How to Sell a Listing for an Extra 5.5%!

I made my sellers an extra 5.5% on their sales price!

Several other agents had told my clients that they couldn’t sell their home for more than $500,000!  I thought we could!  My CMA (Competitive Market Analysis) indicated that we could sell for somewhere between $500,000 & $540,000, so we listed it at $539,000 and went to work.

My team prepared our standard Big WoW Marketing Package (www.6243Rohnerville.com) and put the home on the market.  Within 2 weeks we had four showings and 2 offers. 

The first offer, from buyers in Portland & Santa Cruz, came in below $500,000.  When I presented the offer to my sellers, they wanted to know everything they could about the buyers’ interest level, and when I showed them our custom website hits by city, with Santa Cruz and Portland at #1 & #2, they realized that our buyers were very interested in their property.  We knew we had a 2^nd offer coming, so we prepared a counter offer at $535,000 and waited. 

When our 2^nd offer came in the next day under $500,000 as well, we decided to continue with our counter offer to buyer #1, and let them know that we had received a 2^nd offer.  When our first buyers heard that there was another offer on the table, they couldn’t sign our counter offer fast enough!  We opened escrow, and after our inspection period and some negotiations for repairs, we closed escrow at $527,500!

After the initial photos and the placing of a home in the MLS, most agents rely on the price reduction as their main tool to sell a home.  Hence, most agents thought this particular home would sell for under $500,000.  By engaging the buyers’ hearts and minds with our Big WoW Marketing Package, we were able to coax an additional $27,500 out of their pocket!  That’s an additional 5.5% of the expected value of the home!

So if you truly want top dollar when you sell your home, Big Wow Marketing is the ticket!  Obviously, I can’t guarantee you a specific sales price, but I can guarantee you the best marketing available in the real estate industry today!  And it won’t cost you a penny extra!

I Made My Sellers an Extra 6.7%!

I made my sellers an extra 6.7% on their sales price!

My client had been listed before at $1M with a different agent. He was shocked when I told him his property was worth $750,000. He really wanted to sell, and he loved my Big WoW Marketing package, with it's custom website, but he said he couldn’t go below $850,000. I told him I would market his property at $849,000, and we’d give it our best shot. If it didn’t sell, at least he knew that he was getting the best marketing possible, and we could either reduce the price or try again at a later date.

After 9 months at $849,000, the perfect buyers appeared from Los Angeles. They commented on each of their visits to the property how beautiful the website (www.15500DyervilleLoop.com) looked and how it showed off the property. So when they brought a cash offer at $700,000, we knew they were really interested.



I presented the offer, and my Seller decided to counter at $800,000. The buyers countered us at $750,000. I told my Seller that this was probably the best deal we would be able to get, and that I couldn’t even guarantee that it would appraise for more than this, should the next buyer need a loan of some kind. $800,000 was as low as he would go, though. I made the best case I could to the Buyers’ agent, and hoped for the best.



In the meantime, the website traffic for the home took off! Our weekly average went up over 300%. I can just imagine the Buyers asking themselves, “$800,000! Is this place worth it? What do they see in it? Let’s go look at that web site one more time!” And every time they did, the views and selling features wormed their way into the buyers’ hearts and minds.



Bottom line - they accepted our $800,000 counter offer and we closed escrow. My Big WoW Marketing made my Seller an extra $50,000, or 6.7%, in his pocket. And it didn’t cost him a penny extra!

If the only tool you have is a hammer, you tend to treat everything like a nail. If the only tool a Realtor has is a price reduction, the property seller is the one who gets beat on. Custom websites - with a 3-D custom floor plan, Virtual Tours with Hotlinks, and the unlimited ability to show off a property to a buyer- are changing the way we market properties. Embrace them, and put more money in your sellers' pockets. They will return the favor!

Do Custom Websites for Listings Work?

My sellers had already moved to Arizona when they called me in response to an expired listing letter. They had their home listed with another agent, it didn’t sell, and they weren’t happy with the agent’s efforts to sell their home. I explained my Big WoW Marketing package to them (see a sample at http://www.2972oldarcataroad.com/) and they listed their house with me, albeit at more than I told them it was worth. I suggested $325,000; they wanted to list it at $359,000.

A potential buyer called me soon thereafter. He was visiting from out of the area, and he had seen my directional sign on the main road, and had followed it to the property, where he pulled a flyer out of the flyer box. Intrigued by the photos and 3D floor plan, he called me to see the inside of the home. I called my assistant in that area, and she immediately met the buyer and his family and showed the home to them. They went home, and the next week called me to write up an offer.

They offered what I described to my sellers as “top dollar,” $335,000, and we put it in escrow. During our inspection period, the buyer found several key issues of which the sellers were not aware, including

• A failed septic tank.
• Significant pest issues.
• A failing roof.

Had we simply deducted the cost of these repairs from the purchase price, we would have been well below $300,000. Instead we re-entered the negotiating process. The buyer really wanted the property, and the seller was adamant about getting what they considered a fair price. Through much dialogue, we were able to arrive at a purchase price of $317,500, a price that was acceptable to both the buyer and the seller.

Toward the end of the escrow, I emailed my buyer regarding some final details, and asked if the Big WoW Marketing package we produced had helped him through the process. This is what he said:

Jeff,

… In regards to your website, it was very helpful and was instrumental in us making this decision. Its human nature to question a large purchase as time goes by and you can’t see what your contemplating buying…the fact that I could daily go to the site, share pictures with friends and keep the excitement going was probably the main reason we went through with the deal. I doubt we would have done the deal without the site.

Thanks again for all your help….look forward to meeting you at some point in the future.

John

Had we lost that buyer, we would have had to sell for under $300,000; instead we were able to sell for $315,500. That’s in increase of over 5%! The fact that Big WoW marketing engaged the buyer’s heart and mind on a daily basis from 250 miles away meant an extra $15,500 in the sellers’ pockets.

There's no question that custom websites for listings take more up-front effort and investment on my part. But not only does the increased sales price mean a bigger pay check for me and my sellers, the increased client satisfaction means more listings and more paychecks than I could accomplish without offering this Big Wow Marketing package.

Humboldt County, California Real Estate Statistics, July 2011

How is our local real estate market in Humboldt County, California performing, in the midst of all of the gloomy national and world economic news? Kinda yucky.


Our housing inventory, the number of homes for sale on the market, has been creeping up all year. We're not high beyond normal, but we are high enough that we might start seeing some downward pressure on prices.

The more homes we have that are selling, the better support we will have for prices. While we are up off of some of the scary bottom figures we've seen earlier in the year, we are not selling so many homes that it looks like prices are going to start moving up again any time soon.

And sure enough, our average sales price continues our ooze downward. Our average sales price has been lower than the year before for 5 of the last 7 months, and 25 of the last 31 months. But don't panic. This too will pass. We won't know it's the bottom of the market until we've already passed it.

The median price has graphed similarly to the average price.

There is no little man that comes out and rings a bell on the day that the market hits bottom. It could be next month, or today, or last week. We have a great selection of homes, the best interest rates in years, and you gotta live somewhere. And rents are very strong relative to price. We will look back some day, and say, "I sure do wish I had bought real estate in Humboldt County in ___," and there will be a date in that blank. We just don't know if it's today's date, or tomorrow's!

Good Video, Bad Video, for Luxury Homes

The marketplace is changing, and no place faster than real estate. One of the hot new developments in the marketing arena is the use of video. All of the guru’s are saying that we as Realtors must use video to show off our listings. Is this a good, necessary thing? If it’s done correctly, yes!


Many agents are using smart phone technology to do a video “walk through” of their listings. Beware. These are often of a poor technical quality and not well thought through. I’ve actually experienced the beginnings of motion sickness after watching some of them, and others don’t really give a good overview of the selling features or the feel of the home.

Other agents are using photo viewers to give the appearance of video, utilizing the basic still photos they’ve already taken of the home. This serves the purpose of “using video,” but little else. On several occasions I’ve noticed people standing, frozen, in the “video.” This is no better, and perhaps worse, than some good, quality photos.

Video shouldn’t take the place of good photos or virtual tours, but should show off an aspect of the home that can’t be captured through these other media. Video is great at showing movement and character and interaction. That’s why I employ a professional videographer experienced in the medium. He can capture the features and ambiance of the home in a way that best shows it off to prospective buyers.


Sometimes he will interview the owner or builder of the home, using their vast knowledge of the property in a tour through the home. (See the video link at www.6243Rohnerville.com for an example.) This enables us to communicate a historical or personal angle easy to miss through traditional media. It also allows the seller or builder to highlight features that only he knows about.

Other times my videographer will video the actions of the home itself. A fire burning in the fireplace; a creek rippling across the land; wildlife admiring the view; raindrops falling on a pond; trees swaying in the breeze; waves crashing on a beach. All very provocative images that help imbed your home in the hearts and minds of potential buyers. You can see a great example by pressing the video link at www.290Barley.com .

Other times he will create a webisode, a program featuring characters and a plot line, with the house as the star. This shows people interacting with and enjoying the home in a way that potential buyers can relate to. A luxury home is just as much about a luxury lifestyle as the home itself.

Using video, especially bad video, won't help to sell a home. Good video, done right, will hook that buyer's heart and mind, giving my listing that little edge over the competition.

How Do I Rent-To-Own?

Lots of times potential buyers ask me about a rent-to-own home purchase.  In California, rent-to-own purchases are most commonly done as a "lease-option," where the buyer makes an offer to lease the property over a defined period, with the option to buy it in the future at a pre-agreed price and set of terms.

 

The first stage is to offer terms of a lease. Often a buyer might offer to lease a $300,000 property for a year at $1500/month, with $200 of that being applied toward the purchase price, should the buyer exercise his option to buy the property at the end of the year. Other lease terms regarding insurance and damages and such would be included in the terms.

 

 

 

Then, along with the lease offer, an option to purchase is offered. The option might be exercised in a time frame of 30 days before the lease expires, although any time frame is negotiable. The offer sets an agreed price of, say $300,000. And the offer includes "option money," a fee that should motivate the seller to agree to the whole process, say $5,000. Additionally, the other terms of a sale such as paying for title and escrow fees, inspection periods, and such are agreed upon in the option agreement.

So, in this example, the Seller get's a $5,000 fee up front in cash that he gets to keep, whether or not the option is exercised by the buyer. The Buyer gets to live in the home for $1500/mo, $200 of which will come off the purchase price when he buys. And when the year is up, he gets to buy at a prearranged price...if he still wants it. If the market tanks, he can walk away, and the seller can put it back on the market.

 

Of course, all of these terms are negotiable, but this illustrates the basic framework of a lease-option purchase.  Very few lease-options ever come to close, but for some buyers they can provide a creative way to get into a property that otherwise wouldn't be available.

Humboldt County, California December Real Estate Statistics

I’m a little late getting these stats our, but the real estate market in Humboldt County, California is hanging in there during the month of December!

At the beginning of 2011, there were 550 homes on the market, which is right in our “normal” 500- 550! Fewer homes on the market, of course, supports prices and keeps them from falling. That’s good.

And we had an uncharacteristically high 75 homes sold in December in Humboldt County! That’s the highest count since September, and during what is historically one of our lowest months!. Of course, more homes sold puts upward pressure on prices.

The average sales price of a home came down from November, but remember, that was a very uncharacteristic month. There were 6 homes sold in November for over $500,000, one for $2.2 million! So while December’s average home sales price was down from the previous month, it was a solid $270,993, pretty close to the average for the year of $278,000!

The median home sale price in Humboldt County for December was a little scary, though, down to $235,100, a recent record low! We’re still 3 for 4 so far in the statistical categories!

Are we turning the corner? Have we bottomed out and started looking up? So far in January ’11, things continue to look solid. Over the last 30 days we have sold 78 homes for an average sales price of $261,499, and a median sales price of $243,450. Our lead indicator is volume; as it moves up, prices will follow. So, are we turning a corner? Just asking that question honestly is a good sign!