Bitter Pill to Swallow 4 October 2022
One of the things I have wanted to get off my chest for a while is discussing pricing with Sellers.
You would note that in my previous blog I am well aware of what a prickly issue the price can be for a Seller. So naturally this is a thorny issue, when you need to tell the Seller that their expectation and therefore asking price are too high.
But today we are looking at things from the Agent’s perspective.
Imagine for a moment being a doctor. (Nice title, fancy rooms, plush reception)
Sounds great, right?
But Mr. P is sitting in front of you and you have his test results. He is waiting for you, the expert, to tell him what’s wrong ,and how to fix it.
He has a potentially terminal condition.
He probably is going to be unhappy about this. He in fact does not want to hear this at all.
Telling him is going to upset him and he is probably going to respond badly.
What kind of doctor would you be if you told him there was nothing wrong? “Carry on as usual and it will clear up shortly.”
Do you think he would be happy with this advice?
Especially when a few months later he gets a second opinion and discovers what’s really wrong. Undoubtedly it would be extremely irresponsible to conceal the truth, to not tell Mr. P everything. The good, the bad and the ugly.
Luckily for Mr.P, if he can swallow the truth there is a potential cure. Hooray!
Do you think Mr. P is likely to turn to the Doctor and say; “Nonsense! There is nothing wrong with me. I don’t need help or treatment.”?
It would seem unlikely. After all he engaged the services ofa qualified and educated professional. Hand picked the Doctor from a host of others.
The difference is, that Mr.P, although he will be distraught, will want to hear the doctors news, will want his reassurance and will want his advice. Even if he decides to get a second opinion, the diagnosis will be the same.
Mr.P. however does not want his agents advice. He does not want to adjust his price. He is not convinced that after all these months, sole mandate, open mandate, viewing after viewing, show day after showday, that there is not, somewhere out there that one buyer, who will pay his price.
He will ask the agent: “But why hasn’t my house sold? It’s beautiful and lovely and worth every cent!”.
I have recently had a client tell me: “I paid X and then spent Y, our asking price is determined by what we paid, what we have spent, the finishes, the size and the position.”.
It is hard not to retort “Exactly!”, but this would no doubt simply anger the client and alienate them. But its true. How so?
Because the buyers, collectively, form the market. The buyers are able to compare the property with everything else on the market, at that price, in that area and all the areas surrounding. Without the buyers, no one would sell anything.
With easy access to property portals and wealth of online information the buyers are quickly able to decide which properties they would like to see, what they feel a property is worth and at what price they would like to make an offer, based on the value THEY see.
Granted from time to time there is a chancer, or a buyer who simply can’t see that they are making consistently low offers, but this Is where the agent protects the Seller from misinformation and manages a low offer.
So when a client declines the Doctors advice, and doesn’t take the treatment, what happens?
The property sits on the market. It stagnates. It slips further and further back on the portals, until it is gathering dust on the last pages, and the buyers now assume, there is something wrong with it.
They are convinced its not worth the asking price, and even when the price is adjusted they are likely to feel that this is a bargain basement sale and they should offer less.
Listen to the market, listen carefully, listen with an open mind and take your agents advice.
You wouldn’t ignore your Doctor or your Lawyer, why ignore your Agent?