Sell House for Higher Price
When I first wrote this post years ago, prices were rising at a wicked pace. Now the home price tide has gone out and sellers are panicking.
Back then, asking price was a key issue, but today, everyone uses a low asking price, then works the prospective buyers up to a price they can live with. Prices are finally dropping in some areas, while keeping or rising in others. Due to constrained supply in new and resale listings, smart sellers can get a great price.
Realtors are using the typical negotiating game, or building blitz type campaigns to build a buying frenzy, but that’s not likley working well anymore. If you’re selling your home, you need to study market demand and how to position your property for that demand.
What Millennials want in your home versus what speculative developers, flippers, and babyboomers want are entirely different.
Anyone selling a home in Toronto, Vancouver, San Diego, San Francisco, Boston or Los Angeles, who doesn’t consider an above asking price strategy is basically giving away money. As an investment, a seller’s goal is to get the best ROI as this money could get them out of debt, be their retirement fund, kids education fund, old age health fund, or bucket list fund. That extra money could help sellers revive their lives and get their health back. No more commuting!?
Pity sellers who sell their house in 3 days when a little 2 to 3 week strategy could build interest and focus buyer intention on one special 3 day period where buyers must make their best offer. You’re a salesperson and should have extensive expertise in sales strategy.
The Changing Mores of a Business Culture
There doesn’t seem to be any ethical absolutes in pursuing the best over asking price benefit for clients. If your broker/mls/realtor association has said anything to you on the matter, I’d like to hear about it. The old paradigm that the client’s best interest is a “normal price” that’s affordable for buyers has disappeared. More investors/buyers
Almost every real estate organization stipulates acting on the client’s best best interests. I’m not sure how you can reason that one out by getting involved in a client sale and come away looking squeaky clean. And then there’s the “over asking price” value proposition. Is this the next Gambit for aggressive marketing realtors?
Given the number of rich buyers now, it’s pretty safe to offer it as a time limited selling proposition. And if you have big money yourself, it’s a limited risk that you’ll get hurt even if you lose on one or two deals.
Realtor.com on Over Asking Prices
Realtor.com‘s advice is nothing new to you:
“The most fruitful strategy.. is to aggressively price the property roughly 5% to 10% below the going market rate. This will always generate more traffic to the property and give buyers a chance to fall in love with the home, when a higher purchase price might have kept them away initially.”
Here’s a few more Over-Asking Price Tips:
- hold back and tell buyers there are other offers, even though their offers aren’t huge
- approach investors to look hard at the property
- get the seller to update the house to eliminate negatives and play up the main selling value proposition (in Vancouver it might be the views, or just the location (tear downs or flips). You may even decide to change the style of the home (brick facades, or Asian, or Arabic styling could really pay off). See what the most attractive styles in Kelowna BC are right now.
- be proactive, and like you’re in charge: do the landscaping or roof repair yourself and deduct that from your commission which preempts any attempt by the seller to cut your commission.
- do blitz real estate marketing with Google Adwords, remarketing, select outdoor ads, and play up the property to all your Linkedin, Facebook, and Twitter connections. If your site is ranking well on Google and you’re getting big traffic as well, you can actually create the bidding war climate. Timing is everything so think about how you can market strategically.