As the seventh tactic of our “Shift” series, how can you price ahead of the market and deliver pricing strategies to your seller clients with clarity, focus, knowledge, and intent?
First, know that the only sustainable competitive advantage you have over your competition is to learn faster. There are five stages of grief a seller goes through in a buyer’s market: denial, anger, bargaining, depression, and acceptance. A seller only has one chance to make a good first impression in a buyer’s market, and the best marketing message they can send is to tell buyers that they’re priced correctly.
A great agent expertly prices through precision data, but you have to hit on emotion first. Ask your sellers to think of a reason why they’d want to sell their home and remind them of their motivation. As we know, logic makes you think, but emotions make you act.
Our job as agents it to educate our clients to make good decisions, so make sure your sellers understand the market. Your local market can change incredibly quickly, so it’s imperative that you know the local numbers. With this education in hand, you can move your clients in the right direction.
For example, we use a ton of absorption rate numbers with our clients so that they know the direction the market is moving. When you look at the number of homes that have come on the market in the last 30 days and it far outweighs the number of pending or sold homes, that’s indicative of growing inventory, declining demand, and downward pressure on prices. Don’t let your sellers be victims of chasing the market down.
Next, practice and deliver the scripts. Scripts are important because they give you confidence in navigating the pricing conversation with ease. At 2:50 in the video above, we roleplay an example of how effective a practiced script is.
Your sellers also need to understand an important concept: Don’t chase the market—let the market chase you. Statistically speaking, sellers will find themselves facing either a buyer’s market, a seller’s market, or a balanced market. With that in mind, there are seven maxims for pricing in a shifting market:
1. Be a student of your market and know your numbers
2. Focus your comps on active homes
3. Preview properties where you understand what’s behind the numbers
4. Keep your presentations as current as possible and let your ongoing research speak for you
5. Pre-qualify for motivation—sellers who need to sell succeed most often
6. Secure price adjustments in advance to help sellers avoid falling behind
7. Always price ahead of the market
If you’ve ever watched the show “The Price Is Right,” there’s something you can learn from it that applies to our topic: Everyone loves to be a pricing expert, but very few are, and only the ones who get the price right are the ones who win.
If you have any questions for us about your continued success in a shifting market or about today’s topic, please let us know. You can also visit our website to sign up for our agent newsletter, our business planning clinic, or to book a one-on-one appointment with our team. We’d love to have a conversation with you!