*Getting a price reduction on your listing
One of KJF Partners’ Core Values is:
“We are driven by our personal commitment to create value for our investors, tenants, teammates and brokers.”
To serve our broker partners, we send occasional emails that focus on lessons learned through my brokerage history or that I notice from my current role on the principal side of the business.
Brokerage is a challenging business and, sometimes, market shifts make reducing the offering price of your listing necessary to attract qualified buyers. As a broker, you don’t “make the market” but, you must reflect the market to get your properties sold. If you have diligently marketed your listing but, you are now competing with a downward shift in prices, it’s advisable, (although not comfortable), to have a professional conversation with your seller, and request a price reduction. The following are some suggestions, from my perspective as a client, that may help you get a needed price adjustment:
- Show me that you have aggressively marketed my property. Show me what your marketing campaign has consisted of to date.
- Give me actual feedback from your broker or buyer conversations.
- Show me the properties that my deal is competing with for today’s buyers. What deals have come on the market recently that are similar but, more attractively priced.
- Show me deals that have recently gone under contract and be specific about deal terms so I can understand why that buyer chose that property over mine.
- Remind me that although I may not achieve the price I had originally hoped for, I will definitely get a better deal on an exchange property because of the market shift.
- Remind me of my real motivation. The underlying reason(s) that I am trying to sell this property probably were not related solely to price. Remind me of the problem I was trying to solve.
- If the market is dropping, it’s best to be ahead of the curve. Suggest a price that you really believe will result in generating activity from the buyers that will eventually pay the most for my property. Too often, Sellers follow the market down with small changes in price. This often results in extending the sale cycle, and eventually costing the seller more money than is necessary.
- Be willing to walk away from a deal that you believe has limited potential of reaching the Seller’s required pricing. Your only real asset is time, invest your time in finding deals that have a high chance for success.
- Do it now! I’m not making market predictions but, if you believe the market is moving against your Seller, then every day you wait could cost your client more money.
It’s never easy to ask for a price reduction but, true service to your client means being honest about the condition of the market, and the value of the property. Your goal is to assist your client in achieving his/her goals. Be strong enough to help them see the path to success, and you will close more deals and build strong client relationships.
Happy Hunting!
Joe
Joe Faris
KJF Partners, Inc.
Cell Phone: 949-275-5038
Email: jfaris@kjfpartners.com
Website: www.kjfpartners.com
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