Friday, November 9, 2018 / by Robert Woessner
The Price Myth Debunked – Why Price Isn’t the Only Reason Homes Don’t Sell
Are you sick of being told the reason your home didn’t sell was because it was "overpriced?"
Most people think a home that didn’t sell was probably "overpriced." Nothing could be further from the truth.
The reason homes don’t sell is not always because of the price. It is usually because the home wasn't marketed properly.
It’s not easy to sell something for full market value.
You may need to negotiate price with a buyer, but good marketing helps bring in a full price offer!
Here is a perfect example. John was trying to sell his house. He put it on the market for $499,900.
He hired an agent to help him sell it. The agent worked at a reputable firm and made a good effort to sell John’s house.
? The pictures of the house were top notch quality.
? The marketing of the house was first class. The home was advertised extensively online, in the newspaper, and other marketing avenues.
? The agent did an open house.
The agent’s efforts failed to attract a buyer.
John’s agent recommended that he adjust the price. After all, most of the similar homes were priced around $400,000 to $450,000. He recommended dropping the price to $450,000.
But, John owned one of the nicest homes in the area. And his home had many features the other homes did not have. John knew this.
John was reluctant to reduce the price.
So, he hired a new agent. This agent worked at the top real estate company in the area. Had a bunch of accolades. He took a closer look at the home, and launched his own specialized marketing plan.
? New pictures were better than the first agent’s pictures.
? The marketing was better. There was even more advertising than before.
? The agent didn’t just do a regular open house. He also did a Broker’s Open House and invited other agents to view the home.
Even with additional marketing,
the second agent couldn’t sell the home either.
John was frustrated. What could he do to sell his house? Both of his previous agents had told him it was because the home was “overpriced.”
At this point, John had two options:
Option #1: Drop the price. Most of the agents he talked to told him his home was not worth what he wanted. They told him he should just "be reasonable" and drop the price to $450,000.
Option #2: Hire an agent who could sell the home for what it was actually worth. This agent’s marketing would need to get a buyer so excited about the home they would be willing to pay full price.
Here's what happened.
Fortunately, for John, he picked Option #2. He contacted an agent who specialized in selling homes other agents could not sell.
The agent looked at his house and could clearly see it was worth the price. The agent put the home on the market for the same price as the previous agents. Only this time something different happened.
63 days later, the home sold for $480,000.
The other agents were shocked. After all, they had told John his home was worth no more than $450,000.
And since most homes sell for slightly less than their asking price, an asking price of $450,000 would have resulted in a final sales price of $430,000 to $440,000.
Yet the new agent had sold the home for more. And it had taken him only two months to capture a buyer’s attention. They were shocked and maybe even a little bit embarrassed! What had they missed?
Why did the first two agents fail to sell the home,
while the other agent sold it with ease?
It’s because the new agent used a marketing strategy that most agents weren’t familiar with. The details on this secret marketing strategy are explained in the next chapter.
But first, a refresher.
If you’ve been following along from the beginning, you already know this. If you haven’t, take time later to jump back to the start. This next point is the single most important idea and concept you can grasp when selling your home.
Most people think a home will usually sell for exactly what it is “worth.” I’m here to tell you that isn’t true. I’ve said it before, and now I’ll say it again:
Homes do NOT always sell for
what they are “worth.”
? Sometimes they sell for more.
? Sometimes they sell for less.
Wait, didn’t you read those EXACT words in an early chapter? Yes! You did. And you probably laughed and said “Wow. What a no-brainer!” But you are here now, so you obviously kept reading.
I hope at this point in the book
you truly understand the impact of that statement.
We’ve been eating away at the pages, filling up on a steady diet of examples to illustrate this exact point. And that’s only the tip of the iceberg. There really are almost unlimited cases you could study.
Having a clear understanding of your home’s value is critical at almost every juncture of the process. It helps you determine what steps to take when you are preparing your home to sell. It also helps you decide how hard to negotiate and guides you toward that ideal offer.
So once more, just to drive it home, let’s look back over a few examples we’ve seen so far. In each case, the uninformed party paid a hefty price for not being fully aware of the situation and pricing they were working with:
? Cheryl and Richard – one house sold for $14,000 more than the identical house.
? The “million-dollar view” – sold the plain jane ordinary house on the spot.
? The overlooked 5-acre lot – became the deciding factor in a sale to an out of town buyer!
? Record setting condo – beat out the second highest listing by $110,000 mainly due to the staging effect.
? Piece of land worth $300, 000, snatched up for $80,000 – the seller did not realize the zoning potential.
? The stubborn bank who refused to sell pre-listing – and lost $25,000 when a bumbling agent muffed the listing.
Those are a few of many. Sadly, it happens all the time, to sellers and agents alike. That is why I keep stressing the importance of knowing what you should reasonably expect from the sale of your home!
In the following chapter, we’ll take a closer look at a strategy you can use to make sure that you start out on the right foot.