Evaluating and responding to different offers.

Congratulations - you have received an offer on your home! So how can you evaluate and respond to the offer in a way that protects your interests but doesn't send buyers running for the hills?

The first thing to remember is that all offers are good. Why? Because it shows that a buyer has chosen your home over the massive amount of competition available in the marketplace. Any offer then, regardless of how high, low, or crazy it might be, should be taken as a compliment. Now the harder question - Should you accept the offer?

As a seller, when you receive an offer you always have three choices. First, you can accept the offer - this means subject to the conditions of the sale your home is officially sold. Second, you can reject the offer, and in effect tell the buyer to kindly kiss off. Or third, you can counter the offer. While many sellers instinctively reach for a pen to counter all offers, wise sellers take a deep breath before making this decision.

Many sellers view making a counter offer as a natural part of the sales process, but what many don't realize is that they are really rejecting the buyer's offer first and then presenting a new offer back to the buyer. The trouble with this is, the instant you give the buyer a moment to pause and reconsider their decision, even for a minor point, you run the risk of losing the buyer. Because of this the question that successful sellers have learned to ask themselves first is: Is it really worth a counter offer? This simple question should be the measuring stick with which to evaluate every item you plan to ask for from a buyer. In many cases the risk is not worth the reward.

If you are forced to make a counter offer keep in mind these three tips:

1) Attempt to understand the buyer's position
A negotiation is never a one way street. In order to create a sale, both parties must feel they are receiving a good value. Learn as much about the buyer, including their background and reasons for making their initial offer, as possible. By doing so you may able to find common ground that can create a successful sale.

2) Use the give and take technique
When making a counter offer, think in terms of, not only what you want, but what you might be willing to give up to make the sale happen. For instance, if you are asking for a higher price, can you help pay the buyer's closing costs or perhaps pay points to help them secure lower payments?

3) Emphasize the positives
In writing your counter offer you may want to emphasize the areas that you do agree on before you begin asking for modifications. For instance, point out all the areas of the original offer that are acceptable. This might include the closing date, the possession date, the down payment, the price, the inclusions and exclusions, the financing type, specific conditions or contingencies, or even something as simple as the size of the earnest money deposit.

By taking the time to evaluate each offer and establish a negotiating strategy, based on an unemotional analysis of the market and your needs as a seller, you will be far ahead of your competition.

www.TheCascadeTeam.com

Price vs time: Measuring your motivation

Pick a price, any price for your home. Now wait. Eventually, someday, someone will probably be willing to pay you that price. The question is - Do you have the time or the desire to wait for that to happen or would you rather sell your home now for a reduced amount of money? Welcome to the Price VS Time dilemma that faces all homeowners.

The Price VS Time dilemma is the challenge of determining which is more important to you as a homeowner - selling quickly or selling for top dollar. Of course, it's easy to bang the kitchen table with both fists and say I want both, but that's unrealistic. In the real world every homeowner falls into one of two categories: the necessary seller or the optional seller. Let's define these two vastly different types of sellers:

The Necessary Seller: Necessary sellers are homeowners who must sell their home and it's not something they can avoid or put off. Perhaps they have a job transfer or job loss, a pending divorce, health condition, or a financial crisis that is causing them to sell. Regardless of the reason, they need to sell, and the faster the better.

The Optional Seller: Optional sellers are homeowners who have made the choice to sell. They aren't forced to move, they simply would like to make a housing change. Perhaps they want to upgrade to a newer home, a larger property, or just as likely, maybe they are selling to travel or move closer to friends and family. The bottom line is it will be inconvenient if they don't sell, but the world won't end.

So which kind of seller are you - a necessary seller or an optional seller? The answer to this question is key to determining how you resolve the Price VS Time dilemma, but be careful as it's not as easy it might sound. For instance there are tens of thousands of necessary sellers across the nation who desperately need to sell their homes quickly, yet they act as if they are optional sellers. These sellers list their homes for inflated prices and then are shocked, frustrated, or even angry that their homes fail to sell within their pre-set timeframe. Another wrinkle facing both optional and necessary sellers today is the issue of rapidly declining prices in many areas of the country. While in a typical real estate market an optional seller might hold out for top dollar, this strategy can easily backfire in today's market as their home may be worth significantly less the longer they hold out for a higher price. In addition while many optional sellers may not be forced to sell, they may want to sell quickly because of other motivating factors. If this is the case they will need to adjust their pricing strategy accordingly.

If you are having a challenge determining just where you fall on the motivation scale ask yourself this follow up question. If I listed my home for 90 days and it did not sell, what would be my next step - adjust the price or give it a little more time? If your answer is to adjust the price, this would seem to indicate that selling quickly is more important for you. On the other hand if you feel more inclined to give it a little more time, top dollar is more than likely your primary motivator.

To unravel the Price VS Time mystery further sit down with a Cascade Team Agent and give them an honest assessment of the reasons why you are selling. By reviewing what homes similar to yours have sold for in recent months and the time frame it took those sellers to sell, it should help you to set a pricing strategy that meets all of your needs.

When should you drop the price?

It's a tough call. Naturally you want to do everything in your power to avoid giving up any hard won equity in your home, so adjusting the price is always a last resort. The question is - What's the best timing? How long do you wait from the time your home hits the market until you pull the plug - a week, a month, ten days? To answer this question we have to explore how buyers come into contact with your home's price and then ultimately how they measure it against other similar homes.

Something magical happens the first day you list your home for sale. Like the new kid at the high school dance, all eyes will be upon your listing. At that moment buyers and agents make some rapid judgments. Is the home overpriced? Is the home in good condition based on the photos? Is the home in a good location? This first impression will shape how many showings you receive during the first few weeks the home is listed. If you receive very few showings, or no showings, during the first two to three weeks after the listing has hit the market, you have a problem. The market as a whole is rejecting your value proposition. There is only one solution: adjust the price, and the faster the better.

Why not give it more than just a few short weeks? Think of the real estate market as an audience in a movie theater. As soon as your home hits the big screen the group collectively decides if they like the picture or not. More time won't change their mind. If your home has seen little or no activity, it's been decided that your home got a thumbs down. The only thing you can hope for now is that new audience members will trickle in, new buyers entering the market, who will, against all odds, fall in love with your home and nominate it for an Oscar. A better bet is to edit your price and re-submit it to the academy.

There are also other times when a pricing adjustment may need to be considered. For instance, let's take a look at Joe and Jane Seller's listing price below.

Competitor Home A: $368,000
Competitor Home B: $349,000
Joe and Jane Seller: $345,000
Competitor Home C: $345,000
Competitor Home D: $333,000
Competitor Home E: $329,000

Joe and Jane appear to be very competitively priced relative to the market. But let's see what happens 30 days later:

Competitor Home A: Expired
Joe and Jane Seller: $345,000
Competitor Home B: $339,000 (Reduced Price)
Competitor Home C: $335,000 (Reduced Price)
Competitor Home D: Sold
Competitor Home E: Pending
Competitor Home F: $326,000 (New Listing)
Competitor Home G: $325,000 (New Listing)
Competitor Home H: $319,000 (New Listing)

Joe and Jane went from being very competitively priced to being the highest property in their price range. From a buyer's perspective, their home now offers the worst value proposition in the marketplace. The interesting part of this scenario is that most sellers like Joe and Jane would never know the market winds had shifted so far and so fast. Why? Most sellers only request a market analysis at the beginning of their relationship with a real estate professional. Instead, homeowners need to stay abreast of all market activity in real time. How? One simple way is to use the internet. For instance at The Cascade Team you can receive automatic updates on prices changes and new listings as they hit the market, or check out the latest Market Analysis for Stats & Trends. This is critical information that can be invaluable to creating a competitive pricing strategy.

10 Questions to ask your next listing agent

So you have decided to hire a listing agent to assist you in marketing your home. But who should you hire - your brother-in-law, your neighbor two doors down, or the lady who sends you a calendar in the mail every December?

Amazingly, according to the latest National Association of REALTORS® Profile of Home Buyers and Sellers, 67% of sellers interview only one agent before making the decision to list with an agent. But is that wise? No, probably not. Instead successful sellers often find it prudent to meet with multiple agents and treat each appointment as a job interview.

So what questions should you ask each interviewee? Let's take a look at 10 questions to ask your next listing agent:

1) How long have your been selling real estate and are you a full time agent?

Agents who have been in the real estate business for more than five years are likely to have double or even triple the income of newer licensees, but don't pull the trigger too quickly. Many new licensees represent the new breed of college educated, internet enabled, smart phone packing entrepreneurs who may be just the kind of aggressive agent you've been looking for in this challenging market.

2) How much real estate did you sell last year?

Past performance can often be an indicator of future results. It may be harsh but agents who are having a hard time selling homes may also be suffering through a cash crunch which can affect their ability to invest marketing dollars into promoting your listing. Although a word of caution - don't be too surprised if you find that even the top producers in your marketplace have had a tough last twelve months.

3) How many homes have you sold in my area?

A great way to find a listing agent is to identify agents who have sold homes in the last six to twelve months in your specific neighborhood. Agents that are consistently selling homes in your market area will have a better handle on how and why buyers prefer living in your community. The ability to market these positives can be a huge plus when trying to locate a buyer for your home.

4) What is your average market time vs. the market?

The average market time is a measurement of how long it takes the average home to sell - from the time it lands on the local multiple listing service to the day it closes escrow. Strong listing agents can often outperform the overall market by using innovate and aggressive marketing techniques that can help a home sell faster and for more money.

5) What is your list price to sales price ratio vs. the market?

If homes in your market area are selling for an average of 96% of their asking price, in real estate lingo this is often referred to as the list price to sales price ratio. Ideally strong listing agents will be able to "beat the street" by helping sellers price homes closer to real market value.

6) May I see a portfolio of other listings you have sold?

If you were going to hire a doctor to perform heart surgery you probably wouldn't hire a dentist, right? The same is true in real estate. Ideally you want to hire an agent who specializes in your specific type of home - waterfront homes, golf course properties, and condos for instance. These agents will be better equipped to provide specialized services that will give you better odds at creating success.

7) Do you provide a written report to sellers, and if so, how often?

Communication is vital in a constantly changing real estate market. An agent that provides updates, even automated updates, on marketing, website activity, buyer showings, or even the sound of crickets (if nothing is happening) is a huge asset. Be clear and up front about your expectations and, if possible, set aside a day of the week to check in with the agent.


8) May I see your resume or personal brochure?

Asking for a resume is a great way to learn in-depth information about your potential new partner in the sale of your home. It can also reveal details you might never have known - like their job history, educational background, and list of references. Don't be afraid to dig deeper by asking for permission to call previous clients for a testimonial.

9) Do you have a specific marketing plan in mind?

Aggressive agents have aggressive marketing plans that ensure that their listings are exposed to every potential buyer in the marketplace. By coming to a meeting of the minds about what the specific marketing plan will be for your home at the outset of the listing agreement, you will set the stage for a successful relationship.

10) Do you have internet strategy and how will you market my home online?

The vast majority of buyers today use the internet as an information resource when searching for their next home. Because of this you want an agent who has embraced an internet strategy as an integral part of their marketing plan. Ask to see their personal website, samples of virtual tours, web pages, and a list of portals where your home will be marketed.

Don't be too surprised if some agents aren't quite ready to answer all the questions you have prepared for them. To be fair you may wish to provide them a list of your specific questions in advance so they can come to the listing appointment ready to impress you. Also, to make the most unbiased choice, ask agents to leave their pricing suggestions at the door. This will eliminate the natural but incorrect tendency of hiring the person who tells you the highest price and focus the interview solely on each agent's individual strengths and weaknesses.

You can get details on The Cascade Team Marketing Program by clicking HERE.

The seven deadly sins of overpricing

"We can always go down, but we can't go up."

If you're selling your home this statement has probably crossed your lips at least once. But when it comes to setting a pricing strategy for your home, is it a good idea to start high and work your way down, especially in a market flooded with inventory? Probably not, as most experts would advise that the best way to increase your odds of a successful sale is to price your home at fair market value. But, as logical as this advice sounds, for many sellers it is still tempting to tack a few percentage points onto the price to "leave room to negotiate". To avoid this temptation, let's take a look at the seven deadly sins of overpricing:

Appraisal problems
Even if you do find a buyer willing to pay an inflated price, the fact is over 90% of buyers use some kind of financing to pay for their home purchase. If your home won't appraise for the purchase price the sale will likely fail.

No showings
Today's sophisticated home buyers are well educated about the real estate market. If your home is overpriced they won't bother looking at it, let alone make you an offer.

Branding problems
When a new listing hits the market, every agent quickly checks the property out to see if it's a good fit for their clients. If your home is branded as "overpriced", reigniting interest may take drastic measures.

Selling the competition
Overpricing helps your competition. How? You make their lower prices seem like bargains. Nothing is worse than watching your neighbors put up a sold sign.

Stagnation
The longer your home sits on the market, the more likely it is to become stigmatized or stale. Have you ever seen a property that seems to be perpetually for sale? Do you ever wonder - What's wrong with that house?

Tougher negotiations
Buyers who do view your home may negotiate harder because the home has been on the market for a longer period of time and because it is overpriced compared to the competition.

Lost opportunities
You will lose a percentage of buyers who are outside of your price point. These are buyers who are looking in the price range that the home will eventually sell for but don't see the home because the price is above their pre-set budget.

One popular myth is that a great marketing plan will overcome a pricing problem. Nope - spending a zillion dollars on advertising, internet ads, and television spots won't motivate buyers to pay you more than the home is worth. Another myth is the assumption that a buyer will see your home, fall in love, and write you a check so the competition doesn't matter. Wrong. Buyers don't look at homes in isolation. Most look at 10-15 homes before making a buying decision. Because of this, setting a competitive price relative to the competition is an essential component to a successful marketing strategy.

For detailed market information visit www.TheCascadeTeam.com

Full Service Real Estate for 1% Listing Fees!

What Do We Offer Our Sellers?

In short, full service listing representation for a 1% listing fee. Let us help you save thousands selling your current home, but more importantly, ensure that it is marketed the way it should be. We provide a full complement of internet and print marketing, which hits both consumers and agents to get your home the exposure it needs in this competitive marketplace. Above is a list of the services that our clients receive when listing their home.

You Still Pay the Buyer's Agent

Aside from the 1% commission you pay to list your home, we always recommend that you pay the buyer's agent the traditional MLS commission of 3%. This ensures traditional real estate agents will show your home in the current market environment, as you don’t want to give a reason to not show your home. The total home sale commission is only 4%, instead of 6%, allowing you to keep 2% of your property's selling price in your pocket.

Are you a little more aggressive? With a 2% savings, it gives you the flexibility to price your home more aggressively to get is sold quicker. For more information click here: Seller Info: