Telling Sellers What They Want to Hear — Initially
It doesn’t happen to me that often, but — believe it or not — there are occasions when I interview for a listing, and the would-be client decides to go with another Realtor.
In fact, I fielded a phone call informing me of that news earlier this week.
“Your credentials, track record, and references were all excellent,” the would-be home seller told me.
“However, the other Realtor agreed to price our home $100,000 higher than you would.”
“And, as we mentioned when we met . . . we really don’t need to sell.”
“Buying the Listing”
Realtors call landing a listing by quoting the highest price “buying the listing.”
Just like what it sounds like, it involves “outbidding” any competing Realtors by agreeing to take the listing at the highest price.
The catch, of course, is that that price usually bears no connection to market reality.
So, what happens next is usually . . . nothing.
There are few showings, and the showings that do occur generate uniformly negative feedback.
Market time accumulates, and eventually it’s obvious even to the home owner that the price needs to be cut to stimulate interest and attract a Buyer.
Ahhh . . . . but when the Realtor raises the issue of price, what is the owner’s response?
“We really don’t need to sell.”
Corollary to “We Really Don’t Need to Sell”
Which brings me to the corollary to “we really don’t need to sell”:
“We really don’t need to cut our price.”
You can tell which homes fall into this category by doing a cursory search on MLS for homes that have been at the same price for more than 200 days — 100 days for a more modestly-priced home.
(Note: the other explanation for a “stuck price” is that the homeowners can’t afford to reduce the price, because that’s what they owe on the home, and taking less would result in what’s called a “short sale”.)
Eventually, what usually happens in such cases is that the listing simply expires.
In the meantime, the listing Realtor has their name in front of the house — free marketing! — and may even pick up a Buyer (or three) doing the odd open house at the overpriced home.
Then, one year — or five years — later, when the Seller’s circumstances have changed and they truly are selling, they’ll interview Realtors again and hire the one who — in addition to having impeccable credentials — gives them the most credible pricing guidance.
P.S.: Another corollary to “we really don’t need to sell?”
“We really don’t see the point in staging.”
