As a real estate professional you know that over listing a property is almost always non-productive. If your comparative market analysis shows that the fair market value is significantly lower than the list price, then few buyers will bother to view the home or make an offer.
The challenge is helping your seller to see the benefits of a more reasonable price. As with most negotiations, the most successful outcome will be achieved when you are armed with facts that help neutralize emotions. The first step is to determine why the seller seems set on the higher price. Generally these reasons fall into a few broad categories:
– Worry about negotiations/having to compromise on a low price
– Unrealistic view of home strengths and weaknesses
– Desire to recoup the costs of renovations
– Significant need for money/financial relief
– Not motivated to move
All of these reasons have an emotional basis and it is important to acknowledge the concerns. Using current market analysis, you should be able to demonstrate that a more reasonable price would address nearly all of these concerns since shorter time on the market is the best financial outcome for the seller.
– Create a balance sheet – real dollars and cents to your seller – of the costs in sticking to a high price and show that those costs will never be recovered if no viable offers are received.
– Estimate the net proceeds of the sale so that your seller will have a concrete incentive to work towards.
– Show your seller that over-listing actually helps the competition (other sellers) which is a significant disadvantage.
And if the seller still resists setting a more reasonable price,
– Persuade them to agree on a scheduled length of time for the high price as well as the lower amounts and durations of stepping the price down to something more reasonable.