Have you ever come across a property owner that wants too much for their property? Welcome to the real world, it happens all the time to real estate agents. The question is do you want the listing or not? Do you take the listing or not? Will the Client reduce the price to a more realistic level quickly so the listing does not stagnate on the market?
The pricing problem arises because most property owners think that they paid a good price for the property and they want their money back plus a bonus. In their view time escalates the property value (even if it is only a few years!). In their view prices do not go backward when it comes to their wonderful property. Well the opposite is the case and prices do go backward for all sorts of reasons. The recent global financial crisis in many countries has proven that.
Remember that you do not have to list a property just because the client wants to list it with you or your agency. Protect your time and protect your reputation. Remember that an unsold property that is on the market for a long time will impact your reputation. It is better to be known for listing and selling a few good properties than listing lots of poor listings that are overpriced.
Before you take the overpriced listing on there are a couple of considerations that you need to make given that it’s your time that will be taken in the marketing of the overpriced property. Consider these questions:
- Would it be better to let some other agent take the listing at the inflated price and waste their time?
- Can you come in later after the other agent has remained unsuccessful with the property, thereby allowing you to condition the seller to a more reasonable price?
- Will the client reduce the price quickly and soon if enquiry is low?
- What range will the client drop the price to if they are to make the property more saleable?
- How long have you got the listing for and is it long enough to match the client to the market?
My theory is that the clients are not always right when it comes to price and the way to challenge them on their price theory is to suggest that they put the property up for sale at auction. Tell the client that the auction method is the best way to get the best price that exists in the market today.
If the client is serious on selling the property and if they think their property is as good as they make it out to be, then they will not be afraid of the auction process. One final thing needs to be said here. Seller funded marketing campaigns are essential and the money for that campaign has to be paid before you start the marketing.