes, yes, you will be disappointed, especially if the gift is for an individual versus a group (as there are even fewer tax incentives). However, professionals who realize that their thoughtful gifts have a profound impact on client relationships will quickly realize that the money saved on taxes is nothing compared to the money earned through new business.

So, should you give your clients closing gifts? While the choice is always yours, giving a gift, especially one that is personal rather than extravagant, is a great way to set you apart from the competition, making you memorable when it comes time for past clients to refer friends and family. 

corporate gift market

Not comfortable with closing gifts? Give an anniversary of closing gift or simply write a heartfelt thank you letter.

Why you shouldn't give closing gifts for real estate

Read more


Realtor Etiquette Tips: How Do You Do Closing Gifts For Real Estate?

Like anything in business, there are plenty of dos and don’ts when it comes to purchasing and giving closing gifts for real estate. Below is some insight into the customary etiquette and rules both buyers, sellers and realtors should know.

Should buyers and sellers give closing gifts to realtors?
The general rule of thumb is no, not really. It's traditionally the other way around. That said, if buyers or sellers do want to give a gift, one of the most appreciated gestures is providing your realtor with referrals and writing positive reviews online.

closing gift for real estate
Should agents give closing gifts to buyers and sellers?
While, of course, closing gifts aren’t required, it’s a great way to make a positive impression, one which will encourage clients to refer their friends and family, or use you again for their next real estate transaction. In order to nail closing gifts for real estate, savvy realtors tailor them to each client’s personal interest, ensuring that the gift feels genuine.

See related: How To Turn Closing Gifts Into Clients

Do realtors need to worry about violating RESPA when giving closing gifts?
In Section 8 of the Real Estate Settlement Procedures Act (RESPA), it says that "no person shall give and no person shall accept any fee, kickback, or thing of value pursuant to any agreement or understanding, oral or otherwise, that business incident to or a part of a real estate settlement service involving a federally related mortgage loan shall be referred to any person.” What this means is that any gift given as “quid pro quo,” where something is expected in return, is a violation. A closing gift, then, that comes as a simple “thank you” - with no strings attached - is perfectly fine.

Still not sure about the perfect closing gift for real estate? A handwritten thank you note is always appreciated - and a safe bet.

How Do You Do Closing Gifts For Real Estate

Disclaimer: The materials available at this web site are for informational purposes only and not for the purpose of providing legal advice. Speak with a RESPA attorney in your state to make sure you comply with all applicable laws.

Read more

Like anything in business, there are plenty of dos and don’ts when it comes to purchasing and giving closing gifts for real estate. Below is some insight into the customary etiquette and rules both buyers, sellers and realtors should know.

Should buyers and sellers give closing gifts to realtors?
The general rule of thumb is no, not really. It's traditionally the other way around. That said, if buyers or sellers do want to give a gift, one of the most appreciated gestures is providing your realtor with referrals and writing positive reviews online.

closing gift for real estate
Should agents give closing gifts to buyers and sellers?
While, of course, closing gifts aren’t required, it’s a great way to make a positive impression, one which will encourage clients to refer their friends and family, or use you again for their next real estate transaction. In order to nail closing gifts for real estate, savvy realtors tailor them to each client’s personal interest, ensuring that the gift feels genuine.

See related: How To Turn Closing Gifts Into Clients

Do realtors need to worry about violating RESPA when giving closing gifts?
In Section 8 of the Real Estate Settlement Procedures Act (RESPA), it says that "no person shall give and no person shall accept any fee, kickback, or thing of value pursuant to any agreement or understanding, oral or otherwise, that business incident to or a part of a real estate settlement service involving a federally related mortgage loan shall be referred to any person.” What this means is that any gift given as “quid pro quo,” where something is expected in return, is a violation. A closing gift, then, that comes as a simple “thank you” - with no strings attached - is perfectly fine.

Still not sure about the perfect closing gift for real estate? A handwritten thank you note is always appreciated - and a safe bet.

How Do You Do Closing Gifts For Real Estate

Disclaimer: The materials available at this web site are for informational purposes only and not for the purpose of providing legal advice. Speak with a RESPA attorney in your state to make sure you comply with all applicable laws.

Read more


Are Closing Gifts For Real Estate Tax Deductible?

With tax season officially upon us, a lot of realtors are looking at their expenses to see, among other things, what can be written off. One of the most widely discussed questions has to do with closing gifts for real estate: Are they tax deductible?

Below are three of the most common questions, answered by industry experts, that should help you better understand this perennial real estate question.

Question #1: Are Closing Gifts Tax Deductible?

Are Closing Gifts for Real Estate Tax Deductible?

Are Gifts to Business Clients Deductible?

According to Stephen Fishman, closing gifts for real estate are tax deductible, but they are “subject to draconian limits.” This means that you can only deduct gifts up to $25 if you are giving it to an individual. In commercial real estate, where gifts are often given to an entire group or company, full deductions can be made up to any “reasonable amount.”

Question #2: Is there any type of closing gift for real estate that is fully deductible?

How to write off gifts on your taxes

Gifts can be deductible business expenses, but IRS limits are strict

Stephen Fishman again lends his expertise by clarifying that marketing and promotional items given as gifts are fully deductible. However, in order for a closing gift to qualify, it must be branded. Any gift that doesn’t have visible marketing on it will not be fully deductible.

See related: Little Guide to Corporate Gifting (with best practices for branding gifts)


Question #3: How can I make sure my closing gift expenses are deducted properly?

How to deduct client gifts from your taxes

Are business gifts deductible?

The IRS always recommends that everyone, including real estate agents, keep thorough records and receipts to make sure that deductions are made accurately.

Eva Rosenberg, the publisher of TaxMama.com recommends you break out each component of the gift to accurately record it in the right account, such as gift wrap, shipping, tax, and the gift itself. That way you can maximize your deduction. 

See related: 5 Gifts For A Traditional Housewarming

Disclaimer: This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice.

Read more

With tax season officially upon us, a lot of realtors are looking at their expenses to see, among other things, what can be written off. One of the most widely discussed questions has to do with closing gifts for real estate: Are they tax deductible?

Below are three of the most common questions, answered by industry experts, that should help you better understand this perennial real estate question.

Question #1: Are Closing Gifts Tax Deductible?

Are Closing Gifts for Real Estate Tax Deductible?

Are Gifts to Business Clients Deductible?

According to Stephen Fishman, closing gifts for real estate are tax deductible, but they are “subject to draconian limits.” This means that you can only deduct gifts up to $25 if you are giving it to an individual. In commercial real estate, where gifts are often given to an entire group or company, full deductions can be made up to any “reasonable amount.”

Question #2: Is there any type of closing gift for real estate that is fully deductible?

How to write off gifts on your taxes

Gifts can be deductible business expenses, but IRS limits are strict

Stephen Fishman again lends his expertise by clarifying that marketing and promotional items given as gifts are fully deductible. However, in order for a closing gift to qualify, it must be branded. Any gift that doesn’t have visible marketing on it will not be fully deductible.

See related: Little Guide to Corporate Gifting (with best practices for branding gifts)


Question #3: How can I make sure my closing gift expenses are deducted properly?

How to deduct client gifts from your taxes

Are business gifts deductible?

The IRS always recommends that everyone, including real estate agents, keep thorough records and receipts to make sure that deductions are made accurately.

Eva Rosenberg, the publisher of TaxMama.com recommends you break out each component of the gift to accurately record it in the right account, such as gift wrap, shipping, tax, and the gift itself. That way you can maximize your deduction. 

See related: 5 Gifts For A Traditional Housewarming

Disclaimer: This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice.

Read more


How To Write A Thank You Letter To Seller After Closing

In theory, the real estate closing is one of the most exciting parts of buying and selling a home. It’s the last step—the grande finale—in the many months-long real estate transacton that ends with the exchange of keys to someone’s dream home.

But if you’re feeling a little bit of separation anxiety, you’re certainly not alone. Like all things related to buying and selling a home—from home staging and inspections to broker’s open house—real estate is built on relationships. After all, you’ve spent a lot of time inside the seller’s home and on the phone together, so its only natural to have developed a bond.

As an agent, you know that strong client relationships are key to generating leads and referrals. So before you close your client file and dash off to the next listing, make some time to show your appreciation with a thank you letter to the seller after close of escrow. In the age of social media, a handwritten letter takes just a small amount of time, but offers a big opportunity to stand out and leave a lasting impression. 

In the age of social media a handwritten letter stands out.

Why Real Estate Closing Thank You Letters Are Important

As we previously wrote about, more than 40% of people find real estate agents through word-of-mouth. That’s a lot! So beyond providing exceptional service, taking a few moments to ensure you stay top of mind with your clients seems like a worthwhile investment.

Over forty-percent of people find real estate agents through word-of-mouth #referralmarketing 

 

Click to tweet

Click To Tweet

 

 

Thank you letters nurture the power of word-of-mouth marketing by reminding the seller about the positive interactions you had while demonstrating your thougtfulness and attention to detail in tangible form. Letters also provide your client with your name and contact information to be easily retrieved when they are inspired to recommend you.

Many realtors also use closing gifts to stay top of mind. Personalized gifts can create memorable monents, but don’t forget to include a personal and heartfelt thank you note. 

How To Write A Thank You Letter To A Seller

You can send thank you letters in all communication forms, but handwritten letters are the most meaningful. People don’t receive many handwritten letters anymore, so the very act of sending one will make your gesture stand out. It also seems more personal and appreciative to write how you feel by hand. People sense that you care more when they see you took the time to individually write a note to them.

See related: Thank You Letter Examples For Real Estate Marketing

Don’t use one letter to send to each seller. A template gives you a ready-made structure regarding the points you want to make and how to close the letter, but you do want to retain some spontaneity. So write one thank you letter and save a copy of it to use as a template, but don’t send the same one to every client.

Include a brief, personal point about why you’re thankful for the relationship you’ve built. Maybe the seller was particularly courteous or funny. You spent quality time with them, there should be something that honestly stood out to you. It doesn’t have to be detailed or lengthy; just one sentence tailored to the seller can be enough for them to realize that it’s a sincere expression.

In your thank you letter, invite them to ask you questions or call on you again. Ensure it is the last point you make before closing, so that it lingers even after they put the letter away. With your invitation, supply a phone number, website, or any other means of contact you wish them to use and share.

If this all sounds too time consuming, or you’ve been swiping so long on your smartphone you’re unsure of your penmanship, try hiring someone to handwrite your letter with one of these 4 online handwritten note services:

One final note: whether you choose to write your own thank you letter or outsource it, make sure your letter is delivered on nice, high quality paper or card stock.

Do you send thank you letters to sellers after closing? Do us a favor and share your tips in the comments below!

 

Source: NAR

Read more

In theory, the real estate closing is one of the most exciting parts of buying and selling a home. It’s the last step—the grande finale—in the many months-long real estate transacton that ends with the exchange of keys to someone’s dream home.

But if you’re feeling a little bit of separation anxiety, you’re certainly not alone. Like all things related to buying and selling a home—from home staging and inspections to broker’s open house—real estate is built on relationships. After all, you’ve spent a lot of time inside the seller’s home and on the phone together, so its only natural to have developed a bond.

As an agent, you know that strong client relationships are key to generating leads and referrals. So before you close your client file and dash off to the next listing, make some time to show your appreciation with a thank you letter to the seller after close of escrow. In the age of social media, a handwritten letter takes just a small amount of time, but offers a big opportunity to stand out and leave a lasting impression. 

In the age of social media a handwritten letter stands out.

Why Real Estate Closing Thank You Letters Are Important

As we previously wrote about, more than 40% of people find real estate agents through word-of-mouth. That’s a lot! So beyond providing exceptional service, taking a few moments to ensure you stay top of mind with your clients seems like a worthwhile investment.

Over forty-percent of people find real estate agents through word-of-mouth #referralmarketing 

 

Click to tweet

Click To Tweet

 

 

Thank you letters nurture the power of word-of-mouth marketing by reminding the seller about the positive interactions you had while demonstrating your thougtfulness and attention to detail in tangible form. Letters also provide your client with your name and contact information to be easily retrieved when they are inspired to recommend you.

Many realtors also use closing gifts to stay top of mind. Personalized gifts can create memorable monents, but don’t forget to include a personal and heartfelt thank you note. 

How To Write A Thank You Letter To A Seller

You can send thank you letters in all communication forms, but handwritten letters are the most meaningful. People don’t receive many handwritten letters anymore, so the very act of sending one will make your gesture stand out. It also seems more personal and appreciative to write how you feel by hand. People sense that you care more when they see you took the time to individually write a note to them.

See related: Thank You Letter Examples For Real Estate Marketing

Don’t use one letter to send to each seller. A template gives you a ready-made structure regarding the points you want to make and how to close the letter, but you do want to retain some spontaneity. So write one thank you letter and save a copy of it to use as a template, but don’t send the same one to every client.

Include a brief, personal point about why you’re thankful for the relationship you’ve built. Maybe the seller was particularly courteous or funny. You spent quality time with them, there should be something that honestly stood out to you. It doesn’t have to be detailed or lengthy; just one sentence tailored to the seller can be enough for them to realize that it’s a sincere expression.

In your thank you letter, invite them to ask you questions or call on you again. Ensure it is the last point you make before closing, so that it lingers even after they put the letter away. With your invitation, supply a phone number, website, or any other means of contact you wish them to use and share.

If this all sounds too time consuming, or you’ve been swiping so long on your smartphone you’re unsure of your penmanship, try hiring someone to handwrite your letter with one of these 4 online handwritten note services:

One final note: whether you choose to write your own thank you letter or outsource it, make sure your letter is delivered on nice, high quality paper or card stock.

Do you send thank you letters to sellers after closing? Do us a favor and share your tips in the comments below!

 

Source: NAR

Read more