FOR SALE or ON SALE!
July 5th, 2010
Real Estate things that make you go Hmmm PART I
1. The FOR SALE sign out front has a price on it.
Why?
As Real Estate agents, we are marketers of a property, not a corner store.
Ultimately, it’s up to the seller if the property sells, our task is to wisely, timely, speedily, accurately and for value let as many other agents / people / potential buyers know that a certain property is “on the market.”
To my way if thinking this (ie; price on the sign) just sends contradictory messages about what value a Real Estate Agent is to a property seller.
In many cases this just helps to reinforces the idea that Private Sellers have “just stick a sign out the front with a price on it.” (have you ever noticed how many Private Sellers signs have the price on them?)
The downside of this method is no different than that other one that property buyers are always on the “lookout” for. And that is, the property with 2 or 3 or 4 different companies For Sale signs out front.
For that “scouting” buyer, nothing signals desperate seller more than this. It just yells out that the seller is a “too motivated” seller.
In my experience this is not something that every seller wants, or in fact should, impart to potential buyers.
From any associated experience I have had with these types of sales, 95% of the time all this “marketing?” method does is encourage the “ooh they’re desperate, let’s make a low offer?” type of buyers.
If that’s what the seller wants, then fine.
I suspect as part of the Kiwi psyche, that in recent times this has been accelerated by the “living on the edge month to month” method many over-extended folk have found themselves in.
In denial of things getting any worse, they have not placed the property on the market early enough.
When things do take a turn for the downside, some small amount of panic sets in (they “don’t need to sell in a hurry, though”) and they want to speed up the whole “home selling” process.
It’s a double edged sword.
Typically these were the buyers who, when they purchased the property, did so with a 95-100% mortgage from the bank. Today, those 0.25% increases really do make a difference to the monthly cost of living. Now that these sellers are sending out the “desperate / must sell now” signals, they are doing their best to encourage “bottom feeders” who trawl the real estate market in each town looking out for a “steal.” Let me tell you, this is not the way to get a premium for your property.
Look at it another way……..
Example – Mr & Mrs Smith do not have a computer, and one day want to retire to Nelson…..but they “aren’t ready for a retirement home yet”….so while over from Blenheim visiting their relatives in Nelson, they spot a sign outside a property that had spotted & liked “from the street” last trip.
Does the fact that the properties For Sale sign out front have a price figure on it matter to them?
I suggest “No.” But it now gives them on the buyer side some extra ammunition when they sense seller desperation by seeing the price on that sign. I also wonder whether some agents are using it as a last ditch method in the last week or two before their listings hit 90 days.
All I’m asking is, next time you are thinking of placing a $ figure on your For Sale sign, just consider the all the positive / negative ramifications cautiously before you do so.
July 05 2010 09:09 am | Buyers and General and Sellers and The Market
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glen on 05 Jul 2010 at 2:34 pm #
load of nonsense.
all houses for sale with no price just frustrate buyers and make the lsiting agents appear lazy to me.
if you are a serious seller and competent agent then it should not be difficult to come to an agreed asking price.
and agents need to sort out there photos, give floor plans and use less florid marketing.
David Leggott on 05 Jul 2010 at 6:13 pm #
Glen
Think you are confused – I am talking about the sign out front of the property….hammered into the lawn……not the add or the shop window sign or the web listing.
If you are talking about the “lawn sign” would suggest you are weighting your opinions in favour of a buyers way of thinking. Majority of the time we have to ensure we have the sellers interests at heart first off. And I’m sure you’ll have to agree, Buyers don’t always show their hand first up.
If you are an ex-pat, then you’ll be aware of the differences that exist between NZ & UK re the process of listing your home on the market, and the way it is handled thereafter being quite different to the UK way of doing things, so is the speed of transaction. Agree about the photos but very much disagree with your load of nonsense quote.
Ross Brader on 05 Jul 2010 at 6:27 pm #
What difference does it make if the price is on an advert, a web listing or a sign – none!
If the buyer is doing a drive-by or turning up for the open home then they probably saw the advertised price elsewhere. My office has a brochure box on each sign and the price is on the brochure.
If you are putting the price on the sign then you need to be very sure it is accurate or it will have to be changed – now that definitely would not be good for the seller.
I have found if you do put a price on the sign or in bright fluoro letters in the front window of the house that it gets the opposite response to what you would expect – ie buyers think that it must be realistic in order to have put so much emphasis on the price in the first place.
Most of the properties sold by my office sell within $10,000 of the advertised price and I am talking an office average price of around $720,000. So the buyers are not coming in at 5% or 10% below.
If you have appraised well in the first instance then even the buyers will acknowledge that the asking price is realistic compared with all the other homes they have seen through that have sold.
David Leggott on 05 Jul 2010 at 7:18 pm #
In re-reading what I wrote it seems there is grounds for ambiguity to creep in.
What I meant to say was when a property is on the market for say 60 of the now officially sanctioned 90 days, and………then the price pops up on the sign (as has happened 3 times locally in the last week) is that called marketing? Not from a 101 school I don’t think?
Yes I am completely aware that the web listing, the shop window, the brochures, et al have the price on it, but what I was trying to talk about / the point I was trying to get across was by placing the price on the “For Sale” sign (the one on the lawn) the signal sent to the sentinel is a non positive one if a premium price/favourable conditions were hoped for, irregardless of appraised price / web price / whatever. Yes, til the cows come home, we can suggest a “good” agent will do this and that…..but I am saying that by placing that pri$e on the sign in the last stages of a campaign, is not the most positive thing to do from a buyers perception. (reread post if confused on this part)
Its like this is what happens in the “dying throws” of a listing…….so why tell buyers that!
Who are you working for!
Maybe just like Activerain we need a separate switch so that we can post to an internal discussion.
Guess that’s the thing with the net though, no one knows your intentions, and as is quite obvious from this little parlay – there’s plenty of cynics out there….
Steve Taylor on 05 Jul 2010 at 7:28 pm #
I have to agree with Ross and Glen. I have put the price on a sign for a section as it was among lots of other sections for sale. To make it stand out I also put the section size.
I would think it would look tacky when a price was on the ‘For Sale’ sign, but if it was amongst similar properties and I was selling one at a lower price, it would get noticed more than a property for sale at an unknown price. If my price is out in the open it would imply that the ‘unknown’ price of the similar properties must be higher.
I do think that tactics can be very important in real estate.
Ariel Levin on 04 Aug 2010 at 9:41 am #
Use a Flier box like Brader and avoid putting the price on the sign in case you have to change if later – then it will get messy.
You could use a direct response text number on the sign that provides basic information like price etc.