When do you want me to start telling you the truth?

By
Real Estate Agent with Keller Williams Big Bear

This is a question that I will sometimes ask sellers in our market. Often when I go out on a listing appointment the sellers have met with other agents.

The sellers almost always have an idea of some of the market conditions and place a value on their property that they keep as a secret as long as they can. Sellers seem to want to wait and see which of the agents that they are interviewing will outbid their perceived value.

This actually worked to sellers advantage a couple of years ago, but these days it's a recipe for disaster. I always show up to the listing appointment with a price that is printed in the comparative market analysis. I know that many agents don't do this because they tend to roll over when they find out what that secret price that the seller has is. I realize that my preprinted price is a estimate without an interior view initially, but my price is not in stone either (many times I will know the home from a prior listing or sale). I have found recently that even a price range may not be the best thing for the sellers. Sellers almost always want to go to the top of a suggested range. The higher you start on the price, the more the sellers will feel like they are giving up when they really get to the price that they should have started at in the beginning. 

The price needs to be set based upon the comparable properties, neighborhood location, street appeal etc. just to get it shown these days in our market. The first sale that you have to make is to the Big Bear Real Estate agents. If your home is overpriced in the Big Bear Real Estate Market, you will blend in with the other 1000 or so that are also overpriced. Most of the time homes in our market that have interior upgrades will not necessarily sell for more than the other homes without these upgrades, they will just sell sooner. If the market is moving down as it is currently that can mean thousands to a seller. Obviously there are exceptions, but in the current Big Bear Real Estate market it is a mistake to try to buy or sell the highest price home in the neighborhood.

So, once I get this number out of the seller... I sometimes have to ask, when do you want me to start telling you the truth? If I wait to tell you the truth 90 days from now, how much does that cost? What sign do you want to see in front of your house 90 days from now, JUST REDUCED or SOLD!

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Rainer
14,598
Marsha Cleaveland
No longer in the sales business - Glendale, AZ
GRI, AHWD, CNE
Pricing is key.  As professionals, it's essential we're dealing in supportable facts about value, i.e. market data on recent sales.  Your post expresses it well.
Dec 31, 2007 08:54 AM #1
Rainmaker
388,463
John Walters
Frank Rubi Real Estate - Slidell, LA
Licensed in Louisiana
It seems most sellers think their house is special and worth a million dollars.
Dec 31, 2007 09:02 AM #2
Rainmaker
289,582
Robin Rogers
Robin Rogers, Silverbridge Realty, San Antonio, Texas - San Antonio, TX
CRS, TRC, MRP - Real Estate Investment Adviser

What an excellent, and brave, way to approach a listing--with the suggested asking price already printed out! When you've got that out of the way, you can start to work with the seller, or find out right away how hard they are going to be to deal with.

Thanks for the great tip, Steve!

Cheers,

Robin

Dec 31, 2007 09:09 AM #3
Rainer
133,200
Susan Trombley
Trombley Real Estate - Wake Forest, NC
Broker/Realtor, Raleigh, Cary, Wake Forest, Youngs
Wow, I always show them what is happening and what they can expect. I do not give false hope.
Dec 31, 2007 09:12 AM #4
Ambassador
1,079,290
Russ Ravary ~ Metro Detroit Realtor call (248) 310-6239
Real Estate One - Commerce, MI
Michigan homes for sale ~ yesmyrealtor@gmail.com
That is a great question.  In 90 days do you want to see a sold sign or a just reduced sign.  Unfortunately here in Metro Detroit it probably would not matter because there are so few buyers.
Dec 31, 2007 09:25 AM #5
Rainmaker
654,299
Patricia Aulson
BERKSHIRE HATHAWAY HOME SERVICES Verani Realty NH Real Estate - Exeter, NH
Realtor - Portsmouth NH Homes-Hampton NH Homes

I always tell it the way it is, that's just the way it is.Sellers need to be realistic in this market.

Patricia Aulson/Hampton NH Real Estate 

Dec 31, 2007 09:55 AM #6
Rainer
28,441
Jen Hudson
Windermere Real Estate/M2, LLC - Stanwood, WA
Stanwood, Camano & Arlington, WA
Steve, you bring up a great point.  In some areas of my market, the interior upgrades mean just that! They sell faster, not for more.  I know that is an incredibly difficult thing for our sellers to accept, but if they expect to compete, they have to.
Dec 31, 2007 09:56 AM #7
Rainmaker
2,031,772
Elizabeth Weintraub Sacramento Real Estate Agent, Top 1% of Lyon Agents
Lyon Real Estate - Sacramento, CA
Put 40 years of experience to work for you

I find out what price the seller has in mind before stepping foot in the house. Then I bring two prices with me to the listing appointment, the high and the low, and I show them both. If you're persistent, you can squeeze the secret price out of them. If an agent is unable to get this crucial piece of information, then maybe the seller should list with somebody else. :)


Jan 01, 2008 04:49 AM #8
Rainer
64,501
David Hood
Chino Valley Real Estate - Chino, CA
The price needs to be set based upon the comparable properties, period.
Jan 01, 2008 05:22 AM #9
Rainmaker
1,073,759
Gary White~Grand Rapids Home Selling Pro Call: 616-821-9375
Flexit Realty "Flexible Home Selling Solutions" - Grand Rapids, MI
Real Estate Services You can Trust!
Nice post Steve, being new to active rain does not mean you are new to the business...you have some great points...pricing right the first time will save you both money.  Great Post.
Jan 01, 2008 01:31 PM #10
Rainer
6,796
Ray Wilburn
Keller Williams Realty - Everett, WA
CPA, MBA

That was excellent Steve!  I especially like the phrase (which sign to you want to see!)  I often say 'do you wanna be right or do you wanna be sold!  But I'll incorporate yours as well!  Great blog.  I see that you share my view that by going in right from the beggining you save yourself headache, and can potentially weed out clients that may or may not be a good fit.  Thanks!

 

Ray

Jan 06, 2008 01:00 PM #11
Rainer
36,982
Richard Parr
ADT Security Services - Slidell, LA
Home Security Specialist - Greater New Orleans, Louisiana
I love that statement....When do you want me to start telling you the truth?  I would change it a bit and ask them, "When do you want to start HEARING the truth?"  I hope you tell the truth ALL the time.  :-)
Mar 01, 2008 10:47 AM #12
Rainmaker
150,700
Steve Hirschler
Keller Williams Big Bear - Big Bear Lake, CA
Big Bear Real Estate

Richard,

Thanks for reading the post and yes I do tell them the truth ALL the time. I like your change to HEARING THE TRUTH.

Mar 01, 2008 10:57 AM #13
Rainer
24,122
Holly Galligan
Coldwell Banker Sky Ridge Realty - Lake Arrowhead, CA

Steve,

This is a great post and a great point. I like all of the points you made, but I think the one about standing out to fellow agents is really important. In our market it appears that the top 10% of the homes (top= best perceived value- location, price, clean) are selling and some receiving multiple offers, the rest just linger and chase the market down. Being strong initially is so important and I am a work in progress at that. I will put a few of your phrases to work!

Thanks,

Holly Galligan, Realtor ~ Lake Arrowhead, CA

Mar 02, 2008 03:13 AM #14
Rainmaker
150,700
Steve Hirschler
Keller Williams Big Bear - Big Bear Lake, CA
Big Bear Real Estate
Holly - Thanks for the comment. I hope you have a great 2008!
Mar 02, 2008 03:16 AM #15
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Steve Hirschler

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