Listing Homes for Sale - Part 4 of a 5 Part series

Link to Listing Homes for Sale - Part 1 of a series

Link to Listing Homes for Sale - Part 2 of a series

Link to Listing Homes for Sale - Part 3 of a series

This series focuses on effective and efficient methods of meeting with Sellers who want to sell Phoenix area Homes and Real Estate, determining whether there is a good fit between the Seller and the prospective Listing Broker, and the technology that is available to streamline the process.

List Price Discussion

So now it's decision time:

1. Does the Seller believe that the marketing plan offered by the Listing Broker meets their needs?
2. Is the Seller willing to list the home for sale at a price that is supported by the current market?
3. Is the Seller agreeable to the professional services fee?

If those three stars are in alignment, you have a great new listing!

So - how does the discussion go?

Mr & Mrs Seller - As I mentioned at the beginning of our discussion, we need to cover three key areas:

1. First - my marketing plan. We've just reviewed that and you tell me you believe I can effectively market and sell your home.
2. Next - We need to discuss List Price. Once we've agreed on that then we can move to the next step, which is:
3. Professional service fees, activation date of the listing in the MLS, and what needs to take place between now and when the doors open to the public.

Based on the information I provided to you in advance regarding Active, Pending, Sold and Expired comparable properties in the neighborhood, have you a number in mind for the initial List Price?

"Tony - we know that the information you provided shows what appear to be comparable properties have sold for an average of $390,000 - however - there are a couple of pieces of information about our property which make us think the List Price should be at $460,000. We invested almost $50,000 in backyard hard-scape and landscape, pool and spa. We know some of the comparable properties had pools and hard-scape, but we believe ours is much nicer. Also, we need to get $450,000 for the property in order to get what we want out of it when we sell."

So to confirm what you're telling me, you want to List at $460,000 and sell at $450,000 - correct?

"Yes - that's what we need to do."

Remind me - is it "optional" for you to sell the home - or do you have to sell due to the job relocation you mentioned during our initial discussion?

"We need to sell - but we also need to get $450,000"

Mr & Mrs Seller - you know from our discussion on marketing that our efforts will get you the best possible offer for your home - correct?

"Yes"

If the best possible offer turns out to be $400,000 - are you going to decide not to sell?

"Well...we have to sell...so if that's the best offer we wouldn't like it....but we would take it."

Here are my concerns about a list price of $460,000:

1. That number is $60,000 higher than any home has sold for in the last year in this area
2. From a technical perspective - pricing it at $460,000 puts it out of the price range the $450,000 buyers are looking at - if you recall we discussed REALTOR.com and other websites where searches are done in price ranges. $450,000 is one of the cut-off points
3. By pricing it at that price point you will be helping your competition sell - while your home languishes on the market
4. It's not just a Buyer and Seller that need to agree on the final price. Unless it's a cash Buyer who waives the appraisal - and in this market that's extremely unlikely - the Buyer has to "sell" the purchase price to their Lender, who will rely on their Appraiser - and I don't see anything here that would support an appraisal of $450,000 - do you?

"Well...no..."

I understand the time, effort and money you have invested in this house, and I'm sure you've enjoyed living in the property, however - as a real estate professional I have to advise you that the likely sale price for the home will be anywhere from $385,000 to $400,000 - based on the market data available. You have Active competition priced at $410,000 - and that's been out there 4 months! How soon do you need the house sold?

"We need it Sold within 90 days"

If there is a comparable property on the market for 120 days at $410,00 - please help me understand why pricing your home higher than that will get your home sold in your time frame.

"Well...it probably wouldn't"

In fact - when we review the Days on Market for the Sold comps, we see a property that was on the market for 36 days before going under contract - and that was priced at $399,000. I don't see how pricing your property at anything higher than $400,000 will result in a sale in the time frame you want - do you?

"Well....no......"

Based on our discussion - what do you believe from an objective point of view is a List Price that will result in a sale in the time frame you want, at a price that will be supported during the appraisal process?

"Well....$400,000.....but we really want to get more than that"

So - if you price it at $400,000 and the Buyers in the market believe it's worth more, you may get multiple offers.

To meet your goal I agree with you that $400,000 is the appropriate initial List Price - and bear in mind that if we haven't had an acceptable offer within 45 days or 20 showings - whichever is first - I'll be asking you for a Price Adjustment. Does that sound like a reasonable plan to you?

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The end result of this discussion MUST be full agreement between Seller and Listing Broker regarding what the initial List Price and pricing strategy will be. If the Seller refuses to list at a price that is reasonable - there is still one more card to play during the next part of the discussion.

The pricing discussion can end one of two ways:

1. Mr and Mrs Seller - I agree with your pricing strategy and now we'll move on to the next part of our discussion.
2. Mr and Mrs Seller - I still have concerns with your pricing strategy - however - let's move on to the next part of our discussion and revisit the pricing strategy after that.

The next part in this series will cover the Professional service fees, activation date of the listing in the MLS, and what needs to take place between now and when the doors open to the public, including sample scripts for different scenarios. Stay tuned!

*** Updated Listing Homes for Sale - Part 5 of a 5 Part series

If you are considering selling a home or real estate in the Phoenix area you owe it to yourself to talk with The Marriott Group at Keller Williams Realty Professional Partners to determine whether Tony Marriott is the best real estate Broker in Phoenix area to help you with the sale of your home.

http://www.phoenixarizonahomesearch.com/

http://www.marriottrealty.com/

http://www.greaterphoenix-scottsdale-homesearch.com/