The Lannister's were very excited about learning what they need to do when selling a home - their home.
I arrived 10 minutes early for our meeting. They greeted me warmly and I was very excited to meet them. They were a very nice couple and very welcoming.
After our greetings, I asked if I could put my paperwork at the kitchen table while they give me a tour of the property. The said, “Of course.”
Jaime was very excited to give me a tour. He showed me what they’ve done to the property since they’ve moved in. I asked Jaime if he could write down approximately when they did the improvements, what they did and give me a copy. He said yes. I told him that this list would be a good marketing material for us.
I told him that transparency is going to be our theme when we market their home. The more the buyer knows about their home, the more comfortable they will be when making an offer.
Selling a home should be more transparent. It would make the entire process more enjoyable and less stressful for all parties.
We sat down at the kitchen table after the tour. They offered me a glass of water, which I happily accepted.
“Cersei and Jaime - Thank you so much for having me over tonight.” I started our interview. I then asked them, “Did you get a chance to read the package I emailed you?”
“We did.” Jaime answered.
“Do you have any questions regarding what’s in that package or about me? I asked.
“No. It was very thorough." they both answered. They said, they would really like to get to pricing as soon as possible.
“Good and we'll get to that very soon” I said. “Let’s quickly go over my questionnaire just to review your situation and so we’re all on the same page, okay?”
They agreed and we went over the questionnaire. Then moved on to going over the Comparative Market Analysis (CMA) to determine the value of their home and what would be the best price to set on their home when marketing it.
"Oh, good! Just what we've been looking forward to." Cersei said.
... Let me emphasized how imperative it is that we leave out as much emotion out of pricing your home as possible. I know that selling a home can be emotional and frustrating. A lot of times, sellers aren't as prepared as they think they are, but we need to make a decision on the price based on the facts and other important information that the market is giving us.
Selling a home is only half of the process. There is also the buyer's side and what we're about to do is what any decent buyer's agent would do for their buyer before making an offer.
I understand how easy it is to be emotional about your home - especially if you’ve done many of the upgrades yourselves, ... Watch their children grow up in the home, etc.. There are a lot of memories here. I understand all of that...
... Unfortunately, the potential buyers and the buyer’s lender will only care to not overpay on the home. What the buyers and their lender will do is do what we’re about to go into in detail.
I repeated that sentence again… What the buyers and their lender will be doing BEFORE CLOSING ON THE LOAN, is review, in detail, what we’re about to review and there will be NO EMOTIONS involved…
I continued and asked them to play a little game with me. I asked the to...
Imagine you are a buyer and I’m your agent. We’ve looked at homes and you finally find a couple of homes that you absolute love. You choose one that you want to make an offer on.
The first thing we’ll do is pull comparables on the home and do a CMA.
We have to make an offer that makes sense and stands a good chance of closing without a lot of headache and knowing the value of the home helps us with that.
It's never good to have valuation issue in the middle of the transaction when you've spent your hard-earned money for inspections and for the appraisal (total of over $1,000). Therefore knowing the value of the home by doing a really good CMA will give us a much better chance of a smooth transaction. However ...
If we get our offer accepted and the agreed upon purchase price is higher than the appraised value, then, as the buyer you can then decide to:
So, it is imperative that our offer is at value or a bit over, if you have the cash to come up with the difference.
So, we went over, in detail, the following:
They gave me a couple arguments why their home should be priced higher. I told them I understood why they felt that way, but in order for me to do my best for them and look out for their best interest, I had to stick to my guns. I went back to the facts on paper, which AGAIN, will be the same facts the buyers and their lender will be looking.
I told them that if the lender sees the facts and determines the buyer’s offer price is way too high, then they will deny the loan or only offer a loan amount UP TO that appraised value, because the home is THEIR collateral.
Jaime said jokingly, "I don't like what the market was saying." However, he understood why I was so adamant with sticking to my guns. He knew I was showing them the actual facts and I did not make up the value out of nowhere.
They did try one more time to get me to change my mind, then came down to earth once I went over the facts again. Deep down, they knew the market was correct.
Selling a home involves numbers and you want to know the bottom line. Therefore, while they were discussing the facts, I pulled out the net sheets so we can go over how much they'll walk away with after all is said and done.
I gave them their copy to review along with me. I showed them that based on their timeline, we can price their home accordingly.
Then I told them... My recommendation is to go ahead and price it slightly lower (1% lower than market value), no matter your timeline, and create an auction effect so we can receive multiple offers, which increases our chance of netting a higher amount.
I mentioned again that there is no better marketing of their home than pricing it right. We can spend a million dollars on marketing and drive buyers to look at their home. However, that is all they would do - they'll look, but make no offers.
If someone does make an offer, more often than not, it will be a low-ball offer.
They were in deep thought and I did not want to disturb, so I stayed silent until they said something.
A minute seemed like 10 when everyone is silent, then Jaime asked me if I could lower my commission.
I said, “Sure, if you lower the price.”
They didn’t like my answer. I told them I wasn’t being a smart aleck. I was simply telling them no.
I explained to them how the commission they pay me does not all go to me. My company gets a huge cut, my transaction coordinator gets a cut and other 3rd parties that I use to help me sell their home gets a cut as well.
Then I asked, “Jaime. If your employer asks you to take a pay cut for doing your job, would you take it?”
He shook his head and indicated, “NO.” They both understood where I was coming from.
I said, "I know you want to net as much as possible. By pricing your home properly from the beginning we will can create an auction effect and have buyers fight over your home. This is the best way to make more money from the sale of your home.
They were deep in thought once again and once again I stayed silent and let them discuss and think.
I can see the wheels were turning, then I asked...
When selling a home, pricing it correctly in the beginning is a must! Overpricing a home is never a good idea. Here's what happens when it's overpriced:
I asked them, "Do you know what agents think when a home has been on the market for a long time?"
After 14 days, your house starts to sour in the buyer’s eyes and the agents will start to wonder as well. Showings will drop considerably. The first thing we think of is the property ie ether overpriced or their is an issue with the property's condition.
After 21 days of selling a home and the price has not been dropped, the buyers and agents start to think that the seller will be hard to work with and thus they are hesitant to make an offer.
"You don't want that, do you?" I asked and they both empathically said, "NO."
"Great!" I said. "I'm glad you feel that way." Then I gave them a big heads up.
"Keep in mind once you lower the price, it’s not guaranteed that you’ll get an offer right away. If we have to drop the price, let's not nickel an dime it. Let's have one large price drop and get the buyer’s attention and get excited about the property.
Cersei spoke and said, “Okay, let’s do it! What’s next?”