We’re not in a hurry.
What do you think a home owner means when they tell a REALTOR, “We’re not in a hurry”? We hear statements like that during the early meetings with home owners. I think those are just words and they don’t mean what we think they mean. Could it be we’re not in a hurry to be disappointed? Who wouldn’t be in a hurry to be ecstatic?
Facts show you will be disappointed with the selling process once you pass day 11 on the market. Out of 742 homes sold on the West side of Madison since July 1, 2020, Five hundred and fifty four (554) sold in 11 days or less. Of the 554 sales, 87% of the homes sold for the asking price or greater. Mostly greater. How important are the first 11 days? Only 17.5% of the homes that sold after the 11th day were sold for the asking price or more. The window of opportunity to take advantage of this red-hot seller’s market is 11 days. Maybe the question isn’t, “Are you in a hurry?” but rather, “Would you prefer to be thrilled?”
There has never been a market like this. Because we’re more familiar with a balanced market, we still think that we have to negotiate as sellers. We think we need to price higher and prepare to give a little on price. Consumers still believe a low price will invite lower prices. That may be true, I don’t know. But I do know when you have multiple offers, the person who is going to give you the best price and terms has a reason to give you their best price and terms. Without competition you lose the motivation factor. Fear of loss is real. No one knows the price of any of your offer. Apply logic and tell me what you think. If you hear the seller has 3 offers, do you take a chance of offering less? If you hear the seller has no offers, do you take a chance? Three low price offers are motivating factors because only you know the price.
Results show pricing where you hope the price will rise to is the wrong approach today. People who price their homes at or near prices supported by an appraisal are getting the higher prices and the terms they need to close at those higher price. On the other hand, if you see the high prices and price at the limit, you’re pricing for that one buyer who will overpay. They may be there but they aren’t overpaying if they’re not competing. Draw a crowd.
Leverage. Whomever has leverage controls the outcome. After 11 days on the market, patience is wearing thin. Unmet expectations quickly take a toll.
Take advantage of the market with smart pricing. Prices escalate with demand. Attractive prices drive demand. When we present multiple offers to home sellers, the most likely scenario is most of the offers will be at the asking price or just a little above. If you’re going to get a ridiculously high price, you’re going to get that from ONE buyer. It’s the five offers you don’t accept that cause the one buyer to make the Offer you’re thrilled to accept.