A major stumbling block in the listing process might be (often is) the price. Price is one of the largest determining factors of the client’s net, so it is very important to the client’s satisfaction.
If the property is not shown or does not receive offers, there is no net. Many books have been written on pricing philosophies, and they each discuss the correlation between overpricing and fewer showings thereby reducing the sample of buyers.
With fewer buyers looking at the property, you will have fewer motivated buyers from the core group. With fewer motivated buyers, you can expect fewer offers. The conclusion – with a higher price, you will ultimately receive a lower price.
The corollary is true. A market-value price or a below market price will receive so much activity that you will see an increase of motivated buyers and ultimately a higher sales price. You see this played out on eBay where no reserve auctions starting at $1 can ultimately sell for much more than the item’s value because of the sheer number of buyers bidding to own it. These are bidders who would have never seen the property unless the activity in the auction was not obvious.
The problem with pricing is the seller has thought much more about the pricing of the property for a lot longer than you have. They might have comps that you do not have or adjustments that they have been rationalizing for weeks, months, or even years. This means that you have to be prepared. A good CMA, knowledge of the competition, and understanding of the past sales are necessary ingredients to fight for the best sales price. I am going to have to assume that you know how to do that.
What do you do when you come against a cement-headed seller who will not listen to the correct price or there are competing real estate agents who have offered a higher price to the seller?
What happens if you are forced by the seller to take an overpriced listing, because they want to “test the market” or it is a referral from a valued client? I wouldn’t do it in markets that are stable or going down, but I would always do it in markets going up, if the clients had motivation.
In fact, motivation is the operative word here. You cannot get a price reduction unless you have the listing. If the client is motivated, you will be able to obtain the price reduction. Pricing can be an inexact science, and with any home or property, emotions will take over. You and a motivated seller will acquiesce to list at a higher price in this hot market. The best time to receive the price reduction is at the listing!
Tomorrow, we’ll share a document that you can use in your listing presentation as a “future price reduction” document. If your marketing efforts are not successful in obtaining an offer or enough showings, then you get to implement the “future” price reduction amendment. Come back tomorrow!
Be the best at obtaining and selling your listings! Walter’s Beating the Competition Every Time is a multi-media system offering what you need to get the signature.
Check out the details here: http://www.waltersanford.com/shop/beating-the-competition-every-time-book-dvds-audio-cd-and-data-cd/. Call 800.792.5837 and ask for the $50 blog special on this system!
