It’s often said that no one wants to see or know how the sausage gets made. With actual sausage, there is certainly some truth to that, but we’re not talking sausage today; we’re talking Western North Carolina real estate. Over the past few months, the blog has focused on the ingredients that go into making a successful listing, and this blog focuses on the final ingredient in LandCrazy’s less-than-secret recipe: Correctly pricing a property.
We’ve already touched on four of the ingredients in previous posts, and they include strong ad copy, stunning photography, prime staging, and widespread digital marketing. If these four are like the main spices in a good sausage, pricing is a bit more like salt—when it’s done right, you don’t really notice it all. If you get it wrong, however, your sausage will never taste right.
Pricing: An Introduction
On the surface, pricing is about as straightforward as you get in the world of real estate. At the end of the day, the market will determine how much property goes for, but setting the price right helps to entice buyers and give them an idea of what kind of offer to make. If you set it too low, the seller may not get the full value of the property. If you set the price too high, the seller may refuse offers that are below asking because they’ve convinced themselves that it’s worth more than it really is.
Occasionally this can work out. In a very hot market, you may get lucky and find a buyer or someone might make an offer that is below asking but still considered reasonable to the seller. However, Tom has seen pieces of land stay on the market for decades because their price is in the stratosphere.
This is an example of a very salty sausage.
When it’s clear that a property has sat on the market for too many years, buyers tend to assume it’s because there’s something seriously wrong with it, and the property gets branded with a stigma. Without reconsidering the pricing, the chances of selling it then go from slim to none.
Third Person Narrative
Tom says that there’s a saying that in life you want to be the firstborn, the second spouse, and the third real estate agent. These are the people who always get everything. The reason the third real estate agent brokers so many deals is because they get the chance to learn from their predecessor’s mistakes. This is particularly true with pricing.
Pricing is a delicate matter. Sellers obviously want the best price for their property, and inexperienced brokers may be too willing to indulge the seller just to get the listing. Tom says that brokers who are still a little wet behind the ears will first ask, “What price do you want?” They’ll then provide no pushback and put it on the market at that price. If it’s too high, you once again end up with a very salty sausage.
Tom says that his 17 years of experience have taught him to only ask this question after looking at the data. In some cases, he can split the difference. In other cases, the conversation can get a little more difficult. “I tell the sellers what they need to hear, not what they want to hear,” he says.
A Fine Balance
Tom says he always approaches pricing with a great deal of empathy for the sellers. In most cases, the property is the family’s largest asset, and they want to be sure they get the best price for it. Particularly when they are selling because of a family emergency or debt, this can influence the price to make sure the property sells quicker but still at the best possible price. When there is no rush, there can be a bit more wiggle room with the price. The goal is always to find the right balance for not only the property but also the sellers.
The LandCrazy Experience
With almost two decades of experience working in Western North Carolina property, Tom has realized that balancing the needs of the seller with the realities of the market can make for difficult conversations. However, this is how the sausage gets made, and it’s a major part of our recipe for success.