Yesterday, in group coaching, we were talking about the sluggish market and the adjustment of prices we’re seeing now. Likely, we will continue to see this through the summer, fall election and into 2017. That means we all have to become experts on price adjustments and – more importantly – pricing property the right way from the start. Here are a few key tips to help:
- Bring the Market to Every Conversation. Stop opinion-based conversations. Explain that there are three entities involved in the discussion – the Realtor, the Seller, and the Market. What the Market says is most important. So bring with you the statistics that show what’s really happening. I like the Board of Realtors Market Reports which quickly demonstrate a year over year comparison (see below). Remember, no adult likes to be told what to do. They have to come to conclusions on their own. Your job is to share accurate Market data and facts with them, and then ask, “Based on what you’re seeing here, along with the sold comparables, what price do you think we need to put on the property to get a buyer to choose yours over the competition in today’s Market?”
- Always tie Motivation to Price. Start by asking the seller, “One a scale of 1-10, 10 being the most motivated, how motivated are you to get the property sold?” Be sure you know what’s causing them to sell and where they are going next. Tie those emotions to any and every pricing conversation. For example… if a Seller wants to have a fall home in the mountains of North Carolina and they’ve told you they love the peace & quiet, the cool temps & fall leaves, then reflect on that! Perhaps restate it by saying, “So your peaceful life plans- the ones that would allow you a better quality of life – are completely on hold until we sell this property, is that correct?” Then connect time on the Market to price.
- Be Ready for Objections. One of the most common is, “Well I paid $X for the home, so I want more than that now.” Always repeat and validate what they want before handling the objection. “So, you want more money than you paid; I can understand that. And at the same time, we can agree that the real estate market isn’t still, it’s always moving up and down, right?” <<yes>> “Similar, in fact, to the stock market, isn’t it?” <<sure>> “So what we’re essentially saying is, you want more money for the stock, even though the market valuation is lower. That’s like saying Disney stock was $3 per share in 1949 and I want that deal now… does it work like that?” <<no>> “Exactly, we have to price the property for the market snapshot that we see today.” A second common objection you may hear is, “The __________ News said the market is increasing!” Again, always repeat and validate. Then handle the objection like this. “Mr. Seller, the market is just starting to correct now after 6 years of price increases. So let me ask you a question… what happens first – the car accident, or the news reporting the car accident?” <<the accident>> “Of course! And those at the scene know about it first, right?” <<sure>> “I’m a Realtor who is at the scene of the Market and knows what’s happening today, and I’m giving you the benefit of knowing that information first. Surely, we will use it to our advantage, right?” <<yes>>, then go after the proper price.