Telling the sellers the price they want to hear might get you the listing, but it won't sell the house. Have you been to a listing appointment where you felt intimidated by the sellers pressuring you on the price they want to get for their property? The absolute best antidote and basis for an honest discussion about price is statistics - the number of homes on the market in their price range and how long it will take "statistically" for the market to absorbed those houses.
The right price depends in large part on the current absorption rate in your market. Here is how you find that:
•· First, determine the number of homes closed in your market over a specific period - say, 12 months. You can get this data from the MLS.
•· Next, divide the number of homes by the number of months in the period - in this case, 12. This calculation gives a per month absorption rate.
•· Last, divide the rate into the number of current listings. this yields the months' supply of homes.
Six months' supply is considered a balanced market - when the number of listings roughly equals the number of buyers. Numbers over six percent represent a buyers' market and those below a sellers' market.
I usually also show them a graph for a seller's market area that depicts the amount or percentage rate sellers had to reduce their asking price in order to find a buyer. Wouldn't you rather be at the right price to start off with, Mr. and Mrs. Seller, than have to wait for months before adjusting to the market reality?