Tips and Tools to Help You Get Your Home Sold

If you’ve spent any time reading this website at all, you know what a huge advocate I am of professional photography on every listing that I have.   But there is something else that as seller, you must be aware of in a your new listing:  the photos must go in the moment your new listing is online.

Why?

• Agents are constantly looking for their buyers.  If two listings come up at the same time, one with photos and one without, which one do you think they are more inclined to take notice of?

• Buyer Online Searches (this is the critical point):  In the age of information, the internet dominates a large majority of buyer’s home searching efforts.  Many serious buyers are on a automatic delivery system for new listings.  When your new listing comes to them without photos, they often ignore it.  Putting in fabulous professional photography a week after it is listed is meaningless.  Too many buyers have ignored it and may never return to see those wonderful photos.

There are instances where there is a sense of urgency and a need to get the property in the listing services immediately.  In this case, I recommend using the agent’s digital shots temporarily.  I still would never recommend going without and fortunately, in this day and age, there is absolutely no need to go without photographs.

In my mind, this failure is the ultimate breech of a listing agent’s duty to their client - that seller.

When interviewing listing agents, ask about the process they utilize.  Will they have photography professionally shot?  Will they take the time to wait for those shots prior to listing?  Will they use those images in all the initial launches online?  Or will they list your home and add photos in a few days?

You know you have a good agent when they are willing to take the necessary time to prepare your listing professionally with the marketing that is needed.  Waiting a few days and going live with really quality marketing can actually create a quicker and higher sale.

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Today I received a note from a seller, Victoria, asking a tough but great question that I wanted to answer here:

How do you overcome a consistent buyer objection that is impossible to change?  Our house has been on the market for 13 days and people rave about it, but our kitchen is on the second floor and that seems to scare people off. Is there *anything* that we can do?   I’ll brag a bit - our house looks pretty freakin’ great compared to others for sale in our neighborhood.  This is us.

We’re doing a price drop today .. unfortunately, our neighborhood has been blighted by foreclosures. That said, one potential buyer loved the house, didn’t object to our price, but balked when she brought her hubby and he had a problem with the kitchen being upstairs. (They say that we’re still on their list, though.)

Objection Versus Condition

It’s critical to identify the difference between an objection and a condition.  Objections are things you can do something about - paint color, wall paper, landscaping.  Conditions on the other hand are things you can’t change - street noise,  floorplan, yard size.

Victoria’s kitchen location in this case falls under the category of a condition.  The only way to address a condition is to find ways to minimize the impact - a fountain to minimize the impact of street noise is an example.

What can Victoria do?  Based on what I can see from the photos (kudos to the agent for lots of good photos), the home is nicely staged and the kitchen looks beautiful.  What specifically seems to be the trouble with the kitchen upstairs?  What is the core of the trouble for a buyer?  Find ways to get to the core of the concern and try to address it but obviously nothing will change the fact that the kitchen is where it is.

When you have a condition such as this, having good buyer traffic is key.  You must find the one buyer that does not mind the location of the kitchen.  That buyer is out there.

Pricing Trick That Works

I noticed the price is $455,000. I’m not sure if this is the new price or not.  I will admit that I’m entirely unfamiliar with pricing in Annandale, Virginia, but I do have  one suggestion about pricing; reduce it to $450,000 - exactly.  Why?  Notice the search engines buyers use.  Many of them are set up to search in $25,000 increments.  With the price at $450,000, if they search $400 to $450 this home comes up. If a buyer or agent searches from $450 to $500, again, this home comes up.  The small pricing strategy can make a big difference in buyer traffic.

The other benefit of this pricing strategy is that the more this home looks like a great deal, the more excitement you will have on the part of the buying community and in this economic climate - with the foreclosures setting the tone for a community - it has to be seen as a good deal.  When a home is a seen as an opportunity, it also makes it a little easier to overlook conditions that might otherwise be an issue.
Victoria - keep us informed of your progress and all the best to you.  Hang in there.  I know 13 days feels like an eternity as a seller but it’s early.  Your home is lovely and I don’t think it will be long.

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I came across an article in the Orange County Register this morning that had some good tips regarding the selection process for finding a real estate agent from Stefan Swanepoel, author of Swanepoel Trends Report and RETrends.com.

One of the things Stefan noted was finding someone that had “marketing skills as they relate to reaching the consumer – not just a Website and an MLS link but proactive communication involving social networking and third party marketing avenues.”  This is certainly something new and I would agree that social networking and online connections have become a major player in the successful marketing of a home.

I would add the following:

• Ask to see copies of their 3 most recent listings - note descriptions and photography.
• Google the names of the agents you are interviewing.  You’ll find a lot out about their ability to market effectively and about their local knowledge
• Probe during the interview to make sure they have a depth of understanding of not only the market, but how the current economic climate may impact a decision to purchase or the ability to sell.

Pay attention to your gut.  My belief is that your gut will tell you a good deal about a person and sometimes a successful transaction is due in part to the ability to feel comfortable talking to the person who is guiding you through the details of this important process.

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One thing that I harp on here is the need for professional photographs in a listing. There is no listing that should ever be without them. I am a Realtor - I am not a photographer.

Recently I took some shots of a new listing of mine.  Notice the dramatic difference between my shots and the pros.  I realize this confirms that I’m not a great photographer, but I hope it also illustrates the point.  A professional will understand lighting, they will have the wide angle lens necessary, and they understand the best angle for the shot.

Based on some of the crummy shots spread across the Internet and the MLS, I think it’s fair to say that Realtors should not be shooting their own listings.  Part of an agent’s job is to market a home and in my mind, good marketing begins with great photos.

(Click on the image for a larger view)

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If you live in an area that has planned communities and tracts, it’s easy to study the comparable sales for your area to assess value and pricing.  In Orange County, it’s the first place I go when trying to determine a price for a listing.  But don’t fall into the trap of thinking the homes in your tract are your competition - it may be the tip of the iceberg.

I see it all the time.  I hear the same comment from struggling sellers:

• We’re priced $x less than our model down the street.  We are the best deal in here.
• If you look at all the homes on this side of the freeway between ‘blank’ and ‘blank’, we are the lowest price.
• We’re the nicest one in the neighborhood.

All of this may be true, but it fails to take into consideration one valuable piece of information.  Buyers rarely look in one specific tract. They rarely give themselves the same guidelines for assessing value (between ‘blank’ and ‘blank’) that a seller does.   Buyers are often looking in several tracts within a city and they may be looking at more than one city.

So when you are trying to price your home, you want to look at the following:

1. Your individual tract.
2. The available properties in your city. This is a truer representation of your overall competition.
3. The sold homes in your city.  What was the list price and what were the sale prices?  How many days were they on the market?
4. Surrounding areas and the active inventory that might be competition for your home.  Often an agent will know what other cities would be competing for buyer attention.

Pay close attention to what is selling.  The homes that have sold indicated the price that a buyer is willing to pay.  Homes that are currently on the market are not going to give you any real indication of value.

Remember, buyers are looking for a reason not to buy.  When they go look at 8 homes in a day, your home has to stand above all the others.  It can’t be forgettable in comparison.  When in doubt, ask your agent to show you the local competition.

Good luck and don’t hesitate to let me know if you have questions.  I’m here to help - no obligation. 

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If you have uttered these words, “They can always make an offer” as a justification for not doing a price reduction, it is very likely that you are overpriced.  Why?  Let’s examine this just a bit.

First a disclaimer of sorts.  This may piss you off.  I know.  This conversation generally pisses people off.  Most people are polite with me but I know they aren’t loving these tough conversations.  My dad doesn’t have the need to keep it polite, and he clearly didn’t like the frank nature of our conversation as we discussed his overpriced home.   But, if you hire a good Realtor, you’ll have someone that’s willing to have the Tough Talks.  It’s not a service otherwise.

The reality is that these words are nothing more than a way to justify pricing on an overpriced listing.  The truth (especially in today’s climate): no one writes offers on overpriced listings. They just don’t.

But why?  Several reasons, but for the purposes of this conversation, I want to ask you to be the buyer.  As a seller this is tough but really try.  Be the buyer for the following scenarios and don’t sneak in the way your situation is the exception to the rules.  Trust me, it’s not:

• I’ve seen 10 homes today.  Some are in rough shape.  Bank owned.  Short sales.  There were a couple of traditional sales I liked but they seemed high.  If they were realistic, maybe.  But, I’m not in a hurry.  I’ll just watch them to see what happens.  In the meantime, something else may come up that’s more in line with where the market should be.
• I’m torn between a couple of homes I looked at today.  There was one that priced a bit higher than the others.  It definitely was the nicest but I’d rather buy one that is cheaper and put in the finishes that I want.
• My agent told me that there is a house that meets my criteria perfectly but it’s priced just over my budget.  She thinks we should take a look - maybe they’ll come down in price.  I just don’t want to stretch.  There’s plenty to see and I don’t want to stretch my budget, especially in this market.
• I love this house but it seems priced too high.  They must not be that motivated to sell.
• I love this house but there are others in this area that are less money.  Let’s go look at those.
• This home has something that is tough to find (big yard, view) so I would prefer this one.  I just don’t want to pay (x) more for it.  I think that if I can wait, there may be a bank owned home that will come on the market that might have a (big yard, view).  Like I said, I’m not in a hurry.

I have heard some version of every single one of these remarks from recent buyers.  Think about the nature of today’s buyers.  They aren’t in a hurry.  Many of them have been  waiting on the sidelines for months, even years, for the market to come down.  There is no hurry.

Relocation buyers are often opting to rent for a while.  Years ago they needed to hurry and buy before they were priced out.  Today, that sense of urgency does not exist.  First time buyers are as careful and as selective as they come, getting advice from every source you can imagine - parents, friends, coworkers, media sources, all telling them to search for a ‘good deal’.  Buyers that have been on the fence renting, watch for the ‘deal’.  That opportunity is what gets them off the fence; otherwise they will continue to rent.

If you take that buyer perspective back to your own home, you will realize that, “they can always make an offer” will not bring you an offer. Be clear about why you are selling.  If you don’t have to sell and you have a long term plan to own this property - great.  If you do need to sell - create a winning strategy that is in-line with today’s buyer.  Price it to be the best home at the best price. Good Luck.

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Occasionally I see various types of incentives being offered in the MLS that are meant to increase showings and subsequently get a home sold.  So let’s talk about incentives.  What kinds of incentives can you offer - and do they work?  What are the pros and cons?

Agent Incentives - This is an incentive offered to the agent that is bringing a buyer to your home.   Here are some of the examples I have seen:

1. Bring a buyer and open escrow by ‘x’ and we’ll give you a bonus of $x. There are two things wrong with this type of offer.  One, offering a stipulated commission or bonus is usually against most MLS guidelines and two, I often see these bonuses being paid to an already discounted commission so that it merely serves to bring up the commission to a full rate.  Not that compelling.
2. Every time you show one of our listings (those of your listing agent) we’ll enter you in our drawing for ‘x’. Again, I’ve never found this compelling.  I’m trying to earn a living (not win prizes) by showing my clients homes that meet their needs.
3. Bring us a full price offer and we’ll give you a bonus of ‘x’. Not only do I not find this compelling, I find it offensive and a breach of my fiduciary duty to my client.  Incentives designed to make sure an a buyers agent is achieving a certain price for a seller, does not serve the buyer that is being represented.  Definitely an ethical and legal nightmare, but believe it or not, I see it fairly regularly in the MLS.

Clearly, I’m not a fan of agent incentives of any kind.  If the commission being offered is in line with the market, that’s incentive enough.  Remember, at the end of the day, the buyer is making the purchasing decision.  No agent incentive will impact a buyer’s decision in one of the largest purchases they will make.   The one exception may be when inventory is high and you discount a buyer’s brokerage fee so that the competition is more appealing.  If the choice to show your home or another lies in the hands of the agent, they may show the competition.   But again, that isn’t about incentive, that reflects the need to offer a competitive compensation rate and nothing more.

Buyer Incentives - This is an incentive offered to the buyer that is considering buying or viewing your home.  Sometimes offering these incentives are less expensive than a price reduction.  Here are some examples:

1. Seller will pay one year of the buyer’s Homeowner Association Dues. Depending on the cost of the dues, this can be meaningful to the buyer and a relatively small compromise to the seller.
2. Seller will pay for rate buy down of ‘x”. I like this offer a lot, but the downside is that many buyers don’t understand it, and unfortunately either do their agents in many cases.
3. Seller to pay for ‘$x’ towards buyer’s closing costs.
   

There are some things to remember when offering an incentive.  Ask yourself the following questions before offering an incentive to a buyer:

1. Am I certain that I’m am already priced right?  No incentive will sell an overpriced home.
2. Has there been any feedback about the home that I could address (paint colors, carpet condition, yard work)?  In some cases, you are better served addressing those matters first.

In a Nutshell

• Offer an incentive to the person that makes the buying decision - not the agent.
• Don’t attempt to offer an incentive if you are overpriced or have cosmetic issues you could address.  Offering an incentive only has the potential to help if everything else has been address first.

As always, if you are toying with an idea, feel free to bounce it off me without obligation.  I’m happy to help any time.

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I came across this video today and knew it would have a home here. These are wonderful tips for sellers in preparing your home for sale, pricing, showings, and negotiations.

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Today I came across an excellent article via Twitter; Missy Caulk directed me to it and I’m glad she did because it is another wonderful piece on Selling Your Home in a Buyer’s Market by Bill Gassett of Massachusetts.

One thing I particularly find interesting is his advice on selecting an agent.  Remember, one of the critical goals is find an effective marketing person for your property.  Bill suggests taking a moment to Google the agent you are considering hiring and he asks the important question, “If an agent does not know how to market themselves how could you possibly expect them to do a good job marketing your home?”

I’d like to take this wonderful advice a step further.  Look at what comes up when you Google them.  Do you find purely self promotion?  Or do you find an agent that is really speaking to consumers as well?  This is an important distinction.  If it’s constant self promotion, they are effectively marketing themselves, but are the focusing on the needs of consumers?  The type of agent providing listings, market information, and quality content throughout the web, is more likely to attract a prospective buyer for your home through those efforts.

Don’t forget, in today’s world - buyers are online - not in magazines.

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