Seller Pricing Strategies Instructor Powerpoint

REVISED EDITION

An Agent’s Guide toSeller Pricing Strategies

Pricing Your Listings to Sell

Breakthrough to Mastery

2An Agent’s Guide to Seller Pricing Strategies

Main Ideas1. Perspective on Pricing Strategies2. Study Your Market3. Approach Sellers4. Get the Right Price!5. Manage Your Listings in a Buyers’ Market


Perspective on Pricing StrategiesWhen the market shifts toward a buyers’ market, the listings sit! Don’t let that happen to your sellers.

1. In a buyers’ market, real estate becomes a commodity.

2. Only properties in good condition and priced right will sell in a buyers’ market.

3. Price can correct bad condition—but condition won’t correct bad price.

4. Correct pricing represents 80% of your marketing effort.

Page 7


Perspective on Pricing Strategies (continued)

Your Role in a Buyers’ MarketWhen houses sold in a matter of days, agents were undervalued, but now customers need you for your

» Pricing strategies» Market knowledge» Buyers» Fiduciary commitment» Knowledge of financing options» Negotiation skills

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Perspective on Pricing Strategies (continued)

What Are the Opportunities?» Opportunities for Agents» Opportunities for Sellers

Page 9


Get Ready, Get Set, Go!SHIFT happens!Maximize your effectiveness as a consultant to your sellers.

» Get Ready! – Study your market» Get Set! – Prequalify your sellers, update your

listing presentation» Go! – Get the right price

Page 10


Study Your MarketBe the Local Market Economist

» Be more knowledgeable than the headlines—research the local conditions and trends that will affect them.

» Preview more properties to get a better understanding of what is on the market.

Page 11-12


Study Your Market (continued)

Analyze the MLS» Use your local MLS to track market numbers in

their price range.» Take the shifting market into consideration

when evaluating the comparables.» Get the big picture. Buyers will prioritize the

deal, rather than the area. Your sellers are competing with homes in their price range all over town.

Page 13 - 15



Analyze the MLS» Take time to study and internalize the statistics

that are reflective of your market and which matter to your sellers.

» Choose numbers and statistics from the MLS and use the data in a sentence later that same day.

» Choose a partner from your team or Market Center with whom you can practice the numbers. Meet weekly.

Page 16



Use Formulas and GraphsEnhance the raw data from your MLS by using formulas and graphs to illustrate the market to your sellers.

Page 17

Tip!

Practice the math before your listing presentation until you are confident with the numbers, but for a powerful presentation, take copies of the MLS data and work out the figures together with your sellers.



Use Formulas and GraphsThe Activity Index

The number of properties going under contract compared to the number of active properties on the market.

Page 18

Actives + Pendings

Pendings= Activity Index



Use Formulas and GraphsThe Absorption Rate

The absorption rate will tell you how many months of inventory you have on the market. It demonstrates how long it would take to sell all the homes on the market if no other homes were to come on the market.

Page 19

Number of active homes on the market

Number of homes sold in the last 30 days= The Absorption Rate



Use Formulas and GraphsGraphs

Many people respond well to visual information. Show your sellers the MLS statistics by using vivid, clear, and colorful graphs.

Page 20

Tip!

Use Microsoft Excel when plotting your graphs, or get help from your Market Center. There are also online services and software programs you can use to create graphs



Use Formulas and Graphs

Page 21

New Listings vs. Sales in Area 62

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New ListingsSales

Information is deemed accurate, but is not warranted. Data obtained from the First Multiple Listing Service. Based on a rolling six month average.


Approach SellersFind the Motivated

» You can only afford to work with the very motivated.

» Prequalify your sellers before you make the listing appointment.

Page 22


Approach Sellers (continued)

Update Your Listing PresentationTell the Truth

» You are not doing your sellers any favors if you are tempted to soften the blow in order to get the listing.

» Care enough about them to be strong up front and get the right price.

Page 23



Update Your Listing PresentationLeverage the Media

» Clip out articles from the newspaper that support your position and send them to your sellers.

» Back up the news stories with your own hard data.

Page 24



Update Your Listing PresentationListen for Responsiveness

» Return to their motivation if you sense they are not receptive, and determine whether or not you want the listing.

» Some sellers may not be able to face reality and won’t be able to list their home at the price needed to sell it.

Page 25



Update Your Listing PresentationLearn New Scripts and Dialogues

» To present MLS data effectively, you will need to speak with confidence to educate your sellers and vividly illustrate the new reality of their market.

» Take the time to learn new scripts so you are confident and polished during your presentation.

» Choose a partner from your team with whom you can practice.

Pages 25-27



Update Your Listing PresentationCommunicate Effectively

» Practice scripts and dialogues.» Focus more on your sellers’ need to express

themselves.» Keep them talking and LISTEN to what they tell

you.

Pages 28



Update Your Listing PresentationBe Prepared to Answer Objections

» Address objections before they come up. Send out a thorough CMA in your prelisting package.

» During the listing presentation, bring up objections yourself and then sweep them away.

Pages 29-31


Get the Right Price!Don’t Miss the Window of Opportunity

Original Price is Critical» If a buyer believes a house is poorly priced, they will

write it off from the start.» Even if the price is subsequently reduced several times

or home improvements are made, the best chance for selling is lost forever.

» For homes that have a price reduction, the time to sell increases by two to three times.

Pages 32-33


Get the Right Price!Allow Your Sellers to Self-Discover

Ask simple questions:» “Looking at all the comparables here in the MLS for

your neighborhood, how much would you be willing to pay for your house if you were a buyer today?”

» “Given what I’ve shown you about the market, what do you think your house will sell for?”

» “Look, what do you think we need to do? Here are the numbers.”

Page 33


Get the Right Price! (continued)

Tell the Tale of Two Markets: Sellers’ Market

Page 34-35

Great PoorCondition vs.

Comps

Above

Below

Pric

e vs

. Co

mps

In the Market

Out of theMarket



Tell the Tale of Two Markets: Buyers’ Market

Page 36

Great PoorCondition vs.

Comps

Above

Below

Pric

e vs

. Co

mps

In the Market

Out of theMarket



Tell the Tale of Two Markets: No-Man’s Land

Page 37



Tell the Tale of Two Markets

Page 38

Fill in the chart on pg. 38 of your guide

1. Think of current listings in your market that you consider “IN the Market,” “OUT of the Market,” and in “NO-MAN’S-LAND.”

2. Now think of what price adjustments would have to be made to the listings that are in “NO-MAN’S-LAND,” and “ON the Market” in order to get them “IN the Market.”



The Law of Supply and DemandWhen pricing their home, sellers need to obey the law!

Sellers’ MarketA market which has more buyers than sellers.

High prices result from this excess of demand over supply.

Page 39

Buyers’ MarketA market which has more sellers than buyers.

High prices result from this excess of supply over demand.



The Law of Supply and Demand

Page 39

How can you use MLS Statistics to explain the effects of supply and demand in your market?



Don’t Chase the MarketWhether the market is going up or down, you want to price your listings ahead of the market—ahead of it on the way up and ahead of it on the way down.

“You’re in a race against time. The best price you’ll get is the one you get now. If you wait, it will be lower.”

Jackie EllisBoynton Beach, Florida

Page 40-41


Manage Your Listings in a Buyers’ MarketOffer Phenomenal Customer Service

» Increase frequency of communication.» Increase frequency and unique timing of open

houses.» Send your sellers regular market information

updates.

Pages 42-43


Manage Your Listings in a Buyers’ Market (continued)

Get Price ReductionsOverpriced Listings

There are very few overpriced listings that are too overpriced to take. If you take overpriced listings, three elements will help you get the right price.

» Time» Your strengthening relationship» Market statistics

Pages 44-45



Get Price Reductions

» Schedule your reductions» Get into the next bracket» Keep carrying costs low» Mind your language» Know when to call it quits

Pages 46-47



Auction Your ListingsCreate desire for your listings by marketing well-priced and staged properties as “Coming Soon.”

» Establish correct market price» Have property inspected and staged» Put up “Coming Soon” yard signs with the date of the

MLS opening» Wait a week to ten days without showing the house» Announce the opening» Sell the house!

Page 48



Offer Seller Concessions» Learn about the seller concessions and real estate

financing concepts that create a competitive edge.» Work closely with a trusted loan officer who is

knowledgeable about the details.

Page 49

For more details about seller concessions, see An Agent’s Guide to Financing Solutions, from Keller Williams University.


The Bottom LineThere may be no single factor more important to getting a home sold than its price.

» Your local expertise and market knowledge are the key to getting your sellers to price their homes to sell.

» Let the numbers do the heavy lifting. Arm yourself with the facts and figures and use formulas and graphs to explain the current market to your sellers.

Page 50


Productivity Boosters Analyze the MLS Update Your Listing Presentation Keep Your Sellers Informed Buyer Seller Matching

Page 51


My Action Plan

Pages 57 - 58

Don’t put away this guide without developing a plan to put what you have learned into action!

Refer to the Action Plan on pages 57-58 of the guide to assess your strengths and areas for improvement.

Write down steps you will take to improve your skills—complete it, share it, and commit to it!


Take the other courses in the Breakthrough to Mastery Guide series! Gaining Mind over Market Upshifting Your Lead Generation Seller Staging Strategies Lead Capture and Conversion Internet Lead Capture and Conversion Creating Urgency to Buy Bulletproofing Transactions Expense Management Effective People Leverage Short Sales, Foreclosures, and REOs Financing Solutions


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Seller Pricing Strategies Instructor Powerpoint