Market Conditions in Bayside>Question Details

Vartan Mensu…, Real Estate Pro in ELMONT, NY

i need to know why sellers dont want to understand todays market value

Asked by Vartan Mensu Call ME, ELMONT, NY Mon Jun 9, 2008

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Coach Bob Fitzgerald’s answer
Here is an idea that has been working real well for some of my Realtor clients...

Take a motivated seller to preview homes in their price range with you as if they were the "buyers." If the home is over priced based on today's market then their will be many homes for sale at their asking price that are bigger, newer, have better locations or are better than the seller's home. The seller will see for themselves that if they were a buyer in the price range of their listing they would not buy their home... that is when they get realistic and lower their price.

Too many agents only discuss comps. Comps are the what the market paid for a similar home not WHY the market paid that price. For example, if you have a listing at $225,000 but the comps show $199,900... there are bigger better homes for sale at $225,000, similar homes that will sell at $199,900 and smaller, older homes at $175,000. Show the seller the bigger, newer homes at $225,000 and then the similar homes at $199,900 and then ask for a price adjustment. E-mail me for price adjustment scripts.

Just a thought.
Bob
1 vote Thank Flag Link Mon Jun 9, 2008
Rising markets are easy for them to accept. Declining markets are always hard because of regrets and I should have.
Web Reference: http://PaulmvpTeam.com
0 votes Thank Flag Link Tue Jun 10, 2008
In life fantasy and reality often don't meet until it's too late.
Web Reference: http://GetPrequalified.com
0 votes Thank Flag Link Tue Jun 10, 2008
I certainly understand a disconnect between the rational and the emotional ...


But you're forgetting one thing ... (not personally) but you're the realtor that stood at that same kitchen table with your hands on your hips and told him that $350,000 house was a great purchase 6 years ago and he could depend on that (true story) ...

Now, 6 years later .. he's added closet space, upgraded all the bathrooms and added a room addition, but your telling it's worth $30,000 less (true story)..

So .. what story does the consumer believe..?

The story that was told to them by their bestest realtor friend 6 years ago ..?

Or do they believe the story that is being told to them now..?

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0 votes Thank Flag Link Tue Jun 10, 2008
Bob's suggestion is excellent. It's a good way to break the seller out from the self-denial shell.

Addressing your specific question, though, as to why they don't want to understand today's market value: There's often a disconnect between the rational and the emotional. Ask those sellers, rationally, what's happened to housing prices over the past couple of years and many will acknowledge that prices have dropped. They'll admit that the house down the block (identical to theirs) sold for $30,000 less than they're asking. But, they'll explain, their house is different. (And here comes the emotional.) The owner spent two months perfectly painting one of the bedrooms, and is now working on the second bedroom; you'll never see a better paint job anywhere, he explains proudly. (That's a true story!) Or it's worth it because the owner just fixed up his garage. (Another true story.) Or because the owner has some grape vines on the side of the house; you won't find that in any of the other properties on the block. (Another true story.)

They'll take examples they're emotionally (and sometimes financially) invested in, and then inflate it all out of proportion to justify the price. Years ago, I thought they were just trying to "blow smoke" at me. But I've come to realize that, at least in many cases, the owners have persuaded themselves that these small improvements, if they actually are improvements at all, have radically elevated the value of their property.

Just an observation.
0 votes Thank Flag Link Tue Jun 10, 2008
Don Tepper, Real Estate Pro in Burke, VA
MVP'08
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I think Bob hit the nail on the head. Great post!

Rather than ask "why they don't get it" - we've been looking for ways to creatively demonstrate to them market information from national and local sources that indicate the current trends. We also have been using A LOT of local information.
What I've been finding is that it doesn't really make a dent too often. They feel beaten up.

I really like Bob's idea (if they'll go out with you). And really, you only have to show them maybe 3 houses to make your point. I'm definitely going to bring up this idea at our next team meeting!
Web Reference: http://www.tommcgiveron.com
0 votes Thank Flag Link Tue Jun 10, 2008
Good post Jodi & Bob ...

Most comps are nothing more than printed sheets of paper that conveniently match what the buyer or the seller might be thinking ... but unless you've actually felt, touched and walked through the comps, then they are just that - printed sheets of paper.

->>>>>"Take a motivated seller to preview homes in their price range with you as if they were the "buyers."

->>>>>"Too many agents only discuss comps. Comps are the what the market paid for a similar home not WHY the market paid that price.



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0 votes Thank Flag Link Tue Jun 10, 2008
I feel that the media cryng "the sky is falling" hurts the overall real estate market. It's hard for a consumer to believe that he needs to pay a certain price when he sees on the local television news that property is selling for 10-15% less....based on national stats that may mean nothing to that particular area!
Web Reference: http://www.cindihagley.com
0 votes Thank Flag Link Tue Jun 10, 2008
The Hagley G…, Real Estate Pro in Pleasanton, CA
MVP'08
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No one wants to think their home is worth less than they thought. It is up to us Realtors to educate them on the appraisal process, mortgage contingency clauses and how it is not enough for a buyer to be credit worthy to get a mortgage; the house needs to be credit worthy as well in order to appraise.

The responsibility is ours. If we are doing our jobs correctly and showing instead of telling, the process will be close to seamless. We must be accountable.
Web Reference: http://GailGladstone.com
0 votes Thank Flag Link Mon Jun 9, 2008
I think when we approach sellers from a smart, educated and humble place, sellers are open to hearing the message. We as REALTORS must be ready to take more time to invest and educate our precious commodity.
0 votes Thank Flag Link Mon Jun 9, 2008
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