Take Advantage of This Psychological Buyer Quirk to Sell Any Home Now
Once upon a time a seller could price her home with the promise that she would get the full price.
She would review each offer as it came in. She would work with her agent to make a careful and calculated decision about which offer she should take. Then, she would select her buyer–normally above or at full price.
Unfortunately, in most markets today, this doesn’t–or can’t–happen.
The Death of the Typical Bidding War
Hot markets meant buyers made absurd, exuberent offers for just about every home that was priced. That doesn’t happen anymore.
In a slow market, a typical bidding war begins–if it begins at all–with the marketing of a slightly undervalued home. That means selecting a price that is at the low end of the expected selling price range.
This may not please your seller one bit–but it may result in multiple offers. And naturally, multiple offers tend–no promise, though–to drive the selling price up.
However, if you choose a low-pricing strategy, make sure that the property is adequately exposed to the market before you entertain offers. (And make sure you use the seven natural laws of prospecting I wrote about in August.) That’s the key to taking advantage of the psychological buyer quirk I’m going to share with you in a minute.
The New, Slow-Market Approach to Pricing a Home
Typically, sellers using this approach wait 10 days to two weeks before they entertain offers. During this time there is a broker open house and one or two public open houses.
Without this exposure, your home could sell at the low end of the range because only a limited number of buyers will have seen the property.
But if all the pieces come together, you’ll have an environment for a multiple offer situation–which can be very lucrative.
How to Correct Pricing Misconceptions of a Home Seller
In addition to stressing the benefits of setting a lower price to your sellers during the pre-listing stage, this time also affords you the opportunity to correct sellers’ misconceptions on pricing.
Some sellers might be tempted to choose another salesperson who quotes them a higher asking price.
This shoud make you ask: “Does the salesperson want your success or a listing?” A salesperson who gives an unrealistically high price is making an empty promise.
Why Overpricing Doesn’t Work
Other sellers believe that overpricing will work to their advantage because it will give them ‘bargaining room.’
If you run into sellers who want to overprice their home, tell them that althouhg overpricing in a rising market may be appropriate, no one has ever had a successful client overprice in a falling market.
Leaving bargaining room isn’t as valuable a negotiating tool as bringing in a greater number of highly motivated buyers.
The Secret to Creating Irresistable Demand for a Home
How do you lure in the greatest number of motivated buyers? By setting a competitive price. Seems obvious, but you’d be surprised how many people don’t know this.
Explain to your client that an attractively priced home pulls in buyers. This sometimes means a home below market value.
Tough sell. But remind them, more buyers equals more competition. And more competition means that the home will actually sell–which, in reality, is the most important thing to keep in mind.
Tap Into This Psychological Quirk of Buyers
Did you know that a home usually gets the most attention from buyers just after it’s put on the market? That’s right. Immediately after a home is listed, its flooded by buyers.
These are the buyer’s who are highly motivated. They have agents. They have instant notification via email and text when homes go on sale. They scour neighborhoods weekly. They’re primed.
And they flock to new homes on the market–ready to make a bid on the drop of a hat if necessary.
If you could view the number of times a home is seen during the first four weeks, what you’d see is a spike in activity in the first two weeks–then a sudden drop.
That’s why it’s necessary to encourage sellers to take full advantage of this phenomenon by showing their home in the best condition and…setting it at the best price during the first four weeks of the marketing efforts.
You want this home to be something buyer’s won’t forget–even if they’re not ready to buy just yet.
Let’s say you did this for two weeks…but no takers. After your careful research, you and the sellers decided it’s still priced too high because you got plenty of activity…but zero offers.
If you use a tool like Showing Feedback, all you have to do is log into your Email Center on your account and send an email blast to all of the agents who have viewed the home. This includes every single person who was in the first wave of buyers.
If the home is priced accordingly, then there’s a good chance that you have laid the foundation for multiple offers.
What to Do Next
Now, if you find that you still don’t get the activity that you expected–lower the price even further.
You’ll eventually get to a point where the house is priced at an acceptable rate for the market. Send out another email blast…and kick back…and wait for the calls to come in.
Because they will. It never fails
Remember: There are enough people in this world who are interested in your client’s home. As long as you have chosen your clients carefully.
You just have to make sure the price gets to a point that they crave. Then they’ll come out of the woodwork.
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