how to counsel a seller through a changing market Archives

Repositioning Properties In A Changing Market

Wade Webb on August 3, 2022

Ever wonder what the best strategies are for repositioning properties in a changing market? Now this isn’t really about getting new business. It is not a prospecting script, but it may be the most important phone duty that anyone in your office does–asking for price reductions on listings. Asking for price reductions can make or break a top real estate agent’s business. Not only will price reductions quicken the sale, and therefore, minimize overhead in a real estate agent’s business, but it will also prove to everyone your marketing systems work. Remember, price is 90% of any marketing plan and the faster you achieve market value, the faster everybody’s needs are met.

The challenge with price reductions is not solved with a phone script, but a series of planned events. This system you are holding shows you the right questions to ask prior to a listing presentation so you can learn their true motivation and then find ways to meet their goals. When the desire is to meet someone’s goals, they’re much more likely to listen to the plan that gets them there. As we all know, the correct price is the fastest road to the achievement of most goals that have to do with a sale.

Once the right questions are asked, the next step is an outstanding presentation with the correct verbiage during the CMA. We’ve all experienced the seller that no matter how much information is given them, including pre-listing sales packages that include pricing technologies and the right scientific research showing the exact value of their home–they still want more! What are we to do? What to do while battling another agent’s high evaluation or how to obtain pre-agreed listing reductions during the term of the listing. All I can do at this juncture is to assume the right questions were asked prior to and at the listing presentation, and they received information on how to price their property correctly. At the listing presentation this information was gone over and the scientific information was discussed. If after all of this has been done and the price is still too high your options are to not take the listing or to receive pre-agreed reductions based upon the success of marketing.

All this leads me to believe, if everything that should be done has been done, and you still have an overpriced listing, you (1) knew it was overpriced and took it anyway or (2) made a mistake based upon the fact you liked the property more than anyone else did. There’s also a possible third problem and that is the seller was a better salesperson than you, and sold you on the high price. All this is leading us to one conclusion, if you have been a victim of any of the previously mentioned three problems, you’re now going to have to consistently ask for price reductions, which may be the most embarrassing aspect of this business. How do you ask for price reductions when you told the seller you could market the home at the agreed upon price? Sometimes, their responses are furious, such as, “Well anybody can sell this house at that price,” “The other agent said that they could get more,” “I can’t buy my new home if I get that price,” or “Do you expect me to lose money?” All these questions ignore the main subject, and that is, market value is market value and none of the above questions have anything to do with or affect market value.

The following lead-ins can be used to ask for a price reduction, but it is very important you use new subjects as often as possible, so not to sound monotonous! Remember, an agent who asks for price reductions soon after the listing presentation will have a weary seller, so therefore, mix your price reductions with new and exciting marketing concepts. Concepts such as a page promoted on your website from your lender showing five ways, which the home can be financed. Adding a special home of the day button to your site or sending your evaluation surveys to all the agents who have seen the home– I’ve got a million of them. Remember, the seller likes the real estate agent who is ingenious in their marketing methods and also, the seller will then listen more intently to the following reasons for a price reduction.

Lead-ins to Ask for a Real Estate Listing Price Reduction

1. There’s been a new sale in the neighborhood that affects your value.

2. Here are some of the responses we’ve received from other agents.

3. Here are the responses I received from buyers I have shown.

4. Here are responses I have heard from buyers shown by other agents.

5. Here are the responses from the agents in my office.

6. Here are the attitudes of the real estate agents who attended the Broker Open House.

7. Here were the attitudes of the buyers who walked through your home on the open house.

8. Here are the responses we have received from the ad that we’ve placed in . . .

9. Here are some suggestions I would do if it were my home to make it more appealing to buyers. Oh, by the way, rather than just making these improvements why don’t we drop the price to compensate for some improvements the buyer may want to make?

10. Why don’t we increase the selling office commission? If I sell it, I will stick to the original terms of the listing agreement.

11. May we add a selling office bonus?

12. May we add points so financing becomes easier for a buyer?

13. I know this offer was low and the buyer did not accept our counter offer, however, may I lower the home to the amount we mentioned in the counter offer to attract more interested buyers?

14. May we ask for some concessions on the home you’re buying and then supply those same concessions to any potential buyers on their home?

15. May we offer preferential owner financing and make the property more affordable to any potential buyers?

16. We have an open house / new ad / new internet blast going out and I would certainly love to be able to market this home at a new and improved price.

17. I’m going to be taking the property out of the MLS and resubmitting it as a new listing, therefore, acquiring a new look and new enthusiasm among the cooperating real estate agents here in town. I’d like to do that at a lower price.

18. Is there anything we could throw in that would sweeten the pot, appliances, vehicles, maybe even a free vacation at a time share?

19. Many times we have found emotions play a big role in the sale of a home. Therefore, can we make your home more emotional by having it professionally staged and decorated by a local design group?

20. Cooperation among real estate agents is paramount to getting the property sold. Yes, I am the one agent that is handling the marketing, but I am marketing to more than 3,000 real estate agents who handle a large percentage of buyers. My job is to market to them so they can express their excitement of your home to their buyers. Let’s discuss what we can do to make this home more exciting to the real estate agents here in town.

21. Real estate agents have many properties to show and sometimes the determining reason for showing is ease of access. Let’s do some items to improve the showing procedure to make it easily accessible to real estate agents at any time and at a moment’s notice.

22. I would like to obtain a price reduction and do some things I have never done to market a home, such as advertising them in the Los Angeles Times and the Wall Street Journal. Spending money on an ad that would reach outside our geographical area is risky, but I would be willing to go ahead and give it a try if we had a more marketable price.

23. I was looking at your holding cost and found if we drop your price and obtain a sale, we may eliminate many months of payments, taxes, insurance, and upkeep I believe would compensate for this price reduction. Let’s discuss how this might work.

24. In all the years I’ve done business, one of the hardest things I have to do is disappoint a client. The continued marketing of this property at the current price that I now find is too high only tends to disappoint you and therefore, I’d like to ask the following favor. Would you please consider a price reduction and if that’s impossible, would you allow me to discontinue my marketing efforts? It’s very difficult for me to express this to a seller that’s been fair with me and to a home I’d like nothing more than to market and sell; however, I truly believe unless we drop this price, the property will go unsold. I’m willing to give up my marketing effort and my listing to show you how clear I am we need to adjust our price today.

I hope you can use any one or all of these reasons to obtain a price reduction or improvement in terms or value. The phone is the most effective way to do this. The use of your assistant calling for price reductions or doing it by mail has proven to be ineffective. There are times when the real estate agent must pick up the phone, and the price reduction is one of them.

Strength and courage,
Wade

Seller Counselling Strategies for Realtors© 2022

Wade Webb on June 22, 2022

In the early 90’s when I first started in the real estate business it seemed like every seller counselling session for Realtors© I had for the first five years of my career was about Mr. And Mrs. Seller paying too much, needing too much or wanting too much. N.A.R. reports that around 80% of people don’t use the same real estate agent more than once because they never hear from their agent again after the sale or after giving the agent their listing. Another common reason we hear is “We felt our real estate agent really didn’t do that much for us.” When we are getting paid a large sum of money for our services, isn’t it fair for the seller to expect some kind of advisement and service throughout the process before, during and after?

Seller Counselling… Top Tips of Advisement and Service During Their Home Sale

Establish a plan – clearly set out for the seller the level of communication they can expect from you throughout the process. Then exceed that expectation. Kill them with communication.

Don’t focus on their price, rather focus on the 5-6-7 technique to help you and your client determine what their hot button for selling truly is. All of us are motivated by either pain or pleasure. How many of us have asked our sellers a minimum of 7 deep questions to find out their true desire for moving? It is always about something they are running to or running from and they consistently need to be reminded of that pain or pleasure button. That is how we “move them” to want to sell and not choosing to stay.

When nothing is happening, this is the time we communicate even more! How many of us have nothing to say and therefore just choose not to communicate with our seller? There is always something to say… you just need to find it.

Prepare and educate the seller in advance of the paradigm shift in virtual showing vs. the physical showing in today’s market. With the use of modern technology we are able to qualify even better than before and allow the buyer to virtually tour your home and not have to waste your time with so many physical showings to find the right buyer. Saves you from them getting upset about having fewer than expected showings.

Show them your system for pre qualifying the prospect. I truly believe they hire us to market to cooperating agents who have the buyers and qualify them and qualify any other buyer before they enter the seller’s home. I would show the seller a list of questions I would ask to prospective agents and buyers qualifying them prior to viewing their home.

Have them come in weekly, bi weekly or worse case scenario 3 weeks and sit down to discuss online activity like website traffic. Share with them all the marketing that has taken place in the past and what is planned moving forward in the future. Discuss sign calls, ad calls and any other leads that have been generated on their home from your marketing efforts.

Review a classic sales tool from my mentor Floyd Wickman called the Saleability Checklist. Every week share with your seller a creative idea or two that they could possibly implement to help their listing become more saleable other than lowering their price from this fantastic checklist. They hired you to be the creative marketing expert and dropping their price is not what they had in mind. For example, suggest to them a technique from the list called a “Dutch Auction” where you would agree to create a market buzz by pre signing price reductions for every week for an agreed upon amount until the home is sold. Buyers become interested in the listing watching the price drop week after week until finally a buyer pulls the trigger before they feel it sells to someone else first. Although a Dutch Auction involves asking the seller for a price reduction, this technique at least is actual creative marketing that can create a buzz and interest around a property. If explained properly this can offer the seller hope and get them excited again, whereas simply telling them to drop their price is frustrating and discouraging. (Click on this link to download a copy of our Saleability Checklist)

Take the seller and play the game my mentor David Knox taught me “The price is right”. You tell them you are picking them up for a ride and that you are buying coffee and dessert. Drive them by the 3 most recent sales similar to theirs and read them the feature sheet and show them interior photos but don’t tell them the sale price and let them guess the final sale price for each. Then take them to preview the top 3 homes for sale that compete directly with theirs and again don’t let them know the asking price until you come back to the car. After the 6 homes and the price is right game then go for coffee and desert and discuss how they feel their home compares to what they just saw.

My final tip is to review all this information and really deliver value to the seller in all your seller counselling sessions during the listing period. I always ask them these very important questions…

1. What do you think we should be doing different?

2. What should we be doing next, moving forward?

3. What are we waiting for and why are we not doing anything about it?

I then pull out 2 forms and a pen. One paper is a price reduction form and the other a listing cancellation form. I explain to them that I cannot afford to disappoint them and fail them at selling their home and I need them to either reduce their price or release me of my responsibility of selling their home.

I hope you find these tips and the checklist incredibly helpful with your seller counselling in 2022 and begin to sell more homes and not just list more homes. We are in the business of selling homes and not just listing them and you want to be known for the selling.

AgentsBoost – Saleability Checklist

Strength and courage,
Wade

Secrets To Seller Counselling During Market Shift

Wade Webb on July 4, 2018

We are beginning to see a shift in many real estate markets across North America. The importance of knowing how to counsel a seller through a changing market is something many Realtors© need to learn how to do properly. As the homes begin to take longer to sell, activity lowers and the competition increases the importance of a consistent process managing listings and sellers is key. Let’s look at this 10 step process and begin to manage our listings and sellers expectations before they consider firing us.

How to Counsel Home Sellers in Market Shift

#1 – HOT BUTTONS, You Must Know What Your Seller’s Hot Button Is. The only thing that moves their emotional meter is the avoidance of pain – What are they running from? Or the gain of pleasure – What are they running to? Take the time to question them 7 questions deep to identify their hot button. “Why do you want to sell?” “So why is that so important?”…… Identify the hot button and remind them of the outcome if they chose.

#2 – CREATE A PROCESS, “wing it” and get “wing it results”. Implement a plan to manage the sellers expectations. The most powerful way to manage their expectations is with education and communication. It is now time to become their trusted advisor and not the time to hide and not be proactive. To them your silence is deafening and they blame us for the market.

#3 – ESTABLISH PREFERRED METHOD OF COMMUNICATION, we can’t assume the method we choose to communicate with our sellers is the method they would choose. Sit down and ask how they would like you to communicate with them? Phone? Text? Email? FB Messenger? Face to Face? Set the expectations for communicating and make note of the method in your process.

#4 – ESTABLISH FREQUENCY OF COMMUNICATION, we can’t assume the amount of communication we choose to connect with our seller is what they hoped and wanted. Sit down and ask how frequent they would like to hear from us. Remember to make note of it and then over deliver and not under promise that frequency. We are in the customer service business, right?!

#5 – CREATE THE SIMPLEST SHOWING PLAN, we need to take time and educate the seller on the importance of an easy showing plan for their property and the importance to them getting the physical activity they want and expect. Set the showing plan so it is easy and not an Indiana Jones adventure to try showing their home for the selling agents. Take the time to explain to them paradigm shift of virtual showing activity of their home and how it has taken over for physical showing activity of their home thanks to internet, drones, photos, video and interactive floor plans.

#6 – EDUCATE THEM ON QUALIFICATION, other than MLS, marketing and negotiating the most important skill they hire us for is our ability to qualify the perspective buyers considering their home and eliminating the time wasters. Share your list of qualifying questions with them that you use to question the public and the list of questions you use for qualifying the co-operating agent and their buyer to ensure the best of the best are physically viewing their property. This also helps us deflect the issue of no physical showings in a slower market because they think we are doing such an outstanding job at qualifying!

#7 – SHOWING FEEDBACK, is always something that can hurt any listing agent and their relationship with their sellers. Have a system to get showing feedback from selling agents. Have a system to give showing feedback to your sellers consistently and agree on that system together. Pick a set day? Time? Remember even just a call saying you tried multiple times to get feedback from the showing agent and have to assume no news is not great news, but we tried is better than not calling them at all.

#8 SELLER COUNSELLING REPORT, is a vital tool to managing the sellers and their listings. Pick a set day and time during the week to report to our sellers. Create and deliver a weekly or bi-weekly report by email, postal mail or better yet hand deliver it. Remember to kill them with communication ( sample seller report – Attwater report May 6th ) Items you should include with your reports:

a) Auto emails of new listings, sale and expired listing alerts to the sellers
b) List of your ongoing marketing activities you presented them at the listing presentation ( they forget )
c) Local Board Market Stats
d) Local real estate related media reports
e) Showings – Feedback comments
f) Sign calls, Ad calls, Email enquiries
f) Salability checklist ( one marketing idea a week ) something other than dropping their price to change up the marketing. (AgentsBoost – Saleability Checklist )

#9 – 21 DAY FACE TO FACE OFFICE MEETINGS, you schedule every 21 days a face to face meeting at the office to review the previous and upcoming weeks activities on their property. Remind them of their hot buttons. Ask them what they think we should do different? Next? What are they waiting for? Why are we not repositioning the property? It is good face to face time to lean into your sellers and act like a trusted real estate advisor, hence them coming into your office for the meeting.

#10 – THE PRICING PROCESS, we all know any price will cure any property or market problem. Consider at the initial listing getting a pre signed price reduction at time of taking the listing to allow you to reach out to the co-operating agents and their buyers to notify them of the change in price within the first 14 days of the listing to avoid losing those buyers to other properties. Consider ordering a third party bank appraisal to help with pricing. I always like to physically bring my office pricing team of 6 agents to view and write their estimated sale price on the back of their business card. One last tip is remember as a listing agent we can always prepare with our sellers a reverse offer (seller initiated) for that agent and buyer just lurking for days in the bushes!

So there you have it! A simple and powerful 10 step process to excel as a listing real estate agent and deliver excellence to your clients in the midst of a changing market. I hope you can implement and execute this system and take your business to another level.

Strength and courage,
Wade