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Pricing in a High-Rate Market—Exactly What to Do · The Real Estate Agent Playbook

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  17.5% of all active listings experienced a price cut
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  and that doesn't even include
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  the 50 to 60% of homes that are offering concessions
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  or taking below list price
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  we
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  as agents have to understand that we are the experts
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  and we need to price homes a little bit differently
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  especially in these high rate markets
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  let's talk about it
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  what's up guys Jeremy Kane
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  the real estate agent playbook
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  helping you win every single day
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  at the game of real Estate
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  I have helped agents just like you
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  do exactly what it takes to build their business
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  to scale it to one deal a month to 50 deals a year
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  to whatever that looks like for you and your spot
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  so if you're interested in that
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  please reach out I would love to help you
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  and help you reach those goals
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  that you have in real estate production
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  but let's really kind of dial in what we are looking at
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  traditionally over the past 10 years
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  we would go into a home we'd have our traditional CMA
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  it would basically say okay
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  these are the comparables for your neighborhood
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  this is what the home sold for
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  you know
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  across the street that had similar square footage
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  let's go you know
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  at that price or a little bit higher
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  the buyers would flood in
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  they'd offer up prices and so on
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  and here we are right
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  we have been pricing homes just like that for 10 years
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  there was very little repercussion for pricing high
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  because once you dropped it into the
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  you know sweet point pricing
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  you would then have those multiple offers
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  and possibly even get it bid up further
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  but now things have changed
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  there's less buyers there's less bitters
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  and we have to take a different approach
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  to understanding
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  how we are going to actively market this listing
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  and get the top dollar for the seller
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  please remember and I've said this all along
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  the home is worth what a buyer's willing to pay for
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  and a seller's willing to sell it for right
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  so the market dictates the pricing
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  I also use a term that
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  a listing price is not a price tag
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  it's a starting point right
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  it's a conversation starter
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  it's not like you know
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  you can pull a house off the shelf
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  and go pay exactly what it's listed for
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  even builders are you know
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  negotiating at this phase of the game
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  so we have to understand and change exactly what we're
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  doing
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  what I typically do is we start with that approach
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  obviously the price per square foot and what's going on
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  we contact the listing agents of those homes that sold
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  how was your activity did you have multiple offers
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  those kind of things because those are all indicators
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  of the demand in the price
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  so we as agents have to now collect more demand
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  because we can't just see the demand right
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  we can't see a 6:00 50 list
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  price and a 6 75 sold price you know
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  three days after being on the market
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  because sometimes that's just not the case
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  sometimes that's still there
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  but likely it's three to four weeks on the market
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  and then you know
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  seller concessions and the math works out
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  and sometimes it's over list and more concessions
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  and and so we have to dive into these more
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  because there's just more variables
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  going into what people are offering
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  and why are there more variables
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  because the buyer's monthly payment is at
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  the forefront of what they're concerned about
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  right now when I'm at a listing appointment
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  we talk about the price we look at the comparables
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  we kind of say this and once we've come to a price
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  and we've done the pricing strategy
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  I then show the seller
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  exactly what the buyer is going to be paying
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  this is a jaw dropping number
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  if the seller has been in the home more than two years
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  right with the raise of the interest rates
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  with the continued appreciation
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  typically people being in their homes five to 10 years
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  and buying with those 2 to 3% interest rates
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  at the lower price point
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  you had an appreciation and the higher interest rate
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  it gives the sellers a little bit of a perspective
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  and where I go with this is okay
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  here's what's going on
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  buyers are beating sellers up on the list price
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  and then they're beating them up again on the
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  inspection so if we can get ahead of the inspection
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  we can put that new roof on
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  we can grab that new furnace just because it's old
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  grab that new water heater because it's outdated
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  those are all things that we need to take into account
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  as we start to understand exactly what's going on
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  in our market
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  but it starts with that buyer's monthly payment right
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  and as we you know
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  push then we can go into hyper local
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  right as we have more days on market
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  more data and more showings
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  and more feedback than we've ever had before right
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  because no one did feedback when it was the wild
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  wild west and no one called on it
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  because we were under contract before
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  we could get the feedback right
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  the feedback was the offers
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  and so now we have to go hyper local
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  let's talk about feedback
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  let's go check out the homes that are actively listed
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  that are our competition let's talk to those agents
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  and talk about their activity
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  compared to their price and our price right
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  and let's get as much hyper local data
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  days on market trends all of the things that we need to
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  actively give a proper picture to the seller
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  right so that we can actually market the price
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  property appropriately
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  because ultimately what we do see is some
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  you know race to the bottom right
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  some agents have no idea what to do
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  and they just lower the price
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  that is not the only thing that we need to be doing
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  in this market if you're at a point where you know
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  you can get an appraisal based on the data
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  please please do not race to the bottom
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  unless your clients absolutely have to sell
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  cause homes are just sitting on the market
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  a little bit longer right
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  so you have to hold strong a little bit
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  as long as you have the data to represent it
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  and you have the activity that you need from the hyper
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  local markets and then let's use listing metrics right
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  let's use the reverse prospecting tool in our MLS
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  to reach out to see how many
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  you know people are actually opening the you know
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  auto email that sent to them
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  how many people are favoriting on heaven for forbid
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  Zillow I
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  I know that this works because I just recently
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  got a membership with homes.com
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  and within the first 2 hours
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  two days right
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  I had a listing that had been on the market
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  I have no idea if it was a listing or a homes.com
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  you know something
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  but that house went under contract that weekend
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  after being on the market for 70 days for
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  you know
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  above list price with a a little bit of a concession
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  right and then
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  I had a listing that had been sitting for a while
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  that had three showings
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  and it hadn't had showings in three weeks
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  four weeks and so these platforms that are
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  you know their whole job is to drive the algorithm and
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  you know boost listings and those kind of things
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  do it a little bit better
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  than some of the organic stuff that we can do
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  and if it's cost effective
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  it's a massive you know
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  pat on the back when your sellers see hey
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  your your listing got 16,000 views
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  you know last week
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  that's huge right
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  so we're pushing it we're putting it in front of people
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  and then you have the data to actually say okay
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  16,000 people saw it on homes
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  another 10,000 saw it on Zillow and another
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  you know whatever it is
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  450 agents had it saved in their search
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  and we had three favorites
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  you know two of them saw it and didn't offer
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  then we're talking about enough data to say okay
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  we might not be hitting the Mark on price
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  right instead of just being like
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  oh it's been on for five days
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  it cleared that first weekend
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  so let's drop it 10 grand oh
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  cleared the next weekend let's drop it 10 grand
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  that's not what we need to be doing
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  and then when we have this data
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  we can certainly use the feedback
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  and use those things to have an educated
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  data driven conversation which is where we need to go
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  so if you start with the data
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  start with what the buyer is going to pay
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  at that list price
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  so that they understand what they're coming into
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  get ahead of the inspection
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  and then provide enough information and data for
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  you know enough eyeballs to see it to see
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  show them how many people were
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  putting this listing in front of and
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  and what we're doing
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  in addition to just posting it on the MLS
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  then as we work through this
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  we look at the data
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  and we have data to make educational decisions
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  on price reductions and
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  you know
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  updating or whatever we need to do for the listing
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  so if your traffic stats are not at the forefront
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  and you're showing that as not at the forefront
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  reach out I would love to help you put together a plan
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  so that you can not only do the delayed marketing
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  that we've talked about in this
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  you know series
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  but also take the data and have those conversations
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  where it's not just like well
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  we should lower the price why well
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  you know we've been on for 5 days
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  we want to eliminate those
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  and bring more value to our clients
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  so if you have any questions
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  I can help you set up your system
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  I would love to do so
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  please reach out until then like comment
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  subscribe on the channel and we'll see you next time
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  bye bye