I spent the day yesterday at our annual Keller Williams Advantage golf tournament.
I typically don’t play in tournaments because I don’t feel its fair to the other players. Most tournaments attract a mix of golfers and quite a few of the attendees don’t often play golf. Such occasional golfers are easily intimidated when a great golfer is playing with them. In fact, when the game is so challenging to many people, it can be pretty irritating when someone comes along and just excels at the sport.
In recognition of this fact, I deliberately played poorly yesterday. If you saw me golf, you would have absolutely said to yourself “Self, this guy is a horrible golfer.” I missed putts that a 2 year old could have sunk, I hit many, many balls into many, many wooded areas and I threw temper tantrums whenever anyone said I should stop picking up golf balls I found.
It was refreshing to golf so poorly and I think I will continue to do so for the rest of the season. If we happen to golf together, please don’t let on that you know I’m deliberately playing poorly and that I am in fact an excellent golfer.
On a more serious note, changing how you do things is important when circumstances change.
The real estate market is most certainly changing these days. After a number of years as a seller’s market, it is shifting towards a more balanced market. Let’s look at three ways in which this changing market means Realtors have to change their approach.
- Pricing Strategy
With more inventory on the market we are seeing more and more listings come up that are following the older approach to pricing, namely asking for the price you want. The strategy of pricing below market value to attract lots of buyers and holding back on receiving offers to a specific date is going by the wayside.
A few months ago, about 90% of listings were doing this price low and wait approach to try to get a frenzy of buyers on the offer date, with multiple, clean (no conditions) offers.
We are now seeing about half of listings doing this and many of those listings fail to sell on their offer date and are subsequently relisted the next day at the price they want.
I believe within a month or two, about 90% of listings will be priced at what the sellers hope to receive. When a market is changing and buyers are uncertain about what will happen next, asking them to submit at a price they have to choose (effectively bidding against themselves) is an additional stress that isn’t helpful in getting the property sold.
- Marketing Approach
While effective marketing is always necessary to get the most potential buyers through a home, in a seller’s market many agents got pretty lazy. I saw homes with bad pictures, no measurements and limited detail sell quickly. I believe with effective marketing they would have sold for more money, but they did sell.
Most Realtors follow the three Ps of selling, which are:
Put it on MLS
Place a sign on the front yard
Pray someone buys it
Regardless of the type of market we’re in, a good Realtor needs to always add a 4th P, namely prospecting for buyers. This means actively marketing the property, door knocking the neighbourhood or calling the building and reaching out to agents who do business where the property is located.
By showcasing the property at its best and getting it in front of more buyers, good Realtors get homes sold for good money, regardless of the market.
- Negotiate with Knowledge
In a hot seller’s market, lots of agents forgot how to negotiate. On the sale side, many agents switched to demanding a price rather than negotiating a price. With multiple offers on the table, buyers often felt they had little power and had to give in to the price demands or lose out. Good Realtors made sure their buyers didn’t pay a price that didn’t make sense and that their sellers didn’t forget that price was only was aspect of a successful sale.
In a more balanced market, negotiating is once again a crucial skill for Realtors.
This means that we need to come to the negotiation with the knowledge and information that supports the price we’re asking for the home. In every sale of a home, a good Realtor needs to sell it twice. The first time is to the buyer’s agent, where I provide the comparable properties that are for sale and those that recently sold, talk about the features and attributes of the home and show how the value in our property supports the price we’re asking.
The second time is to the buyer themselves, where I showcase the home at its best, make sure to highlight the desirable aspects of the home or area and reassure them that this is not only a great home but a great investment.
By having the knowledge that supports our price, we can craft a compelling argument for the buyer and their agent that helps them realize this is the home for them and the price is fair. Understanding what is going on in the market also means that we can defend against aggressive agents or buyers who want to buy the home at a bargain. When we delve into the specifics for the area, the story is often quite different than what is going on in the market as a whole.
If you or someone you like is considering a change in your living situation, please get in touch. I’d love to be responsible for what comes next.
A vast part of the earth’s surface, in a town, consists of roofs. Couple this with the fact that the total area of a town which can be exposed to the sun is finite, and you will realize that it is natural, and indeed essential, to make roofs which take advantage of the sun and air.
If you have ever lived in or visited a home with a roof garden off of a lived-in part of the home, you know the tremendous appeal of having a green space on the roof. Such spaces can transform the rooms they adjoin, with pleasant views and nature where otherwise only urban density is seen.
These roof gardens quickly become some of the favourite places in the home to gather and spend time.