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Why More Marketing Won’t Sell an Overpriced Listing · Success Is Not Convenient

• 0:00
  SPEAKER_00: Hello everybody, Bernie Gallorani bringing you an episode of Success is Not Convenient.
• 0:05
  SPEAKER_00: So here's our topic today, right?
• 0:07
  SPEAKER_00: Price sells houses.
• 0:08
  SPEAKER_00: Marketing exposes them.
• 0:11
  SPEAKER_00: Price sells houses.
• 0:13
  SPEAKER_00: Break that one down.
• 0:14
  SPEAKER_00: The price that you put on the home is actually what sells the house, but the marketing that you do exposes that to the buyer.
• 0:21
  SPEAKER_00: So let me start with something that some real estate agents aren't going to like hearing very well.
• 0:28
  SPEAKER_00: Marketing doesn't sell an overpriced house, it just exposes how overpriced it is.
• 0:34
  SPEAKER_00: Hear me out.
• 0:36
  SPEAKER_00: You overprice a property, you do whatever you call marketing to the property, and it just exposes it to all the buyers that it's overpriced.
• 0:44
  SPEAKER_00: And then what happens is you just keep it on the market day in and day out, week in and week out, month in and month out.
• 0:48
  SPEAKER_00: And you're like, wait a minute, I've already got the answer.
• 0:50
  SPEAKER_00: The buyers aren't even showing up to my house, but I'm just going to keep it there.
• 0:53
  SPEAKER_00: I believe one of the biggest problems in real estate today is that the agent thinks that when a home isn't selling, the answer is more marketing, more social media, more pictures, another open house, another video.
• 1:06
  SPEAKER_00: But here's what I want every agent to understand.
• 1:09
  SPEAKER_00: Marketing creates exposure, but price creates interest and value creates offers.
• 1:16
  SPEAKER_00: Let me say this to you again.
• 1:17
  SPEAKER_00: Marketing the home creates the exposure.
• 1:21
  SPEAKER_00: Price creates the interest, and value creates the offer.
• 1:25
  SPEAKER_00: And if you don't understand the difference, you're going to struggle to get all of your listing sold.
• 1:31
  SPEAKER_00: So here are a few things I want you to write down.
• 1:34
  SPEAKER_00: Number one, buyers don't care about how hard you market the home.
• 1:38
  SPEAKER_00: Buyers don't care like the effort you put in to marketing the home.
• 1:41
  SPEAKER_00: The buyer has no concern over that at all.
• 1:44
  SPEAKER_00: Think about how buyers shop for homes.
• 1:47
  SPEAKER_00: They look at the pictures, the location, the condition, the square footage, and then they look and compare the prices.
• 1:53
  SPEAKER_00: Is that fair?
• 1:54
  SPEAKER_00: But it could be like based on algorithm or how they're searching for homes based on their search criteria.
• 1:59
  SPEAKER_00: If your listing is at$550,000 and there are three similar homes that are for sale or available for$500,000, why would they choose yours?
• 2:10
  SPEAKER_00: Is it because the seller wanted more?
• 2:12
  SPEAKER_00: The seller's emotionally attached to the property?
• 2:15
  SPEAKER_00: No.
• 2:16
  SPEAKER_00: You guys know as well as I do, the seller always typically has a higher price in mind than the agent believes it's worth.
• 2:23
  SPEAKER_00: And we're probably both wrong because the only one that really matters is the buyer.
• 2:28
  SPEAKER_00: So you can have the best photography, the best video, the best marketing plan in town.
• 2:33
  SPEAKER_00: You could have the top-notch triple A marketing plan, but buyers don't purchase homes because of how hard you market them.
• 2:41
  SPEAKER_00: They only purchase homes because they see value.
• 2:44
  SPEAKER_00: You know, I was doing a role play earlier today with one of my agents, and the agents talked about how important they felt it was in this role play, how important it was that the home had lots of people liking it online.
• 2:58
  SPEAKER_00: I said, Well, are you looking for likes or are you looking for offers?
• 3:02
  SPEAKER_00: Those are two different things.
• 3:03
  SPEAKER_00: You can get a lot of likes, right?
• 3:05
  SPEAKER_00: But you're looking for offers.
• 3:08
  SPEAKER_00: And so what I want you guys to all understand is the per the when they purchase homes because they see value in the home.
• 3:15
  SPEAKER_00: It's not the marketing, it's the value.
• 3:17
  SPEAKER_00: And that's what agents need to understand.
• 3:20
  SPEAKER_00: Here's number two for you more marketing doesn't fix overpricing.
• 3:24
  SPEAKER_00: Here's the question for you.
• 3:26
  SPEAKER_00: If a thousand qualified buyers have seen your listing and nobody makes an offer, do you really think another thousand buyers are going to solve your problem?
• 3:36
  SPEAKER_00: Well, maybe.
• 3:37
  SPEAKER_00: I mean, there's always needles in a haystack.
• 3:39
  SPEAKER_00: Sometimes uh 1,500 or 1,800 or 1,900 buyers can say no, and then the 1901 walks in and says, I love the property.
• 3:48
  SPEAKER_00: That can happen, but the reality to it is it's not likely.
• 3:53
  SPEAKER_00: So the real question is if it's the if it's a needle in a haystack, are you hanging your hat on that probability?
• 3:59
  SPEAKER_00: Maybe your marketing is already working.
• 4:02
  SPEAKER_00: Maybe the marketing is effective.
• 4:04
  SPEAKER_00: Maybe buyers are seeing the property, comparing it to the competition, and they decided that they can get more for their money buying another property, buying somewhere else.
• 4:13
  SPEAKER_00: So it's not like your marketing didn't expose the buyer to see it, that the marketing didn't cause the home to sell because the price condition of the home is what causes the property to sell.
• 4:24
  SPEAKER_00: Your exposure and marketing just gets them to see the home.
• 4:28
  SPEAKER_00: See, a house on a busy road can sell.
• 4:31
  SPEAKER_00: An outdated house can sell.
• 4:33
  SPEAKER_00: A house with terrible floor plan can sell.
• 4:36
  SPEAKER_00: I mean, right?
• 4:36
  SPEAKER_00: There's, you know, that thing, ugly houses, right?
• 4:38
  SPEAKER_00: Why buy ugly houses?
• 4:39
  SPEAKER_00: There's buyers for everything.
• 4:41
  SPEAKER_00: But the price has to reflect those disadvantages.
• 4:45
  SPEAKER_00: I did a podcast once talking about a house on a busy road.
• 4:49
  SPEAKER_00: It's going to range between 5 and 12% of a discount if it's on a really busy road, depending on how busy that road is.
• 4:55
  SPEAKER_00: So that seller may want top notch for an interior house, but it's on a busy road, and most people don't want to live on a busy road.
• 5:02
  SPEAKER_00: So that's a disadvantage for that particular piece of property, which is always affected within the price.
• 5:07
  SPEAKER_00: Almost every property problem can become a pricing problem when the seller refuses to recognize how buyers see the home.
• 5:17
  SPEAKER_00: See, I think this is where we come in.
• 5:20
  SPEAKER_00: Our job is to share with the seller how buyers perceive value in a home.
• 5:25
  SPEAKER_00: Not what the homeowner believes is possible, but it's our job to then share with them the things that actually cause buyers to say yes to their property.
• 5:35
  SPEAKER_00: Here's number three agents hide behind marketing because they're afraid.
• 5:41
  SPEAKER_00: They're afraid of what?
• 5:42
  SPEAKER_00: Now, here's where I want to challenge all of you guys.
• 5:45
  SPEAKER_00: I believe one of the biggest reasons agents suggest more marketing is because they're afraid to have a conversation that they really need to have with that seller.
• 5:56
  SPEAKER_00: And that's about the price.
• 5:58
  SPEAKER_00: It's easier to do, I'm gonna do more of this and more of that, and then not adjust the price.
• 6:03
  SPEAKER_00: What's easier?
• 6:04
  SPEAKER_00: Calling the seller and saying, let's do another open house?
• 6:07
  SPEAKER_00: Or saying, based on the buyer's response in competition in the area, that we're overpriced and we need to make an adjustment in that price.
• 6:15
  SPEAKER_00: Ooh, those are scary words.
• 6:17
  SPEAKER_00: One conversation makes the seller feel good, and the other might actually get the house sold.
• 6:22
  SPEAKER_00: What are you trying to do?
• 6:23
  SPEAKER_00: Hear me.
• 6:24
  SPEAKER_00: One conversation in there makes the seller feel good.
• 6:27
  SPEAKER_00: I'll do another open house.
• 6:29
  SPEAKER_00: The other one maybe makes you feel uncomfortable, and maybe the seller feels a little uncomfortable.
• 6:36
  SPEAKER_00: But the second option actually gets the house sold.
• 6:39
  SPEAKER_00: See, too many agents are more concerned about keeping their sellers comfortable than telling them the truth.
• 6:45
  SPEAKER_00: I don't want to beat you up on this because I do this quite a bit, where telling them the truth is the key thing and selling houses.
• 6:52
  SPEAKER_00: You weren't hired to agree with the seller, you were actually hired to get the house sold.
• 6:57
  SPEAKER_00: So just ask yourself this question.
• 6:59
  SPEAKER_00: I'm the listing agent, I'm representing this particular home.
• 7:02
  SPEAKER_00: What does the seller expect from me?
• 7:05
  SPEAKER_00: And I think the only answer you can give is to get the home sold.
• 7:08
  SPEAKER_00: Now, yes, they want communication, they want hard work, but you're gonna work a lot harder with an overpriced listing.
• 7:15
  SPEAKER_00: You're gonna work less time and you know, think about this.
• 7:18
  SPEAKER_00: If you sell a home in one week, it closes in 30 days, you have five weeks in that property and you get paid.
• 7:25
  SPEAKER_00: If you have a home for 90 days and you have another month of closing, you have four months of doing the same work and you get paid hopefully the same.
• 7:34
  SPEAKER_00: But the longer it takes you to sell it is when the seller, the more price adjustments you have to keep asking for, the seller's gonna continue to keep asking you to adjust your commission.
• 7:42
  SPEAKER_00: And then you're gonna end up having it for five or six months and then making less money than you would have if you could sold it in five weeks.
• 7:47
  SPEAKER_00: You guys follow what I'm saying?
• 7:49
  SPEAKER_00: It's our behavior as realtors that's the problem.
• 7:51
  SPEAKER_00: We actually get paid less money, not even if our commissions get adjusted, but the longer we have the listing and the more work we have to do, if we're getting paid based on a per hour uh rate, we're losing money on this deal.
• 8:04
  SPEAKER_00: So let's just do the right thing right up front.
• 8:07
  SPEAKER_00: See, you weren't hired to agree with a seller, you were hired just to get the household.
• 8:11
  SPEAKER_00: And sometimes that requires an uncomfortable conversation.
• 8:15
  SPEAKER_00: Sometimes it does.
• 8:15
  SPEAKER_00: And the question is, are you willing to do it?
• 8:18
  SPEAKER_00: Here's number four it says the buyer determines value, not the seller.
• 8:22
  SPEAKER_00: I love that.
• 8:24
  SPEAKER_00: I'm gonna give you an example of what I mean.
• 8:26
  SPEAKER_00: I try to share with all my agents that there are three options of value, and I want everyone to write this down.
• 8:32
  SPEAKER_00: There are three options of value.
• 8:35
  SPEAKER_00: First, the seller's opinion.
• 8:37
  SPEAKER_00: The seller's opinion is based on what they paid for the home, any improvements that they've made to the property, and what they think the home is worth.
• 8:46
  SPEAKER_00: And how they value some of that other stuff is emotional connection.
• 8:51
  SPEAKER_00: They raise their family, their neighbors they think sold for X amount, my house is better than theirs.
• 8:56
  SPEAKER_00: They just come up with some probably fantasy land ideas of value.
• 9:00
  SPEAKER_00: And a lot of times it might be, well, I need this one.
• 9:02
  SPEAKER_00: They've already pre-calculated what they need because they're moving to a new home.
• 9:06
  SPEAKER_00: So they've actually spent all of their money before the agents ever showed up.
• 9:09
  SPEAKER_00: They actually know in their head or believe what that house is worth.
• 9:13
  SPEAKER_00: The second valuation of the home's value is the agent's opinion.
• 9:19
  SPEAKER_00: And that's based on the comparable sales, the current competition of what's going on, and the market conditions.
• 9:25
  SPEAKER_00: So we're looking at it and we're looking at price per square foot area, and we said, okay, how much is this going to bring?
• 9:30
  SPEAKER_00: But ours are just based on numbers, and we're still guessing.
• 9:33
  SPEAKER_00: I think we would all agree to that.
• 9:35
  SPEAKER_00: And then the third is the buyer's opinion of value.
• 9:38
  SPEAKER_00: The buyer compares the available properties and then decides which of those offers is best value for them.
• 9:46
  SPEAKER_00: Now let me ask you something.
• 9:47
  SPEAKER_00: Which one of those three opinions actually determine whether a home sells?
• 9:53
  SPEAKER_00: It's the buyer's opinion, which means the seller's opinion and our opinion are irrelevant.
• 9:58
  SPEAKER_00: Seller's opinion is emotion, the agent's opinion is logical numbers, and the buyer's opinion is based on availability and condition of home.
• 10:08
  SPEAKER_00: The seller can want any price they choose, and the agent can recommend any price they want.
• 10:14
  SPEAKER_00: But until a buyer sees value, you don't have a sale.
• 10:19
  SPEAKER_00: And for us to say it's a down market, it's the interest rates, it's this, it's that, people wake up.
• 10:25
  SPEAKER_00: Stop confusing yourself.
• 10:28
  SPEAKER_00: We continually tell ourselves a story to prevent ourselves from having a difficult conversation on price to our seller.
• 10:36
  SPEAKER_00: I don't understand it.
• 10:37
  SPEAKER_00: It's not how I operate, so I get confused when I hear agents and I've talked to agents about this stuff all the time.
• 10:42
  SPEAKER_00: And I promise you, if you called me, emailed me, or anything, I would actually change your mind about it too.
• 10:47
  SPEAKER_00: Here's number five.
• 10:48
  SPEAKER_00: Stop avoiding the price adjustment conversation.
• 10:51
  SPEAKER_00: Here's something else that is tough to understand.
• 10:55
  SPEAKER_00: Why does it take some agents 60, 90 days to tell a seller what everybody already knew the first two weeks?
• 11:03
  SPEAKER_00: I'm going to say this again.
• 11:04
  SPEAKER_00: Why do we take 60 to 90 days to inform and communicate with a seller what everybody in the market already knew?
• 11:13
  SPEAKER_00: It's because we're afraid of confrontation.
• 11:16
  SPEAKER_00: They don't want the sellers to be upset.
• 11:18
  SPEAKER_00: They're afraid that the sellers will lose, that they'll lose the listing to the seller, a seller will go somewhere else.
• 11:23
  SPEAKER_00: But let me ask you this question.
• 11:25
  SPEAKER_00: Would you rather have a seller upset with you for five minutes or disappointed in you for three months because you couldn't sell the particular property?
• 11:34
  SPEAKER_00: Guys, understand this.
• 11:36
  SPEAKER_00: You listed the home and they had confidence in you that you were going to do the job.
• 11:40
  SPEAKER_00: If you don't know or didn't know that the house needed to be adjusted, learn the techniques and pay attention to the market stats and get educated on what it takes.
• 11:51
  SPEAKER_00: If you know what it takes and you're not having the conversation, then you're creating real estate malpractice and you should be fired from that listing and probably not be a listing agent at all.
• 12:02
  SPEAKER_00: And that's the reality to it.
• 12:04
  SPEAKER_00: If you're taking 90 to 120 days to sell a house, I'm not saying that you aren't going to have one for 90 to 120 days.
• 12:11
  SPEAKER_00: I'm just asking you what are your steps in those conversations?
• 12:14
  SPEAKER_00: You could have a listing and the seller just doesn't choose to give it to you, and that's okay.
• 12:17
  SPEAKER_00: You can choose to get rid of the listing, and that's okay.
• 12:20
  SPEAKER_00: But if you're not doing anything about it and you're not practicing your skills, you're not getting educated on the market, then you're just creating malpractice.
• 12:27
  SPEAKER_00: See, good agents monitor showings, buyers feedback, competing properties, all the market activity.
• 12:34
  SPEAKER_00: And when the information tells them the price is wrong, they have the conversation with the seller.
• 12:40
  SPEAKER_00: They don't wait, they don't hide, and they don't substitute another open house for conversations that they should already be having.
• 12:49
  SPEAKER_00: Have the conversation, do the right thing.
• 12:52
  SPEAKER_00: Here's number six your value is your knowledge, not your marketing.
• 12:59
  SPEAKER_00: If we're going in there and talking about a marketing plan and we don't have a lot of value in how it takes to get it sold, marketing doesn't sell the home, price does.
• 13:08
  SPEAKER_00: That's the title.
• 13:09
  SPEAKER_00: Marketing exposes the home, price is what actually sells it.
• 13:13
  SPEAKER_00: You could be doing a good job marketing, but you still aren't selling the home.
• 13:16
  SPEAKER_00: And the only thing that really matters is whether or not you get the home sold for the seller.
• 13:20
  SPEAKER_00: Let me finish with this.
• 13:22
  SPEAKER_00: Too many agents walk into a listing appointment, spending most of their time selling their marketing plan.
• 13:29
  SPEAKER_00: The pictures, the websites, the videos, and the open houses.
• 13:34
  SPEAKER_00: And that's fine because marketing is important and it matters.
• 13:37
  SPEAKER_00: But the real value of great listing agents is knowing how to position a home against all of the competition.
• 13:45
  SPEAKER_00: So a buyer chooses it versus another house.
• 13:49
  SPEAKER_00: Great agents understand pricing, they understand buyers' behavior, and they know how to have a difficult conversation with these sellers if they need to have it.
• 13:57
  SPEAKER_00: They don't just tell the seller what they want to hear, they tell the seller what they need to know to get the home sold.
• 14:06
  SPEAKER_00: So the next time you have a listing that's sitting on the market, ask yourself this one question.
• 14:12
  SPEAKER_00: Do I really have a marketing problem?
• 14:15
  SPEAKER_00: Or am I just afraid of having a pricing conversation?
• 14:20
  SPEAKER_00: Because there is a big difference between those two things.
• 14:23
  SPEAKER_00: And remember this marketing exposes the home, price creates the opportunity, value motivates the buyer, and a great listing agent knows the difference.
• 14:34
  SPEAKER_00: That's how you get a home sold.
• 14:36
  SPEAKER_00: I hope everybody has found value in this today.
• 14:39
  SPEAKER_00: Please hit the like button or the subscribe button.
• 14:42
  SPEAKER_00: We'd love to continue to keep bringing all these to you.
• 14:45
  SPEAKER_00: Hope everybody has a great day.