A great analogy to help sellers price their home.

By
Real Estate Agent with McDonald Group GMAC Real Estatee

One of the primary challenges in helping people sell their homes is getting their home priced correctly.  When we sell anything, we set "the price we have to get" for that item.  As a real estate agents, we all try to help our clients sell their home, and a very important part of this is getting the home priced so it actually will sell.  But we all hit this pricing wall.   So what can you  do?

Even when you provide a detailed Competitive Market Analysis, look at active listings and undercontract listings for pricing trends, and try to help the seller set a realistic price, you still hear: "I've got to get this much out of my home".  More times than not this number is far, far away from what the price should be to sell.  So the next time you find yourself at this point with your client, try an analogy.  Pull a $100 dollar bill out of your wallet (or a $10 or a $20 if you're like me), and ask the home owner how much they will pay you for that $100.  When they respond, logically, "$100", tell them that you have to get $120 for it, and you can't sell it for less....and pause.  Then draw a parallel to  the real estate market, and say that it works the same way.  It won't pay $120 for a home worth $100.  Try it.  Even the most stubborn will often will stop and rethink their pricing demands when faced with the sheer logic of this analogy. 

Do you have a pricing analogy or strategy that works?  I'd love to hear about it.  I'm always looking for better ways to help my clients understand the process.  

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selling your home
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Ambassador
2,305,304
1~Judi Barrett
Integrity Real Estate Services 118 SE AVE N, Idabel, OK 74745 - Idabel, OK
BS Ed, Integrity Real Estate Services -IDABEL OK
Have you tried this with clients?  What type of comments did you get?
May 24, 2007 02:28 PM #1
Rainmaker
94,583
Roger Stensland
Keller Williams Realty Puget Sound - Maple Valley, WA
Let's Move!
I haven't tried it yet, but you can bet that I will. This way you can tell up front if they will be willing to do what it takes to sell their home.
May 24, 2007 03:54 PM #2
Ambassador
2,138,343
Respect Realty LLC
Respect Realty LLC - Milwaukie, OR
Brokers - Oregon / SW Washington Real Estate

John, I see what you are up to. You are just like my kids, always trying to get me to pull my wallet out and just lay money on the table.

Actually I think it is agreat way for them to price it right and I think I just may try it.

May 24, 2007 05:08 PM #3
Rainmaker
603,254
Cyndee Haydon
Charles Rutenberg Realty - Clearwater, FL
727-710-8035 Clearwater, Beach Short Sales Luxury Condos &Homes
John, You explained this really well and it makes a great pointl. Keep up the great job - I can see you're getting the hang of it - hope you'll consider stopping by and visiting me sometime soon :-) 
May 24, 2007 06:47 PM #4
Rainmaker
672,229
Jim & Maria Hart
Brand Name Real Estate - Charleston, SC
Charleston, SC Real Estate
This is a really great analogy.  I've hear about it before, but have never tried it.  I would love to hear how sellers respond.
May 25, 2007 04:55 AM #5
Rainer
304,164
Cynthia Tilghman, Realtor® Onslow County NC Home Specialist
Kingsbridge Realty, Inc - Hubert, NC

John,

It's certainly worth a try.  If anybody has tried it, I'd love to hear the results.  I am always open to new ideas & suggestions. 

May 25, 2007 06:20 AM #6
Rainer
2,601
John Speare
McDonald Group GMAC Real Estatee - Sandy, UT
Sandy Real Estate Pro
I have used a version of this with one seller who was struggling with setting their price.  It's not necessarily a tactic that works with all sellers, but with the ones who seem ready for your input, it is a good way to loosen them up and make a point at the same time.  I'd keep it in your "tool bag" and when the time is right, use it.
May 25, 2007 09:59 AM #7
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Rainer
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John Speare

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