Do Price Breaks work?

By
Real Estate Agent with YourStories Realty Group powered by Castles Unlimited® MA# 9517963

Mortgage Rate projectionsDo price breaks work I was asked by my client today as we discussed this action on his multi-million dollar property?  Preparing for the meeting took time.  I needed to research all the listings in this area of similar type and style.  My property is an upgraded older home.  It is not a gut rehab and it is not new construction.  Appraisors use 17 methods to determine price, most agents hit the CMA button.  Pricing is both a science and an art. The science part is looking at sold properties within a third of a mile sold within the last 3 months that are no more than 10% different in a variety of characteristics.  Size, lot size, age of the house, bedrooms, bathrooms, garage spaces, construction and architectural style and more are considered.  Finding something that is a perfect match is not easy with these stringent guidelines.

Entering NewtonSo what happens is that we look at other properties and give plus and minus amounts for the differences. We are sneaking into the art side of pricing, but not really there yet.  The art side is when your client asks you after looking at all the data and seeing that the break you are suggesting will really only drop your price below just one of the competitors.  They will ask why have a break at all if you don't go much lower. 

The very difficult reality to explain to a nuts and bolts client is that sometimes the nuts and bolts don't matter at all.  We are shaping the story of the house inside the market to let the market know you are paying attention and wanting to shout that you are still ready for the Buyer.  This is the Art part, it isn't about the actual amount, it is about the appearance of how these changes affect the Buyers.  A price change says, come see us.  A price change says we want to sell.  A price change says here is the deal for you.  Price changes are always triggered when a property is getting a lot of activity and no offers.  It is time for a price change, Do Price Breaks work?

Posted by

Larry Lawfer, Realtor®YourStories Realty, It's all about you,

Larry Lawfer

Partner

Realtor®, Director of Marketing

YourStories Realty Group powered by Castles Unlimited®

837 Beacon St

Newton, MA 02459

larry@yourstoriesrealty.com, 617-774-8292

Comments (7)

Steve Kantor
BEST AGENT BUSINESS - Bethesda, MD
Best Agent Business - Virtual Assistance

Good points, Larry. Thanks for sharing.

Jan 05, 2015 09:13 PM
Susan Haughton
Long and Foster REALTORS (703) 470-4545 - Alexandria, VA
Susan & Mindy Team...Honesty. Integrity. Results.

A price change says we are willing to listen.  When a property sits on the market for an extended period of time with no price changes, it often says "we are stubbon and realistic."

Jan 05, 2015 09:30 PM
Suzanne De Vita
RISMedia
Online Associate Editor

Larry, it's certainly a challenge to educate sellers on price. Well done on this explanation!

Jan 06, 2015 12:26 AM
Joe Jackson
Keller Williams Capital Partners Realty - Columbus, OH
Clintonville and Central Ohio Real Estate Expert

Great tips! Thanks for sharing!

Jan 07, 2015 12:21 AM
Debbie Walsh
Shahar Management - Middletown, NY
Hudson Valley NY Real Estate 845.283-3036

Great explanation and I know as do we all that they definitely do.  I had a price change this week of a simple $2,000 and received over 20 calls and 6 appointments and we now have an accepted offer.  Who would have thought?

Jan 07, 2015 07:23 AM
Jay McHugh
SendOutCards-Appreciation Marketing Expert - Acton, MA
YOUR SendOutCard Mentor

Well messaged Larry

 

I agree with all your points.....keep up the great updates...love watching your market through your eyes...

 

cheers......

Jan 08, 2015 08:29 PM
Larry Lawfer
YourStories Realty Group powered by Castles Unlimited® - Newton, MA
"I listen for a living." It's all about you.

Steve Kantor Thanks for your commenting.

Susan Haughton I agree, we are open for business and listening to the market.

Suzanne De Vita thank you, your comment means a lot to me.

Joe Jackson Thanks for stopping by.

Debbie Walsh It is funny how this works and sometimes defies logic.  Who said real estate is a logical business all the time.

Jan 08, 2015 08:30 PM