Get the listings you want at the commission you want

Let’s review some basics facts: WHAT IS A CMA? It is a direct comparison of the subject property to nearby and similar recently sold properties to determine current market value.

WHAT IS THE PURPOSE OF A CMA? To determine the FAIR MARKET VALUE and establish a realistic value for the subject property based on historical data.

WHAT IS FAIR MARKET VALUE? What a willing buyer will pay and what a willing seller will accept in a reasonable amount of time when exposed to the market. I have a philosophy that all real estate sells for Market Value:

The challenges are having the skills to establish the list price and where it should be positioned in the market plus the Seller’s approval for the price you recommend based on statistical data.

Here’s why it is so critical that you get the home priced RIGHT the first time:

1. Time and Days on market – overpriced listings sit too long.
2. Your time and costs to market – it’s your money you’re spending.
3. Your reputation as a sales professional is at risk – it’s your name on the sign when the house sits on the market.
4. You will get a reputation for overpricing listings just to get the listings.
5. Property doesn’t sell in the client’s specified time frame.
6. Clients become disenchanted with you and either let the listing expire or worse, give the listing to another agent, who then prices right and it sells FAST!
7. You lose all the opportunities for referrals to business on a lost and dissatisfied client.

Overpricing a listing can be a REALLY BAD IDEA!

Why is it critical for the Seller to price the home right the first time?

1. The home becomes stigmatized when it sits too long. People ask “What’s wrong with the house? “ No one assumes it’s the pricing!
2. Prevents a sale within a reasonable time frame, so seller cannot move ahead with plans or potential savings.
3. The price continues to drop the longer it is on the market
4. Can sell below market value
5. Buyers and agents are reluctant to make low offers on overpriced listings.

Keep in mind the most brilliant marketing strategy plan can’t sell an overpriced listing! Do you really want to spend money, and time marketing a property that has zero chance of selling at the vendor assisted price?

Understand the comps on MLS® and what the information does for you.

• SOLDS: Recent MLS® Sales are your true market value.
• ACTIVE (Every active listing is competition): Remember a Seller only has 1 house to SELL. A buyer has many houses to choose from.
• EXPIRED LISTING (what the market will NOT PAY): These are the homes that didn’t sell. The seller lost the sales game, and this is a good indicator of where not to price the home.

Articulate the importance of positioning the property on the market right the first time based on this information, and have the necessary skills to list at or near the Market Value. Rely on the historical data and market data to form the basis of your CMA.

Never give a definite PRICE - always provide a range and try to hold off the pricing conversation until the end of your marketing presentation. You might say:

• “Mr. & Mrs. Seller, if you’re comfortable with my marketing plan, and me, let’s go ahead and look at the positioning the house on the market with the proper price together.”
• “Most sellers only want to know, “How long will it take to sell and how much money will we get?” I hope you want more. I hope you want to know the level of service I provide, and how a full service brokerage works.”
• “Together we will establish the price based on all the material and comparables I have here today. Pricing is an art of active involvement with the sellers and the agent. Let’s get started.”
• “Mr and Mrs Seller, a critical factor to keep in mind when pricing a home is timing. A property attracts the most excitement and interest when it’s first listed. Improper pricing at the initial listing time will miss out on the peak interest period.”
• “Mr. & Mrs. Seller, never use price as criteria for the selection of a listing agent.”
• “Mr and Mrs Seller, your home has the highest chances for a successful sale when it is new on the market and priced reasonably for the market.”

Use charts, graphs and data to demonstrate your understanding of the market price for their home.

1. Explain to your client the absorption rate of homes in their price point
2. Demonstrate the downward slide of an overpriced listing and how it will go below market value.
3. Ask what is most important TIME or MONEY.
4. Money – list higher side range- longer on market.
5. Time – list lower – shorter time on market.

Pricing a property right the first time is a big deal and requires skills. Let the Seller know that overpriced listings cause weeks and months of wasted effort and money for everyone. They will be tired of having the house clean and ready for showings at all times, but worse, the overpriced listing may not get any showings. agents stop calling, showings dry up and the Seller blames the agent for not counselling them on pricing too high.

In the end the listing either expires or gets cancelled. Another skilled agent takes the listing and reduces the price to align with market value. That agent gets all the referrals and future business.

Be a skilled professional and set yourself up for successfully listing the property by pricing and positioning the home to best serve your client.