Monday, April 11, 2011
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When selling a home, any buyer wants the largest profit possible. As their real estate agent, you want the exact same thing for them. But sometimes this mindset can be the one factor that can make the difference if a house makes any profit at all.
Pricing High Can Be a Mistake
Many sellers want to price high to leave room to negotiate. In certain markets this is not a problem. But in a housing market where the price of homes is actually falling, this is not a great strategy.
Pricing your client’s home can make or break the future sale of their home. There is a lot of strategy that needs to go into setting the price. As the real estate agent, make sure you give the seller plenty of informed guidance in this area so they are making a completely well-guided decision.
It's like chasing a ball down a hill...
The best way to think of this is like a ball on a hill. The ball sits atop the hill and begins to roll. If you want to get ahead of the market, you need to get ahead of the ball rolling down the hill. It is best to actually be ahead of the ball, rather than chase it.
This process of being ahead of the ball, rather than chasing it minimizes the losses and prevents the seller from losing as much as if the ball had rolled completely down the hill and we had actually chased it down there to catch it.
The next time you are in a pricing conversation with your seller and they say they want to have room to negotiate, tell them the story about the ball. Explain to them that they don’t want to be chasing the ball, rather they want to get ahead of it on the hill and minimize their overall losses. No one wants to catch the ball at the bottom of the hill.
The key in pricing a home in today’s market is to remember that high is not always best. It can make the difference between a home not selling and a home that does sell. Strategic thinking should go into each home you help clients sell so you are ahead of the proverbial ball, rather than chasing and catching at the bottom of the hill.
at 11:15 AM