Sellers are always emotionally attached to the price of their homes. It’s been that way since the world’s first REALTORÒ listed the world’s first luxury prehistoric, jungle-chic cave dwelling.
Most often, sellers went through a great deal to buy their home, personalize it, create memories in it and now want to capitalize off their investment. So, it’s completely understandable that where you see “price” they see “value.”
Emotions, however, have no place in the listing of a home. It is your duty as a listing agent to get your sellers the most from their home, but, ultimately, it is the market that will dictate the selling price.
Today’s market is easily the fastest and most informed in the history of real estate, with technology allowing buyers more access to current and past listings than ever before. Therefore, getting maximum exposure for your listing will not only require a cutting-edge marketing strategy but an adaptive pricing strategy, as well.
Fact is, prospective buyers will begin to gloss over your listing after five days on the market IF they aren’t moved by the price. No offer in 15 days? It’s time for a price adjustment. The days of waiting a month to discuss a change are long gone.
I’ve interviewed and surveyed sellers from across the southeast for nearly three years to learn how to schedule price reductions that please your seller while still getting the fair market price, sometimes higher, for their home.
Here are some suggestions to help you establish the practice of price reductions in your business and avoid the fallout of asking sellers to lower price after the race has already started.
Step One – Get it Right the First Time
Easier said than done for new agents or the meeker among us, but sellers really do want you to provide the suggested pricing, not ask them for their opinion. You are the industry expert, so establish yourself as such right out of the gate. The best time to ask a seller what he is thinking about price is before you go to the appointment, in the initial interview.
Pricing isn’t normally the difficult part of your job; it’s convincing the seller to START with the correct price in the first place. After all, he or she is the one hiring you to get the job done but may also be wishing or hoping for a much bigger payday at closing than will ever be possible.
Remember, it is a misconception to think that a higher asking price results in a higher selling price, so show them where the ceiling is, based on your iron-clad research.
Find out why they want to put their home on the market to determine their motivation and goals, so that you can help them get there.
Step Two – Schedule Price Reductions
This will depend on the price you and your seller agree on, but for the sake of this blog, let’s say you and your seller have agreed on a price that is 10-20% above what you think the home will sell for.
Depending on seller motivation and comparable DOM for the surrounding area, establish dates – 10 days, then 20, then 30 after listing – that you will reduce the price of the home in MLS. Agree that you will not ask them to do this, you will shoot them a text or leave a voicemail – check out Slydial – letting them know when it’s done.
Beats calling and asking to reduce after the home’s been on the market for three weeks. They will for sure stall the process.
Step Three – Keep the Seller Informed
Automatically send recent sales, pendings and active listings in your seller’s neighborhood to your seller through your MLS to keep him up to date on what’s going on in the local market. We recommend sending these at least once a week. Remember the cold, dead-eyed stare your seller gave you when you were scheduling price reductions? Prove your strategy with these updates, and they will slowly get over it.
VIDEO – Already have an overpriced listing?
Check out today’s clip for some tips from Genny, and register for our 6 Figure Community to receive the daily calls this month with price reduction scripts!
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