You call an expired lead or reach out to them. You get a meeting with them.
It turns out, their home is overpriced, but they won't lower.
From the outside, it looks like this held the sale back. They could even have gotten a couple of offers but they were too low.
The best course of action is to convince them to lower the price. It's easier said than done.
But if they don't agree with that at first, in some cases you should still take the listing, and work their price down throughout the listing process.
We’ve all seen the owners of an expired listing or just a home that won’t sell who are convinced the home will sell at the price they want.
They’re hard headed about this, not wanting to compromise, blaming it on other factors, like the agent and the market.
Now it’s up to you to convince them to reduce the price. With certain owners, this might seem almost impossible.
Know the difference between owners that you'll be able to convince and owners who you shouldn't work with at all.
There is nothing crazier than seeing another real estate agent list a house for $450,000 that comps out at $250,000.
Agents get so desperate for business that they’ll take anything they can get. The key to success in real estate is just like anything else.
You have to select the good customers and get rid of the rest. Banks do this when they reject the bad borrowers and only lend to the ones most likely to pay.
Motivation is the most important thing while deciding whether to take a listing or not. Ask them where they are moving.
Then ask why they are moving. Then ask what’s important to them about the move.
If the most important thing is to make the most money on the sale, it might be a problem.
If they have that tone, they may never sell until they get the right offer. And that could be a while if it was overpriced once.
Motivated sellers will say they are selling because of family, new job or other real or emotional reasons that are just not about cashing out.
Go through the process of proving the home won't sell with their price.
You're going to have to show them instead of convincing them just by talking.
Start with a couple of simple things that you can do once you win the expired, or just overpriced, listing.
Improve the showing condition of the home.
A “staged” home will sell for 10-15% more than a home that isn’t staged. A home in good showing condition (but not staged) will sell for 10-11% more than a dump. Stage the home and get it ready for showings.
This will improve its online value as well for virtual tours and pictures.
Improve the marketing.
Take better pictures and write better descriptions. Offer something like a real “marketing analysis” and figure out any marketing opportunities there are that the other agent has missed.
Take steps to improve each part of the house, its marketing and anything else.
Because after these things are in place, and if the home doesn’t sell, you’ll be that much closer to the owner reducing the listing price.
Eventually, you can finally reduce the price. This still will take time usually.
Not yet, however. Many sellers still think their home is worth the expired price.
After years of our agents working and learning how to deal with it, and we learned not to fight over the price….at first or even that soon. This is a situation where you could lose the listing fairly quickly.
Treat it delicately.
So instead of trying to get it lowered at first, you prepare for it not to sell for a little, improve all the marketing and do everything that you can do make it the most appealing, then you start to haggle over the price.
Our agents have lost a whole lot of commission fighting over the price.
It’s one of the most expensive lessons we’ve ever learned.
So, why do we say that the reason homes don’t sell is that of bad marketing? Because that is what most sellers think.
Most sellers think the agent messed up. Or, the agent didn’t “stay on top of things."
First, call the seller every week, or twice a week to tell him any updates and everything you are doing to improve how attractive the listing is.
This will build rapport and keep him happy as a seller.
The short five-minute conversations every week build a lot of rapport and makes them feel more comfortable and trusting.
Then show him a solid system that is proven in other circumstances, this will keep the pressure on the seller to reduce the price.
You build your relationship with the seller when you deliver the updates.
When you call them each week, simply tell them that we didn’t have any showings.
Or we did, but none sold and say that other homes are still selling and we might need to reduce the price.
Follow up on showings fast.
Call the seller when you hear the feedback from a showing.
This is the perfect time to ask for a price reduction if they haven’t been getting any interest in a few weeks.
Then ask for a price reduction every 20 days or three weeks or so. You have to be sure only to mention this or ask that far apart.
You don’t want them thinking “every time my realtor calls it’s just to reduce the price."
Don’t take small price reductions.
If you reduce a home from $659,000 to $654,900, it won’t make any difference.
Turn down the tiny price reductions until you get the 5-10% that will cause the home to sell.
If you go from $659,000 to $599,000 that is a meaningful price reduction that will make a difference.
Another good strategy is to try and reduce the price to a number that will jump out at buyers, or they’ll look for. Don’t round down from $365,000 to 352,000.
Round down to $350,000; a solid number buyers may have had in or around their mind.
The next step is to send them an updated CMA whenever necessary.
It can be each three weeks or over a month between each time. Not being too pushy with reductions gets the job done better.
If they are being very resistant and you know you have to be pushy, push lightly but also send them an updated CMA and other competitive active listings to them in the mail.
E-mail doesn’t work because they can just delete it.
This can finally prove to some owners that this price has to be reduced. Send them the copies of any marketing you’re doing, and direct them to anything online.
Just keep reminding them nothing else can be done.
This is almost all you can do but still, the most important thing to do is be on their side while making sure they know this very well.
Tell them that you don’t want to reduce the price, but the market is telling us that is what must be done.
Treating these situations with the right amount of finesse and delicacy will work out for you so much in the end.
Don’t ask for a reduction constantly, but stay in constant contact with them and make it clear that you’ve tried everything else, and there are no other options.
That was the best way to deal with an expired's objection, but it's only for certain situations.
Check out this training that we'll do with you about mastering all aspects of expired listings.
This is what you'll learn:
- How to position yourself above your competition so the Expired can’t help but choose you to sell their home.
- Step-by-step instructions on how to build an expired listing marketing package.
- How to avoid the fatal mistake that most agents make with Expireds. If you’re wondering why sellers don’t treat you with respect, then this will be an eye opener!
- How to stand out from everyone else so Expireds call you instead of your competition.
- What to do to cause sellers to drive to YOUR office and meet you to sign the listing contract instead of you having to go to them.
- How to implement everything quickly and easily so you can start taking listings fast.
Click the link below to sign up.
Joe Nickelson is a real estate professional dedicated to helping home buyers and sellers achieve their dreams of owning property, and helping real estate agents stop using the sometimes-vicious tactics that weigh on their consciences. He believes that the Smart Agents books will, quite literally, change people’s lives for the better. Check out his full bio here!