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"Never underestimate the difficulty of changing false beliefs by facts"

By
Real Estate Agent

The above quote by economist Henry Rosovsky has multiple applications today as it relates to politics, science, the economy and yes, even real estate.

This point was brought home recently during a listing appointment where I knew there was at least one other agent competing for the business. During the course of the “interview” I was presenting data that suggested a price point well below the price of one of the other “professionals.” What is interesting is we were both operating from a similar set of data, however, my “mistake” was providing additional contextual data around the information in question.

Farmington Annual SalesThe data element we both agreed upon was the fact that unit sales in Farmington had increased year over year since 2008 (surprising number in and of itself). Using that data element in isolation, the other professional suggested that was a sign of definitive improvement in the local market and pricing a listing accordingly would be prudent. As you can imagine the home owner was quite pleased with the figure put forth by this presenter as it match well with the home owner's belief of the value of his property.

My data set also contained other pieces of related information which weren't necessarily in line with the home owner's now "professionally" confirmed assessment of property value.  One was the decline in the median sales price in Farmington during that same time period of over 11% (increasing sales but decreasing prices, hmmmm the plot thickens). Correlated to that figure was the change in the percent of homes selling above and below a median price of $250,000. In 2008, 64% of the homes which sold were above that price point while year to date in 2010 only 53% of homes sold in Farmington held that distinction. This was an important data element illustrating the fundamental shift in buyers (and therefore demand) in the existing market.  This was particularly important as the home owner's "targeted" price point was well above the $250,000 level.

Those data elements combined with an existing nine months of inventory on market for the home owner’s targeted price range, along with several data based answers to the home owner's mutliple questions, helped to convince the home owner (somewhat begrudgingly) my data was more relevant to their decision making process. Did I get the listing? No. Surprised? Don’t be.  But it wasn't because the home owner couldn't accept the facts being presented.   The home owner opted to not put their home on the market at this time (as we are heading into a seasonally slow period). The home owner expressed a good deal of appreciation for my data assessment and candor to say the things he really didn’t want to hear, but needed to hear. To his credit, the home owner was also asking the types of questions he needed to in order to make an economic, not emotional, decision.

As a result, using facts and a consultative approach and not simply information to secure the listing has now created a relationship that will allow me to assist the home owner in determining not only the best time to put his home on the market but also at the correct price. So my "mistake" may have cost me a current listing (and likely an overpriced one) but I believe I gained a committed client.

 

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Craig Frazer, Realtor, CRS, CDPE, GRI, CLHMS
RE/MAX Metro

Cell & Text: (801)699-6046
Email: cfrazer@remax.net

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Comments (3)

Lane Bailey
Century 21 Results Realty - Suwanee, GA
Realtor & Car Guy

There are days I think I should just wander into listing appointments and tell people that we should start at $1,000,000 and work down $50k/week until they get it sold.  ;^ )

Nov 11, 2010 03:23 PM
Craig Frazer
Farmington, UT
Real Estate, RE/MAX Metro, Davis & Salt Lake County

Lane,

It would certainly make for a more stable income stream!!!!

Nov 12, 2010 01:50 AM
Lane Bailey
Century 21 Results Realty - Suwanee, GA
Realtor & Car Guy

I think I would have a lot of listings that would be parked for a VERY long time...

Nov 12, 2010 02:12 PM