You know there’s a serious slowdown taking place in the residential real estate markets when real estate agents themselves are looking for help. I received this email last week, which has been edited for clarity:
“I am a Realtor located in Haddonfield, NJ. I am wondering what is your opinion on a seller offering a selling bonus to the selling agent? Is this a good marketing idea to generate more showings?”
The problem with market slowdowns is that the U.S. hasn’t had one in more than a decade. In fact, you’d have to go back to the early 1990s to find the last extended period of time when homes weren’t selling well in some locations.
Since then, nearly every major metropolitan area has experienced if not a strong sellers market (when the number of buyers outpaces the number of homes for sale), then at least an active market where homes appreciate anywhere from 5 to 41 percent in value each year and rarely stay for sale for longer than 2 to 3 months.
My how things have changed – and sellers are suffering. Real estate agents and brokers seem out of practice in dealing with buyers markets (when there are more homes for sale than buyers to purchase them). Of course, it’s not their fault. Many of today’s real estate agents and brokers weren’t even in the business in the early 1990s. They’ve never worked through a true buyers’ market.
And it looks like this one qualifies. In many real estate markets across the country, prices are being cut, the amount of time homes sit on the market has lengthened, and the “inventory” – the number of homes for sale in a given area – has increased dramatically.
If you’re a seller, you’ll want to do everything you can to bring as many buyers across your threshold in as short a time as possible. Here are a few suggestions to help increase your house-hunting traffic:
Find the right agent at the beginning of the process. Ask the agents to do a comparative marketing analysis and to list the marketing strategies they will employ while selling your home. These could include open houses (see below), or sending out mailings, such as flyers or postcards. You may also have to pay a little more in commission.
Give a bonus to the agent who brings the buyer to the closing table. While a great agent isn’t going to force a buyer to purchase a house just to get a cash bonus, he or she probably will include your house as an option as long as it meets the buyer’s criteria. Other options include big gift certificates, family vacations, or, if you’re trying to sell a very expensive house, you might consider giving away fancy car.
Let your neighbors know your house is for sale. Make sure to drop a complete listing sheet into your neighbors’ mailboxes. If your neighbors like the neighborhood, they’ll be more likely to recommend your house to friends and relatives who are shopping around for a new home. Want to goose your return? Offer a gift certificate to any neighbor who recommends the person who ultimately buys your house.
Take advantage of technology. Make sure the agent you choose has a website (personal or company) that can accept multiple photos of your property. You can even set up your own website so that anyone searching the web for property with your home’s amenities or in the neighborhood will find it. Consider paying someone to take a 360 degree photo, as well as extra photos of the interior and exterior of the property. More than 85 percent of buyers start their search for a home on the Internet, which means you’ve got to “Wow!” them online or they’ll never even look at your house in person.
Give your landscape an upgrade. Spending $500 to have your yard professionally overhauled will pay off big-time now that summer has come. Have a professional landscaping company trim bushes and trees, manicure lawns, plant colorful flowers and de-weed the garden. Exterior rooms are popular, so consider buying new, matching lawn furniture and movable fireplace pit to encourage buyers to think about spending their evenings under the starry skies in your backyard. This will help to give your home a good buzz throughout the neighborhood.
Ask your agent to do evening and morning open houses. Everyone works. Everyone is busy all the time, and if you have kids, weekends can be a tough time to look for a home. In some parts of the country, early morning “breakfast” open houses are becoming popular, as are evening “cocktail hour” open houses. Broker opens still work to get the word out in the brokerage community. You might try boosting attendance by giving away a $100 gift certificate at the broker’s open (you can draw their business cards from a fish bowl).
Make the most of a by-owner sale. FSBOs (those homes that are “for sale by owner”) tend to do really well in seller’s markets. It can be tougher in a buyer’s market. Be sure your ads say you will cooperate with a buyer’s agent – that is, you will pay a half commission to the agent who brings the winning offer.
Published: May 12, 2006
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