I recently had the situation arise where a buyer I was working with was drawn away from a beautiful home, for the chance to buy a short sale.  Unfortunately, this is not the first time I have seen this and it got me to thinking.  How are my sellers supposed to compete with the desperate sellers?

Today, there are far more listings and I'll admit, a few less buyers than in the recent years.  This leads to less of a demand and our prices are starting to reflect that.  In my market, buyers have a lot of options when choosing a home.

How do you make your home stand out from the competition?

Desperate sellers can be desperate for a number of reasons.  Maybe the circumstances changed in their family, a job was lost, they are upside down on mortgage payments, etc.  Whatever the reason, they are all desperate.  Due to their tough situation, they may reduce the price on their home far below the market, just to try and get an offer.  As a seller who wants to get the most out of the sweat and equity you have spent years building, how are you supposed to compete with that?  Well, here are some items to consider.

1) Price it right.  This is probably the most overlooked piece of the puzzle.  You need to know what the competition is and price accordingly.  For a closer look at pricing, see my article Real Estate 101

2) Prepare your home to sell!  Take the time to make your home shine.  Make Repairs.  Clean.  De-clutter.  Get ready to move.  Isn't that why you're putting it up for sale?

3) Ensure the marketing of your home reflects its value.  Has your agent taken the time to make sure the photos and video (yes, today they should have a video or tour!) are top notch.  Most buyers will begin their home search online.  Your home should look superb.  Online ads are going to be the first thing a buyer sees and is what will get them through the door.  You need to stand out from the crowd.

4) Offer incentives.  Many buyers can afford the monthly payments, but have trouble making the down payment.  If you are not cash-strapped in your home, offer to pay part of the buyer's closing costs or the down payment.  Or, maybe a home warranty.  Offer something to assist with getting the buyer in your home.

Pricing your home effectively is the ace in the hole.  But, that's not all it takes in today's market to get it sold.

If you are thinking about selling your home in Stanwood, Arlington or on Camano Island, give me a call.  I'd love to discuss your options, offer my honest opinion and give you some great ideas. 

Contact me anytime.  Jen Hudson, GRI (360) 652-1200 or jen@jenhudsonhomes.com

 

16 Comments on Sellers, how do you compete against DESPERATE sellers?

DEC
20
2007
 That's a good question!  It's frustrating to see people give their homes away.  There's a beautiful home on the corner of my street that has just been reduced to $50,000 less than they paid for it two years ago.  It makes me sad for them and for my own value.  I know in time it will reverse, but I know their decision will also affect other sellers in the neighborhood.  Good tips!
6:44pm • #1
196,059 Points 13 Featured Posts Outside Blog
I agree, it is completely frustrating when the house down the street from you lists for $40,000 less than what they could get.  There will always be people out there like this, no matter what kind of market we are in because they HAVE to sell NOW!  I think we just realize them more when the market is slower...
6:54pm • #2
424,155 Points 1 Featured Post Localism Sponsor Outside Blog
Price is king and with out it we don't even get lookers. With out the right price we don't have a saleable listing. You are right on. Thanks.
7:36pm • #3
1 Featured Post

Thanks Gregory - It is frustrating even to me to see under-priced homes, I know it has to drive my sellers crazy somedays.  As you said, time should help us recover.

Thanks Michael - You bring up a good point that there are always going to be people who have to sell now.  It just seems like there is an abundance of them recently.

Thanks Terry - Yup, price is key.  Without the right price, it doesn't matter how much effort or $ you put into advertising, it'll still sit there.
8:06pm • #4
Outside Blog
It is very frustrating.  I have a listing for market value and 2 foreclosures on their street are $70K less.  I don't see this getting better any time soon either.
8:26pm • #5
1 Featured Post
Thanks Stella.  Well, I hope it gets better.  Otherwise, I fear the foreclosure and short-sale prices may really start to drive our market, and not in a direction anyone wants to see it go.
8:35pm • #6
DEC
21
2007

Hi Jen!

Good points! Price it right.. price it right!!  Sellers have to understand that they are competing with builders, foreclosures, and other desperate sellers. 

Catherine
6:27pm • #7
1 Featured Post
Thanks Catherine!  I think not only do sellers have to understand they are competing with the builders, foreclosures & desperate sellers, there are a few AGENTS have to understand that too.
6:29pm • #8
634,174 Points 68 Featured Posts Outside Blog
Unfortunately Jen, the desperate sellers can trump good houses owned by reasonable sellers. It's supply and demand. Until the below market houses that are in good condition get cleared out they will go first. I like your idea of incentives though, because that is something that the desperate sellers probably don't offer. It may give you a leg up. Too much inventory in new homes on the ground also is stiff competition for pre-owned homes, even the good ones. The builders can easily roll out all sorts of incentives.
7:04pm • #9
259,078 Points 4 Featured Posts Outside Blog

Hi Jen..in these times it is best to keep Buyers informed, when everyone is selling, there are great opportunities such as lots of real estate choices, Check out my Blog Post on the current market for Buyers http://activerain.com/blogsview/308974/Buy-When-Everyone-One .

Cheers, Merry Christmas!
10:21pm • #10
DEC
23
2007
1 Featured Post

Thanks Gary - As a general statement, I would agree with you that desperate sellers will trump good houses.  I just like to keep in mind that with short sales/foreclosures that does deter some buyers and the properties are not always in the best condition.  For new homes, yes, builders roll out all kinds of incentives, but the new homes in my area are mostly construction sites, not neighborhoods yet.  That's another leg up I try to keep in mind.  I figure, let's just focus on what my good reasonable sellers can offer, because we can't give up competing.  In the end, it does come down to supply and demand, I wrote another article about that earlier, so I have to agree.

Hi Fred - Yes, there are great opportunities everywhere.  That's why we're here, to find them for our buyers.  Thanks for the link to your blog, I'll check it out.
3:12am • #11
DEC
25
2007
418,736 Points 28 Featured Posts Localism Sponsor Outside Blog

I'm not finding short sales to be the terrific deals some buyers assume. Agents around Sacramento, for the most part, understand the short-sale fever, so listings that say THIS IS NOT A SHORT SALE, get tons more attention, instead of the other way around. Why buy a short sale when short sales are selling at market value? Especially when you can buy a home directly from a motivated seller with no middleman involved. Remember, market value is what buyers are willing to pay and sellers are willing to accept. If it's priced too high and not selling, it's not market value.
9:28am • #12
510,350 Points 3 Featured Posts Outside Blog
This is a great post with some good information.  I will need to book mark this one for future reference. Thanks and Merry Christmas
9:34am • #13
DEC
26
2007
1 Featured Post

Hi Jennifer,

good post.  Getting sellers to "reality" based thinking in setting a price is HUGE!  I have been striving to have realtors look to me to assist with their listings.  Yes,  a lender can help.  As a preferred lender I can do 2 things that can be highly valuable to a seller.  One, I can provide lender concessions to closing costs on the sale of their house if the buyer uses me OR I can provide the same concessions to to the closing costs associated with their upcoming purchase. 

The other thing that I can do is provide "pre-approval" assurance so the seller doesn't enter into contract with a buyer that is not thoroughly pre-qualified, or "conditionally approved."  We pick up a number of deals each month from "transactions in crisis" because of lender fallout.  If I were a listing agent, I would write it into every contract.  Why more aren't willing to do this baffles me!

You work up in Stanwood; I do quite a bit of business in your area, it would be good to hear more about your business plan!  Feel free to email:  rsweum@homestead-mortgage.com

Blessings.
2:24pm • #14
DEC
27
2007
1 Featured Post

Thanks Elizabeth.  I'd have to agree completely.  Market value is what the market will pay, not what sellers want.  I'm noticing that shortsales are not necessarily the "good deals" that everyone up here thinks they are.

Thanks Rich.  I have insisted that my buyers be pre-approved and am starting to think they should be through a lender that I know and trust.  I've seen too many deals fall apart at the last minute, and I don't like wasting my clients time or my own.
12:35pm • #15
JAN
31
2008
 I agree about have a lender that you trust to refer your buyers.  The financial market has had so many changes in the past year, you need a seasoned professional to wade through the every changing loan programs.  Condo's have been recently hard hit with the new Freddie and Fannie Mae changes.  Those condo conversions sales will be much more difficult to close due to these recent changes.
7:03pm • #16

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Jen Hudson - Stanwood, Camano & Arlington,WA

Stanwood, WA

More about me…

Windermere Real Estate/M2, LLC

Address: 95020 19th Ave, Everett, WA, 98208

Office Phone: (360) 652-1200

Cell Phone: (206) 293-1005

Email Me

What you should know about real estate in Stanwood, Arlington & Camano Island, WA. And, maybe some other tips too.


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