This is most definitely a buyers' market. Not to sound like a continuous loop recording, but I keep seeing the negative instead of the positives about the current real estate market. And the negative "news" continues to come from within the industry. I can't figure it out.
Home owners and potential home buyers don't care about the statistics compared with a month ago, a year ago, or a decade ago.
Of course, I get asked by my clients about ways to combat this. I thought I'd pass some along here. Please let me know what you think, and pass along some ideas. But I am going to present them for home buyers.
If I had a true motivation to sell my home today, I would do my homework before calling my realty agent. First, I would look in the local paper and online for similar local homes for sale based on the features I will be offering. That is so important. I would read every description carefully, and compare it with what I will have to offer. Then I would consider what "buzz words" I could add.
For example, my home right now is within walking distance of 2 bus lines and a commuter train line. With gas prices being what they are, my pitch might just start with "close to train and bus" ahead of "3 bedrooms....." and the rest. My home also just had zero water come in following an 8 inch deluge of rain during the mid-September storms that drenched much of the nation. Yet, some streets were closed within a mile of where I live due to standing water. You had better believe I want that highlighted. Pets are allowed where I live and that was also a consideration in purchasing the home years ago. Yet, other than some of my clients, I very rarely see "Pets OK" in an advertisement or description of an available home.
Frankly, not enough realty agents consider these points when marketing a specific property. I could let it slip years ago, but not in this market. And in my role as a motivated seller (for the purpose of this example), I am taking charge.
Once I list my "weapons", such as proximity to schools and transportation, pets, less likely to flood, near shopping and expressway, pets, and the like, THEN I find and compare descriptions and prices on homes with similar features in my area.
Let's say that 3 bedroom homes within 5 miles of mine are all listed between $300,000 and $375,000. Then I know my range. Next, I compare my "weapons". This is where marketing comes into play. I might not know that 3 other homes nearby are pet friendly, didn't flood, and are also near the train and bus lines, because it isn't in the advertised description of the property. My mission is to make that the fault of the listing agent for not pointing out every strength possible.
But that factors into my price strategy. A potential buyer looking in that price range (or higher) knows to look at more than one price vs. another. To put it another way, I can appeal to a potential buyer by getting them to see that my home will enable them to house their pets and walk to the train or bus. In the long run, that should be worth $2,000 more than a similar house that doesn't offer those benefits. That is just an example, but my point is to use every weapon about your house and show potential buyers the added value.
Think about when you go into a convenience store to get a soft drink. You can get a 12 oz. drink for 89 cents. But you can get a 20 oz. drink for 99 cents. You are getting over one-third more for merely an extra dime. You see the value and think the 89 cents drink isn't worth it. But in fact, you really are spending 10% more than you need to in order to get your drink. Keep that in mind when you are setting an asking price for your house.
Keep in mind that the other homes in the area are already priced to include the agent commission. So you don't need to add any more than necessary.
Now that I have an idea of what I would sell for and have done my own local research, THEN I would contact my agent. But I would not just ask him/her/them to come over and list the home. I would ask them to show me some of the other properties in the area as if I am a buyer. And I would spend a couple of hours going to see those homes. Then I would see how the other potential sellers are staging and presenting their home, and hear the listing agent point out the major weapons for that home.
After that, I present my 'weapons' to my agent, review what was learned and observed during my tour of other available homes, and get down to business. I then request the selling weapons that I want pointed out and why I should get $360,000 (example) for the home.
If my agent does the "let's list it for $390,000 and go down to $360,000" routine, I would refuse. Just as an agent should walk away from a listing from an unreasonable seller, I think a seller should only work with a reasonable agent. It goes both ways. At least it should.
The idea is to show that my home is worth $4,000 more than a similar home down the block and show the reasons why. If my agent can't do that, I'll find somebody who will.
Granted, I have 20 years of experience working with agents and lenders on advertising and marketing over the years, but I really did personally use this 2 years ago for some relatives with a property to sell. I found a similar property a block away that was listed for more money and then found two features "my" property had that were better. Sure enough, my relatives got an offer higher than the other home nearby was listed for at the time. Frankly, too many agents out there would react by pricing my relatives' home for a few thousand LESS than the other home. Therein lies the problem.
If you are seriously ready to sell your home, find your weapons, then find your agent.
Book Briefs #44
4 days ago