Okay, so I've been a bit focused on the pricing of real estate property in recent posts. Well, I've got more to consider and how you can possibly help your clients and your efforts...
THE SITUATION: New listing or sales opportunity. Does the buyer want to really sell? Or are they just unrealistically testing the water to see if they can get a premium price (in this market!!)?
THE TEST: The property that will have the best chance to sell under current market conditions will be the BEST VALUE in that area/neighborhood at this PRICE POINT.
(Notice I did not say "best price." I said "best value!")
THE QUESTION: Does this property meet THE TEST?
THE ANSWER...
IF YES: Cool. You are on target to help sell a property!
IF NO: You've got work to do and options to consider. Perhaps if you are considering a listing, the client can be coached (not lectured) on appropriate pricing.
(For more on this see "... because my house is SPECIAL!" and Your Seller Insists on Overpricing? Try This! and be sure to read the follow-up posts that have great ideas from other AR'ers. (Is "AR'ers" a word?) )
Perhaps your potential listing client won't budge on price. Are you willing to list a house that may not move no matter how much effort? That is your decision, not theirs. Can you make that decision? Are you selling houses or just a lure for listings?
If you are working with a buyer, you need to line them up with the best value or values. This property is probably not one of those. The best value are the properties they will realistically consider. Everything else is a waste of time for you, the buyer and the seller (or as I like to say, "Teaching the Pig to Sing...").
Clearly this is a simplification. But sometimes simple helps the agent, the seller and the buyer cut through the confusing details.
Have a great day!
OK, what do you do if the sellers in your area are still living in 2006 price world????? I've had a tough time convincing people that the pricing on last year or the year before just does NOT apply anymore? We've had a resurgence of foreclosures, and inventory is high, so what are these sellers thinking???? Thanks for the info.
Hi Rose, take a look at my earlier posts on "... because my house is SPECIAL!" and Your Seller Insists on Overpricing? Try This! about the 2006 mindset.
And sometimes the best answer is to not waste your time on people not in reality. Focus your time on the other potential clients. They are out there and your credibility will improve if those people see you understand the current market and are not focused on pushing overpriced houses.
You can't serve two masters... the overpricers and the current reality sets... and still have maximum value as a trusted advisor.
Sellers sometimes think they know more about real estate than us.. which makes sense considering that we as a profession get a bad rap. There is so much information online for sellers to weed through. Even with all of the media hype about the market, sometimes the sellers still aren't "getting it".
My strategy would be to print out ALL of the expired listings, ALL of the "on market" listings,and ALL of the sold listings. Then present them with absorption rates. If they truly want to sell, they will lower their price. If not, maybe you should give the listing back. If you continue to market the overpriced property, you may make your sellers very angry. Let them be angry at the next person that lists their home and doesn't sell it. They will come back to you as a reward for telling them the truth.
Lori, that is brilliant! I love the use of the expired listings and the curent listings, likely with Days on Market! We don't want all customers... just the good ones!