The sale is expected…

By
Managing Real Estate Broker with Fathom Realty PB00068179

When a client lists their property with you they expect one thing and that is a sale of the property.  We all know that some take longer than others but that's what the client expects.  I have started listing the property per the clients request with a twist that within 30-45 days if we don't have an offer or someone interested the price drops by XXX dollars.  I put it in the listing contract and have the clients sign off on it.  I have not had any arguments yet and I wonder if you are doing the same thing.  It's a great day to buy or sell a home.

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  1. Lenn Harley 05/27/2010 11:39 PM
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Ambassador
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Margaret Woda
Long & Foster Real Estate, Inc. - Crofton, MD
Maryland Real Estate & Military Relocation

I have done that in the past, and never had any objection.  If there were ever a market for this, it would be now.  I should probably start doing it again.  Thanks for the reminder.

May 27, 2010 11:02 PM #1
Rainmaker
722,837
Patrick White
Home Driven Realty, Inc - Baldwin, NY
Driven to bring New Yorkers home

Hi James,

Thanks for the post. It is important to price the property to the market. Sometimes sellers may overprice the property substantially for their market. This may have the effect of low property exposure in the critical initial marketing period.

May 27, 2010 11:05 PM #2
Rainer
325,365
Bernadine Hunter, SFR, ACRE
Keller Williams Greater Columbus Realty - Pickerington, OH
"Finding Solution to Your Real Estate Needs"

Absolutely. We set that expectation from the beginning. Its amazing; however, how many homes are still put on the market overpriced for the market.

May 27, 2010 11:10 PM #3
Rainmaker
1,988,517
Andrew Mooers | 207.532.6573
MOOERS REALTY - Houlton, ME
Northern Maine Real Estate-Aroostook County Broker

The market is always in flux, and if your price is realistic, your market is aggressive, creative and far reaching, the property sells. To pre-determing a drop sometimes is worked out but often a seller says I agree with your logic on pricing, it is rock solid and we are not jacking it up to have wiggle room. They just are not horse traders and calmly say if a buyer can find a home, land, farm, whatever better than mine, for less money, grab it. No hard feelings. Those are the real estate transactions without the drama, emotional highs and lows, rock throwing or seller looking at you insulted if an offer comes in. Hate the market, don't hate the REALTORS, the messenger, the property buyer locator.

May 27, 2010 11:13 PM #4
Ambassador
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Lenn Harley
Lenn Harley, Homefinders.com, MD & VA Homes and Real Estate - Leesburg, VA
Real Estate Broker - Virginia & Maryland

The timing of this market reminds me of the late 1980s and early 1990s.  When a seller wanted to list for an unrealistic price, my response would be, "I thought you wanted to sell now rather than next year."

Taking an overpriced listing with an agreement to reduce after 20-45-60 days simply means that the listing agent will "blow" their marketing investment on the property while it's overpriced.

If the seller wants to sell NOW, they should price for NOW.

I've seen many seller agree to lower after a time on market, then refuse to do so when the property didn't sell in 60 days.

May 27, 2010 11:32 PM #5
Rainmaker
1,816,979
Ginny Gorman
RI Real Estate Services ~ 401-529-7849~ RI Waterfront Real Estate - North Kingstown, RI
Homes for Sale in Southern RI and beyond

jim, it's a double edged sword on this one...in the past if i took the listing & i knew it's overpriced the sellers understood that i am not going to spend the dollars to market until it is reduced in 30 days to a 'saleable & marketable' dollar figure. 

ALso, i am not taking overpriced listings now but walk away wishing them luck with someone else.  I have had the sellers come back to me after it expires with another listing agent. I do believe your strategy does keep it in the forefront of sellers minds...also, every week I give them comps on current actives & solds in their market so they know how they are comparing price wise to competition.

 

May 27, 2010 11:41 PM #6
Rainmaker
3,154,830
James Dray
Fathom Realty - Bentonville, AR
Exceptional Agents, Outstanding Results

There are some people in my area that are stuck in the 2000-2004 time and can't shake it.  While I have not had a complaint sometimes it take a rude awakening to get people up to speed.

May 27, 2010 11:46 PM #7
Ambassador
920,651
Missy Caulk
Missy Caulk TEAM - Ann Arbor, MI
Savvy Realtor - Ann Arbor Real Estate

I did that a few times, when I first started in the business. Some then refused to reduce, and I was stuck.

Today with all the appraisal issues, I refuse to list higher than the market value. Now do I not get some listings? yes

But, I am not spending time trying to market an over priced listing that is not going to sell.

 

May 28, 2010 12:07 AM #8
Rainer
264,127
Bill Travis
Captain Bill Realty, LLC - Gilbert, AZ
Broker/Owner

I work mostly with buyers, and have had only a few listings. Once I took an over priced listing for an owner who had moved out of town. I spent time, above and beyond, finding contractors to replace carpet, paint, and a few other things to make it marketable.

After 4 months it didn't sell and they wouldn't lower the price. So we took it off the market for 90 days so the DOM would zero out. After the 90 day period they listed it with someone else at "market" price and told me "thank you for all the hard work you did for us, but we decided to list it with a friend."  During that 7 month period the value dropped about 50,000 dollars. Never again.

May 28, 2010 12:27 AM #9
Rainmaker
225,638
Mark Watterson
Salt Lake City, UT
Utah Real Estate

I did that a few times.

Won't do it again. 

The seller just didn't understand why I couldn't sell it without the price reduction.  I finally had to withdrawn the listing agreement.  She listed with another agent.

Today she still owns the home and it worth 15% less than at the time I listed it.

May 28, 2010 05:08 AM #10
Rainmaker
631,202
Don Rogers
Keller Williams Realty Chesterfield - O'Fallon, MO
Realtor, Broker, CDPE, GRI, OnullFallon MO & St Charles County MO homes

James,

I like this idea it does get the price objection out of the way up front and will cause less friction later on.  Do you come back and remind them of the price reduction at the time designated in the listing agreement?

May 29, 2010 01:30 AM #11
Anonymous
James Dray

Don

I do not when the time comes the price is lowered.  If it doesn't sell then I make contact with them after the next 60 days and see if they wnt to lower the price.

May 29, 2010 02:13 PM #12
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James Dray

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