Easy Tips to a Price Reduction
by Christy Crouch
Price reductions are a critical part of the business if you’re a listing agent. I carry anywhere from 40-60 listings on any given time in most market conditions, and in order to get them sold it’s a must to have a price reduction campaign of sorts in place.
One thing I’ve found to be super helpful when talking with my sellers is to not refer to it as a price reduction but rather a price adjustment. Whenever we as consumers think of reductions it feels like we’re losing something. When we think of the word adjust it feels as if we’re making something better, and of course we naturally want to focus on making things better and not losing something, right?
Don’t allow your mind to play games with you and have you assume your sellers don’t want to adjust the price or won’t. I can tell you from experience time and again, they’re simply waiting for you as their professional to advise them of when and what to adjust the price to.
I work with a lot of expired listings and I can’t tell you how many times the sellers are more than willing to adjust the price when we go on the listing appointment and tell us they thought they needed to adjust the price but their agent never mentioned it or what’s worse, they never heard from their agent after listing the home with them.
The key to price adjustments is educating your seller on market conditions and revealing to them when they’re priced out of the market. You do this of course by providing them with updated market research showing how they’re comparing to others that are for sale that they’re in competition with and those that have sold. Tell them what the average days on market is and what the average list to sales price ratio is then lead them to the price you feel they need to be at in order to sell.
One thing that’s really important is the price brackets that buyers tend to shop in.
For example, $249,999 and not $252,000 as significantly more buyers will be searching for under $250,00. Make sure your sellers understand that whenever they can price themselves just below those price breaking points they will keep themselves exposed to many more buyers.
Also point out that whenever they adjust the price it helps to rejuvenate things by bringing their home back to the forefront on the daily report that agents and companies pull, generally referred to as the hot sheet, that reveals new listings, those that have sold, and those that have adjusted their prices. This and getting under the next price breaking point will be big factors in ultimately getting their home sold.
I have found emailing the updated market analysis along with the above explanations to be super effective. Many times I simply get an email response from our sellers saying let’s go ahead and change the price. In fact, last Friday I did exactly this and had one seller adjust from just 189,950 to 184,950 which brought it into a buyer’s range who was looking to be under 185,000 and it sold over the weekend.
If you need help working more with price adjustments please comment below or feel free to reach out to me direct at firstname.lastname@example.org
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