Repositioning Properties In A Changing Market

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