💡 The 80/20 Truth About Pricing That Changes Everything

Every Realtor knows the two biggest headaches in today's market:

1. buyers who won't pull the trigger and
2. sellers who aren't realistic when pricing their property

Last week, we tackled the buyer problem.

This week, let's talk about the elephant in every listing appointment: sellers who overprice their property.

This certainly isn't a new challenge in the world of real estate, but it's more prevalent than ever.

In fact, 60% of the listings in the MLS have been for sale for more than 60 days here in Northeast Florida. The market has rejected their price and we know that they are priced too high.

Why are sellers listing too high? 💸

Part of the problem is sellers are low on motivation.

Most have an interest rate under 4% or no mortgage at all. This makes it feel inexpensive to keep the property compared to the price/rate they'll pay on a new home.

Also, they've gotten the idea that their home is worth a certain amount (that's too high). 

It just takes a few updates around the house, a Zestimate, and the idea that they could profit a certain amount to inflate the value 20% over market.

And, on top of all that, most agents are operating in scarcity mode as business has gotten tougher.

They let the seller overprice - fearful of losing the listing if they say otherwise.

Too many agents are unable to navigate the pricing conversation effectively and play the price reduction game.

And listen... I get it. Back when I was a mortgage banker, I did the same thing with rates.

Clients would call and ask me for my best rate. I'd jump straight into pricing, they'd thank me, hang up, and I'd never hear from them again.

Then I learned something that changed everything: I was having the wrong conversation.

A similar thing is happening with your pricing talks and it's killing your business.

How to Effectively Price Listings 🎯

It just so happens that this topic was the focus of our Market Insiders October coaching session. 

I walked through 6 pricing truths and how to give pricing recommendations that help sellers see reality, price appropriately, and get homes sold.

While I can't share everything we discussed in the coaching session, I can help with 3 pro tips that will help you get started pricing listings more effectively with your sellers:

1. ⚖️ Recognize that price is the 20% that determines 80% of the listing's success. 

When you price a listing above the market, the pressure to market your way to sold sets in. You spend money on staging, hold broker opens, boost social media, and spend your weekends at open houses - all with no success. 

You can't market your way out of a bad price.

Instead of wearing yourself out doing everything except selling the property, understand that listing the home in the market is the 20% of the process that does 80% of the work selling the home.

2. 🤝 Build Understanding Before Discussing Numbers. 

It's common for price to come up early in the conversation at a listing appointment. This is a big mistake. 

When you jump into price too early, you're going to be fighting an uphill battle to overcome a high price from the beginning.

Instead, set the stage properly by helping the seller understand the current market conditions prior to having a price discussion.

3. 👀 Make Your CMA Forward-Looking. 

A big challenge with pricing a property is that even when the seller goes with your price, you can still get it wrong. 

You see, appraisals and CMAs are backwards-looking. They see what sold in the recent past and apply that pricing to today.

But the market of the past isn't the market of tomorrow. You've got to account for where the market is going when doing your pricing to make sure you don't miss the mark.

The Conversation That Changes Your Career 🚀

Master the pricing conversation and everything changes.

No more chasing price reductions. No more explaining why there haven't been showings. No more wasting thousands of dollars listing homes that won't sell.

Sounds nice, right?

The difference isn't your marketing budget or staging expertise. It's your ability to have one conversation – the right conversation – about price.

Stop treating price like something to negotiate with the seller. Start treating it like what it is: the single most important decision in the entire listing process that you are the expert on.

The market rewards agents who price properly and punishes those who don't.

Which side of that equation do you want to be on?

Dr. Alex Stewart
Founder