Three tips to help show your seller why they should adjust their price.
Every homeowner wants to get the most money for their home when they list. They’ve paid for the mortgage for years and probably have most of their savings tied up in their property. The sale of their house can have a direct impact on the quality of life they will have in the future.
However, real estate can be very volatile. A short while ago, our market heavily favored sellers. They could put up whatever outrageous price they wanted and still expect cash buyers to come flocking in with offers that were way above the asking price.
Now, that’s no longer happening. Interest rates have reached around 7%, and this has affected affordability. As a result, buyers have become more selective—they want every dollar they spend on the property to count. If your seller sets the price too high, there’s a big risk of their house sitting on the market for too long. As their agent, how can you convince them to lower the price? Here are three things you can do when talking about price reductions with your clients:
1. Manage their expectations. This should be a conversation that you have at the initial listing appointment. Before you even sign papers, you need to let them know your expectations of whether a price reduction is needed. I like to discuss price reductions every 10 days.
2. Maintain constant communication. Let them know that this market changes every single day—it is not the same, constant market each day. Things change, and when something sits on the market for more than 10 days, a price reduction has to be discussed.
3. Find the correct price adjustment. How much of a reduction is enough? I think that nothing less than a $10,000 reduction is worthwhile. If you have someone interested in your listing and you reduce it by $5,000, they’ll just sit and wait until it’s priced lower.
Price reductions can be a tricky subject; agents have to broach this conversation strategically. By following these three tips, your seller will be more agreeable when asked to lower the price and will feel more involved in the process, thereby easing some of the burden on you. If you need more help on how to talk to your clients about price reductions, call or email me. I’d love to connect with you.