Feedback. The word itself can strike terror into the heart of even the most seasoned Real Estate Agent because the reaction from a home seller, when the information is delivered, can vary wildly, as emotions can run high. Yet it is the most vital component of any residential property marketing strategy in assisting a home seller to make the best informed decisions.
Feedback is where the agent relays to the seller what the buyers have had to say about the property. It is critical to inform the seller how the market is reacting to the property.
It is this supply (or lack) of market information that generally leads to the biggest break-down IN THE SELLER/AGENT RELATIONSHIP.
Not enough and the seller feels unloved and under-serviced.
Too much without a result and after a while the seller can feel like they are not getting the true story.
Agents walk a tightrope when it comes to feedback. Unfortunately, some feedback is usually bad news for the seller, so many agents tend to fluff and flower up what buyers have had to say, to protect the seller, and in the end the seller builds up a false impression of what buyers actually think.
Quite a sizeable proportion of my listings come from sellers who have fallen out of love with their agent and they are looking for the ‘magic potion’ from another.
When I am talking to a seller in this situation, I ask a very simple, yet revealing question that tells me how the previous agent delivered buyer (market) feedback; “What did the buyers have to say about your property?”
Nine times out of ten, the seller answers, “Oh, the buyers really liked it, one lady in particular loved it.”
You know what my next question is………, “Why then do you think it hasn’t sold?”
The answers I get to this question range from, “Oh the agent didn’t tell the buyers about our big pink lattice with the choko vine growing over it,” to “He didn’t tell us what was happening?”
It all boils down to one fact. The answer should be - The agent failed to ask THE most important question of any and all buyers who inspected the property, “What do you believe this home is worth?” THEN relaying the feedback in simple terms, “This buyer has seen X homes, has an interest/does not have an interest in your home and believes it will sell around $x.”
Now this is where the men stand out from the boys. The many agents I have known and know of:
1. Fail to ask the value/price question of the buyers
2. Are too shit scared to tell the sellers the buyer’s opinion of value/price even if they did ask the buyer.
Some agents are not serious about finding out what the market REALLY thinks a seller’s home is worth. AND sellers can turn into evil fire breathing monsters if they are informed that the buyer (or buyers) thought it was worth less (or much less) than the price the seller was hoping for.
Agents are scared of being yelled at, burned, hit or sacked if they tell the truth. Herein lies the reason why so many homes fail to sell. Scared agents are unwilling to impart the market truth upon their emotional sellers.
More than ever before in the history of real estate sales, buyers know what properties are worth and are willing to pay reasonable market value. Some sellers, unfortunately, still cling to a false hope price either derived by emotional research, or by an agent who inflated the list price to win the business.
In my vast experience, and almost without exception, the feedback from buyers on a home’s true value is bang on. Buyers are individuals but collectively act as a single beast.
Here is one example out of hundreds of properties I have marketed.
A young couple approached me to sell their almost new home in a very nice estate. Pre-market research showed that the home was likely to fetch somewhere around $470-$480 thousand. The sellers were adamant it was worth $500 thousand. We agreed to take the home to auction.
In four weeks, in a falling market, with buyers becoming scarce, we had over twenty inspections and the feedback on value came in at $472,000 (averaged out from the buyer opinions). Based on that direct information from the market, the vendors placed a reserve of $490,000 on the home, but there were no bids at auction. Nothing lost there – within a week I had received an offer on the property for $460,000, and I knew the buyer had more money to throw in.
When presented with the offer, the seller rejected the offer and would not negotiate, despite informing them that I believed the buyer had ‘more in them’. The sellers took the home off the market and sold it 12 months later for $445,000.
The feedback was delivered directly from the mouths of the buyers, and was deadly accurate. In this case the sellers ignored the feedback to their own detriment. Fortunately, there are other sellers who listen, and those who do, sell their homes quicker and for better prices. If a home is priced correctly, feedback will generally come in the form of an early offer.
Accurate feedback to sellers is based around one very simple question to be asked of buyers, “What is it worth, today?”
So my message is this: Sellers – demand that the feedback from your agent is based almost entirely around value. What is the market willing to pay?
Agents – Ask the buyers their opinion on price and relay that to the sellers without any fluff, no matter how much you fear for you well being. You are doing your clients a massive favour and allowing them to make informed decisions.
