Many agents spin their wheels trying to go out and list more property when they are currently holding a large listing inventory. When you are in the need of a quick sale, the fastest income generator in the real estate industry today is an accurately priced listing.

There is an incredible gold mine in your current listing inventory if you can just get your sellers to reduce their overpriced listings. But how do you get a seller to be realistic about price when they are convinced their house is worth more than the market will bear?

The answer is quite simple: timing, communication and education.

Timing

Do you know that the majority of properties listed are overpriced? With the market changing every single day and sellers wanting more and more, this creates a perfect recipe for an overpriced listing. Sellers often are not prepared to hear the truth about their home's market value the day they list their property. The question is, do you take the listing when you know it's overpriced? Of course you do, because what the seller needs from you more than anything else is your patience with their unrealistic pricing expectations.

Most sellers say they will never sell for anything less than they are listed for but as time goes by, their price demands diminish, so correct pricing is all about timing. You need to be in the right place at the right time and that right place is in the seller's good graces when they finally believe that their property is overpriced and are ready to reduce.

Communication

Most agents' communication with the seller diminishes as time goes by because they are embarrassed that there has been no activity on their listing. However, the secret to price reduction success is to increase communication with the seller. If the seller believes you are truly working hard for them and are giving them the facts on a regular basis, when they are ready to get realistic they will reduce with you.

How do you get a seller to believe they have overpriced their property? Most sellers need time and proof that their property is indeed overpriced and not just underexposed by the Agent. The seller will not reduce the price of their property if they are not convinced that the agent has done everything possible to sell it at their asking price!

Education

It is your job to educate your sellers about pricing. If you do take an overpriced listing because your seller needs time to "test the market", it is critical that you help them understand the basics of pricing using the following tools.

The client must be able to see that the market determines market value, not the realtor and not the seller. Here is what you can do to demonstrate this for them:

1. You will take the listing at their price but will contact them every week to inform them of market changes. The market will either act positively or negatively to their price.

2. You will review the price with them every three weeks and will supply them with a new up-to-date CMA.

3. You will inform them of all competing properties that have sold and will supply them with addresses so they can drive by and do their own market research.

4. You will contact them every week and let them know of new competition that has been listed.

5. You will inform them of all market changes, marketing and showing feedback on a weekly basis. The market will respond with calls, showing and offers. If these are few and far between, then this indicates that the property is overpriced.

6. You will expect them to do small (3 to 5%) price reductions on a regular basis if the market is not responding positively to their market price.

Agents as advocates

If your sellers know that you are watching the market closely for them and reporting the facts to them they will be receptive to pricing changes. Before you go out and get more new listings make sure that the properties that you have are on their way to price reductions.

If you communicate with and educate your sellers on a regular basis then your chances of getting a price reduction are extremely high.

Remember, it's all about your seller's timing. Pushing for a price reduction too soon without communication and education is a sure way to have your sellers stick their pricing heels in the ground.

Proper timing is your key to pricing success - and consistent honest communication is how you make it happen!

Published: January 22, 2002

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The founding partner of The Lones Group, Denise Lones, brings over two decades of experience in the real estate industry. With expertise in strategic marketing, business analysis, branding, new home project planning, product development, and agent/broker training, Denise is nationally recognized as the go-to for all things "real estate.” Denise can be reached at 369.527.8904 or at www.thelonesgroup.com.