Wade Corbett
By Wade Corbett
How much time do you spend time researching and creating comparables for properties that you aspire to list? You then sit down with the homeowners and they have decided—in their infinite wisdom—that you should list it at a higher price than you suggested. What do you do?
Many agents will say, “Sure! Let’s list it at your price and we’ll see if it sells!” After all, we’re just happy to just add another listing to our portfolio, right? Many months later, the home is still on the market and the same sellers are questioning your ability to do your job. How many of us have shot ourselves in the foot this way?
Thankfully, there are some easy ways to avoid this situation: Continue reading »
Marianne Guenther Bornhoft
By Marianne Guenther Bornhoft
A new study just released from the Pew Research Center’s Project for Excellence in Journalism indicate that half of American adults have mobile Internet access via a tablet or smartphone. This is a major shift on how we as REALTORS® might want to review how we price our listings. Now more than ever, it is important to identify how potential buyers are using new technology to find their dream home.
At the center of this growth phenomenon is the tablet computer. The report states that nearly a quarter of U.S. adults — 22 percent — now own a tablet device-double the number from a year earlier. Another 3 percent of adults regularly use a tablet owned by someone else in their home. And nearly a quarter of those who don’t have a tablet, 23 percent, plan to get one in the next six months. In addition, 44 percent of U.S. adults have smartphones, which, according to the survey, is up from 35 percent from May 2011.
Most buyers start their home search by looking at listings online, or most often, on a real estate app specifically designed for a smart phone or tablet. This search tool allows the person to search for very detailed criteria. For example, the app will prompt the buyer to select the price grid they desire. For example, on the REALTOR.com® app, a typical price starts from a no minimum amount up to $300,000 with a $25,000 price spread between the two different price brackets. Most apps follow this rule. Some are only $25,000 between the price brackets and some real estate apps use a $50,000 price spread.
So let’s say you’re a seller and you would normally price your house at $224,999, now with the specific price brackets in mind, you might want to price it at $225,000 exactly. That way it will show up in both searches. Specifically, the search criteria a buyer might pick has house prices that go up to $225,000 or some would rather start from the $225,000 price bracket and search higher.
Remember, the real estate app only gives you exactly what you ask it to produce. So a seller might actually be losing a buyer who could afford a higher price home by pricing it out of targeted range. It would have been better if they would have priced it precisely the amount of one of the specific price brackets on the desired real estate app.
Rethinking how we expose the listings to the public is crucial as technology becomes more advanced and different ways to search for a house develop. We must learn to adapt to this change or be left behind.
Marianne Guenther Bornhoft is a broker at Windermere Manito in Spokane, Wash. Connect with her at www.SpokaneHouse.com , on Facebook at www.facebook.com/marianneguentherbornhoft or on Twitter @spokanehouse or www.linkedin.com/in/marianneguentherbornhoft.
Alex Milshteyn
By Alex Milshteyn
Unpredictability is a big part of our careers as REALTORS®. I have been selling real estate for nearly 12 years and as soon as I get comfortable with, the market the rug is pulled right from underneath me and my business is thrown into disarray.
After five years of negative media coverage on our market and a downward pricing of homes, I was used to the negativity. I was used to calling my sellers every week and not having anything to talk about other than the need to drop their price. I was used to buyers taking their sweet time with no sense of urgency to find a home. I was used to showing 50+ houses to a buyer just to get through the short list of houses meeting their criteria. I was used to negotiating the deal then renegotiating the deal after inspections then renegotiating the deal at the appraisal and then again renegotiating the deal prior to closing. I was use to apologizing for this market. And last but not least, I was use to being content with what my job had become.
Like many REALTORS®, I think we got use to the negativity and we did the best we could. I saw many friends go out of business, and the sad story is I saw some friends lose their homes like many of our clients because of this market and the economy.
All in all, what we all went through was sad. But we all knew things would eventually change. I am happy to report that the rug was pulled from underneath me once again. This time it’s for the better.
In my travels throughout the country, I am happy to report that it seems most markets are rebounding, especially in the hardest hit states like Florida, Michigan, Nevada, California, and Continue reading »
Dave Robison
By Dave Robison
The problem client:
That’s what an agent said to me over a year ago. “Dave, this client calls me a lot and is really high maintenance. Her listing price is unrealistic, we should just drop her listing.” This agent was selling 40 listings a year. He should know exactly what he is talking about right? Many sellers have pie-in-the-sky pricing on their listings and they may blame you that its not sold! Phone rings… “Mr Agent, why haven’t you sold my unrealistic high priced listing? I mean you haven’t even brought one buyer over to see it!” (Ummmm…probably because no one wants to see an overpriced listing, duh.)
Well, this seller had a hard time reaching their listing agent mainly because the agent felt like she was high maintenance and his time was better spent elsewhere. As a result, when her mother asked if she liked her agent, her response was, “Not really.”
There went $20,000 in referral commissions down the drain. The mom went and used another agent.
I took over:
Right about this time I heard through the grapevine that she wasn’t happy. The agent wasn’t happy either. So I took over. I sold her home and helped her buy another one. That client was worth $20,000 in commissions on those transactions. If she had been happy there would have been another $20k in commissions for a total of $40,000 in commissions made.
Where success comes from: Continue reading »
Cory Brewer
By Cory Brewer
Last summer, an agent in my office took on a listing with high hopes…the market in this particular neighborhood was moving fast and prices seemed to be pretty stable. Unfortunately, though, by the time the clients were ready to hit the market, some of the neighboring comps had slashed prices (assumably to try and get sold before the start of the school year). As time went on, the comps dictated that there was really no way we could sell for our asking price, which meant we were approaching the dreaded “short sale territory.” This was a major game-changer, and there were many occasions on which our clients thought it would be best just to pull the house off the market and maybe even stop making their payments.
At times we almost felt like this was going to be a lost cause, but two things came to mind: If that house didn’t stay on the market, there was no other way it was going to sell…and the sellers are in a position where they have a legitimate hardship and NEED to get out from under the house and move on with their lives. I also didn’t want my agent’s sign to come down from what is a very high-traffic neighborhood.
Long story short, the sellers agreed that keeping the house on the market truly was the best course of action to meet their goals. At press time, we are thick in the middle of a win/win situation: They have accepted an offer on the house from a buyer who is willing to wait out the short sale process and our negotiator is well underway with the lienholder in getting that approved. In the meantime, the agent received several sign calls on the house…each time knowing that there was little chance the house would sell to that caller given the short sale situation. No matter…they pursued the sign calls and are currently under contract with one of those buyers on another house nearby (scheduled to close later this month). Continue reading »
Jason O'Neil
By Jason O’Neil
March. In like a lion out like a lamb…it is one of my favorite months. Yes, my birthday is in March, but so is St. Patrick’s Day, the first day of Spring, and let us not forget about the Ides. More popular than all of those combined is the NCAA Division One Men’s Basketball Tournament, simply known as March Madness or The Tournament.
Amidst the excitement this past weekend it dawned on me that much what happens all season long doesn’t mean anything once the first whistle blows. I was drawn toward the parallels of pricing and selling a home. You see, the price of a home is a very academic thought out process that involves averages, standard deviations, seasonal adjustments and countless other adjustments. As an agent, I spend countless hours with my sellers developing a pricing strategy.
The time spent developing a pricing schedule is similar to ranking, or seeding, teams in The Tournament: strength of schedule, margin of victory, conference wins, play ins and automatic bids.
But then the game starts, the sign goes up and first whistle blows. And none of it matters.
It really doesn’t.
All the academic work to develop the pricing strategy or to see who is an 8 seed versus who is a 6 seed or if the home should be listed for $275,000 or $250,000 is out the window. Now it’s up to who, in basketball has more points when the clock runs out, or who in the neighborhood is going to get an offer on their home first. Butler is still an 8 seed, even though they beat a 1 seed. Statistically speaking, that is not supposed to happen. But the funny thing about about things that aren’t supposed to happen is that sometimes they do.
Once the sign goes up all that matters is what the buyers who are active in the market think, and more importantly how they act. At that point agents and their sellers need to pay close attention and react to the initial pricing strategy…once a home is listed the “comps” no longer matter, the only thing that matters is buyers making offer. In basketball, the only thing that matters is winning.
Go Butler!
Jason O’Neil is a broker and an owner of McKenzie Real Estate in Indianapolis. Visit his Web site: www.McKenzieListings.com
Jason O'Neil
By Jason O’Neil
Are the two at odds with one another? I say yes. I begin each buyer consultation with the simple question: “Do you want a great deal or do you want a great home?” The responses are typical:
“Both! Ha Ha Ha…I mean, can’t we get both?”
“Uhhhhh. Great home?”
“Somewhere between.”
“Great home. Good deal. Is that possible?”
Most home owners forget what they paid for their home the instant after they move their stuff in. And while most of them get a monthly reminder about how much they owe on their home, very few remember the asking price, let alone the prices of the other 10 homes they looked at before they found “The One.” The hang up on the good deal is so over emphasized that I predict it will fade in the next 12 months.
I know that there are naysayers out there, but I am having some serious deja-vu. In 2006, home sellers had the golden tickets. Price? Price had nothing to do with selling a house, heck, if you missed the mark on price the market would quickly appreciate so fast that the market would catch up with the price. Sellers didn’t have to negotiate and buyers were at their mercy. My how the tables have turned. But have they really? I am starting to see the same type of overreaction in buyers. I had a buyer ask the seller to fix the neighbors house during an inspection negotiation!
Sellers are saying enough is enough and our market is normalizing. The great homes sell and sell quickly for close to their asking price…some get multiple offers. The homes that languish on the market are the ones that have been over looked, or been rejected by other buyers and the market as a whole. Do you want a great home or a great deal?
Jason O’Neil is a broker and an owner of McKenzie Real Estate in Indianapolis. Visit his Web site: www.McKenzieListings.com
By G. M. Filisko, contributing writer, HouseLogic
In today’s market, cleaning a house about to be listed isn’t enough to cop a higher sales price. To boost your listing’s appeal, share the free “Pricing and Prep that Sells Your Home” article package from the REALTOR® Content Resource.
Just two of the tips you’ll find there:
1. Have a home inspection. For $250 to $400, an inspector will warn you about troubles that could make potential buyers balk. Advise clients to make repairs before putting the home on the market. In some states, you may have to disclose what the inspection turns up.
2. Get replacement estimates. If your home inspection uncovers necessary repairs your client can’t fund, get estimates for the work. The figures will help buyers determine if they can afford the home and the repairs. Also hunt down warranties, guarantees, and user manuals for appliances you expect to remain with the house. Continue reading »
Brian Copeland
By Brian Copeland
I love reading warning labels. One of my favorites is “For external use only,” which has been spotted on numerous curling irons. Another favorite is on a child’s Halloween superman costume that says “Wearing of this garment does not enable you to fly.”
Wouldn’t it be great if homes came with warning signs posted with the true warnings that buyers may need to know? Here are some of the signs I’d recommend.
“Warning! This house is overpriced by $30K because the seller has been under a rock for the past 18 months.” Real estate practitioners carry the power to prevent this label, but find that getting the sign in the yard, getting the bragging rights that he/she “won” the listing, or getting to put it in an internet lead system to get more buyers is more important than being honest with the seller. The same holds true for a buyer’s agent who is too concerned about a paycheck to pull true comparatives for a buyer.
We have the responsibility to point out the pricing warning sign to today’s buyers and sellers. We need to tell sellers, “Oh, and by the way, if you think that you should price it higher because you need negotiation room, you may not see any showings and your home may become stigmatized as a stale home. This could cause buyers to question their ability to resale the home in the future.” As a buyer’s agent we should pull comparatives for every home that has landed in the client’s top five for consideration before going to contract.
“This house is lipstick on a pig.” It’s one of my favorite pulled quotes that the local CBS affiliated pulled out of an interview they did with me when I THOUGHT the camera was off. It holds true though. Some renovated homes are pretty, cosmetic make-up put on a trash of a structure. Be super cautious of renovated homes. If someone is renovating homes in this market, likely they are smart, conscientious and know what they are doing. Only the best try this buy, remodel, resale market of 2009 and 2010. Continue reading »
Dave Robison
By Dave Robison
How many times have your clients or friends asked you about your crystal ball? My clients ask me all the time. It’s almost daily you hear, “If I buy this house, how much do you think it will appreciate in the next 2 years, or 5 years?” or “How much more money will I make on my house if I wait a year to sell it?” Practitioners need a new core course to renew our licenses titled, “Gypsy 101,” or “Palm Reading 201.” Or you can just read this blog entry and you can become pretty good at being psychic. There are two parts in being psychic right now to know what is happening with the market: know how to price listings, and to know what to tell your clients.
First, you must follow the rules. In 2006 when the market was booming in Utah, there were numerous people that came to me and asked, “Should I buy this home? All I have to do is use my credit and flip it the next day.”
Many of you now are thinking, that’s common sense. But then it wasn’t. It was very enticing, someone’s friend just made $100,000 doing one flip supposedly. I asked 2 questions. Continue reading »
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