Welcome back to America’s #1 Daily Podcast, featuring America’s #1 Real Estate Coaches and Top EXP Realty Sponsors in the World, Tim and Julie Harris. Ready to become an EXP Realty Agent and join Tim and Julie Harris? https://whylibertas.com/harris or text Tim directly 512-758-0206
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Secret #1: A great Listing Pre Qualification Script pulls out critical facts so you can be best prepared to not just take the listing, but to price it right in the first place! Not prequalifying is unprofessional and can waste your time and theirs. Always prequalify, 100% of the time! Price it to SELL, not to SIT.
Secret #2: The best price reduction conversation is the one you never have to have. All pricing scripts are best used at the listing table!
Secret #3: Don’t lose the listing of a motivated, have-to-sell-seller over price. If they HAVE TO sell, you HAVE TO take the listing! Someone is going to make a commission. Shouldn’t it be you?
Proper Previous Planning Prevents Pitifully Poor Pricing!
Don’t Go (To Your Next Listing Appointment) Unless You KNOW:
1. Don’t Go If You Don’t Know: What the Seller wants, needs or thinks it’s worth. Pricing the home correctly in the first place prevents future price reduction drama. It’s not unusual for a homeowner to believe that their home should fetch a price higher than the comps. You should always find out how they arrived at ‘their’ price. Find out before you arrive at the appointment so you can better strategize, explain and consider how to ultimately price the home.
Script: (when they tell you a too-high price): “That’s interesting, Mr/Mrs Seller, how did you arrive at that price? (listen carefully)
Secret #1: Sellers overprice out of either Ignorance or Arrogance. Even in a hot seller’s market, there is ‘aspirational pricing’…you can price too high. Ignorance is when they just don’t know how to price a home (square feet matters, bedrooms, baths, views, condition). Arrogance is when they won’t listen to comps and have reasons other than real value to try to justify their price.
Secret #2: Sometimes, especially in a low-inventory market, your potential seller client may know about comparable sales you didn’t capture. Private sales, For Sale By Owners that were successful in the neighborhood, and other sales not found in your MLS could be really good comparables, so ask good questions and don’t assume your seller is just crazy over priced.
2. Don’t Go If You Don’t Know: The Average Days on the Market for properties like your subject property. This helps set both your expectations and the home owners. Not just for your town or even zip code, but for their neighborhood, school district and MLS code. Drill down as best you can to understand the Days on the Market for homes as similar to theirs as possible. Sometimes even the style of the home can make a difference.
3. Don’t Go If You Don’t Know: The List to Sell Price Ratio. This helps you combat the ‘price it high, let them negotiate’ objection –or- helps you know if you can price it right on the mark and expect to get slightly more. Are homes selling on average for 105% of list price, or are sellers in the subject neighborhood typically settling at about 95% of list price?
4. Don’t Go If You Don’t Know: Know the number of homes competing with your subject property. What are you up against? How would it compare in the eyes of the buyer? If you’re showing your new listing versus its competition, do you look priced right, over priced or priced so well you’d be dying to write an offer and snap it up?
Secret: If you’re the only home on the market in the entire zip code or MLS code, you can price it higher than you can if there are 7 other competing homes, all within the same neighborhood, basically the same size and age? In that case, you need to be staged better and priced better than your competition or you’ll be the one who’s stuck doing price reduction calls in about 60 days.
Secret: The next time you have to do Continuing Education, take an Appraisal class. This will help you become more confident in your pricing. It will show you multiple ways of arriving at the correct price. Caution: Don’t just use ‘cost per square foot’ to arrive at the right price!
5. Don’t Go Until You Know: If there is new construction in the area that competes with your potential listing. Remember when builders provide in-house financing they often can sell a more expensive home for the same payment as your resale. If there are new homes going up, be certain to visit them, tour them and understand the builder perks and financing before you go to your listing appointment.
Secret: A resale home for $350k may be competing with new construction as high as $500k if the builder has buy downs and in house financing with incentives that reduce the mortgage interest rate down by a percentage point, or even two. Know what’s going on with new construction! Have the new build sales people explain their different mortgage plans to you. Ask lots of questions, including…what happens when they have build clients who need to sell their old house???
6. Don’t Go Until You Know: What the seller’s time frame is. Ideally, when does this need to sell and close by?
Secret: If they don’t actually HAVE a time frame, you may have a problem! The less motivated they are, the higher they may wish to price it…recipe for a tough relationship.
7. Don’t Go If You Don’t Know: What is motivating the sale? When you know why they want to / have to move, you can use this to stay on task during the appointment, referring to their needs and making it more about them than about you. This can also greatly affect your pricing strategy. If they are closing on a new home in 60 days, your strategy will be different than if they want to sell first, rent for a while and then decide what to do later. If you don’t find out, you’ll be left guessing, and guessing is NOT a strategy!
Secret: You can actually win a competitive listing situation by simply asking and then focusing on exactly what the seller really needs. Be the one who is their problem solver, not the agent who assumes they know everything. Sellers appreciate attention to detail and focusing on their needs.
8. Don’t Go Until You Know: Are they listing AND buying or just listing? Is there a referral needed for where they’re moving to? Are they already in contract on something? Is there more than one transaction for you to help them with?
9. Don’t Go If You Don’t Know: What happens if it doesn’t sell or if they don’t get ‘their price’? Is keeping the house an option? If they’re thinking about perhaps turning it into a rental property, you should do your research about what a home like theirs is actually renting for. Can they break even or make money on the potential lease payment, or would they be losing every month? You can see how it would affect your strategy and pricing.
10. Don’t Forget To Ask: How did they happen to call you? Track your sources of business. Tracking where your listing appointments are actually coming from will tell you what’s working; do more of what’s working and less things that are speculative and costly.
What’s the bottom Line? Don’t go to any listing appointment without having the answers to the ten points we discussed. Knowledge equals confidence. Ignorance equals fear. You’ll present more confidently and walk away with not only the listing, but also the seller’s trust that you’ve got their back. Start out the relationship right if you expect to have a great relationship, including repeat and referral business!
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