When Your Seller Won’t Price Properly, Try These Figures!
Last week, we mentioned that ARMLS’s STAT report had just been released and offered some ideas about using those statistics with buyers. This week, we’ll focus on sellers. If you don’t have that report open, take a moment and get it. I started by suggesting you review the STAT report’s graphs and statistics to get a sense of what they’re saying, then check out Tom Ruff’s commentary at the end. I recommended you look at things from the viewpoints of supply, demand and prices.
As a quick review, I pointed out that monthly sales were down slightly in June and Months Supply of Inventory was very slightly higher, both in line with the seasonal nature of these statistics which trend slower in summer. We also saw that new listings have been steady since the first of the year and total inventory is about where we would expect it. Prices are flat and not moving much, so it’s unlikely we’ll see any huge surprises in this market.
As mentioned, a buyer’s or seller’s motivation pretty much drives the transaction, with unexpected changes in personal situation being big drivers for sellers. When presenting comparable prices to a seller during pricing discussions, it’s important to point out that everything is relative, depending on their personal factors. A motivated seller is more likely to take your advice when it comes to pricing. However, what do you do with sellers who have unrealistic expectations?
If your seller needs to move soon, it seems logical that they would be willing to price their property lower than recent sales of comparable homes in their area or be willing to make some concessions regarding closing costs or items to be included along with the home. You need to bring that logic to them:
- Show your seller Average Days on Market figures… over this large market area, it’s taking 17 days longer to sell a property this year and one day longer in June than in May. A higher asking price will tend to stretch out that time frame.
- Show them the Monthly Sales figures… sales are off over 20% from last year and down 3% since last month. Given the usual summer drop in demand, one way to make a property stand out is to make the deal more attractive.
- Show your seller the Total Inventory and New Inventory figures… there is plenty of competition out there for prospective buyers. Great marketing and terrific features won’t bring buyers to look at a home they see as overpriced.
Hopefully, these ideas will get you thinking about supply, demand and pricing, and how you can use STAT data to support you as a credible real estate advisor. In an upcoming article, we’ll switch gears and suggest some ways you can use STAT figures in situations where your buyer or seller is in a holding pattern.
Please share your comments about this article and email me your ideas about other topics to discuss. I’m Ron LaMee, firstname.lastname@example.org.July Edition 3, market analysis