In this episode of the Million Dollar Playbook, Sharran does Part 2 of the Intelligent Pricing Series highlighting the final two strategies from the series—three pricing strategy, and buyer sensitive pricing. Aside from sharing tips on how to handle pricing with your clients, two callers – Eli and Rod also jump on the show to share some pretty practical tips anyone can use. The bottom line? Pricing is about more than your expertise as an agent, it’s also about how well you communicate your value to the client.
3 Key Points
- As the agent, it is part of your job to manage the process of pricing the property and to share what you are doing to give added value to your client.
- Build a relationship with your client, appraiser, and other people involved to get the most out of the deal for your client.
- Doing a pricing strategy relies on your expertise and open communication with your client.
Show Notes
- 00:10 – Today is a special episode as this is part 2 of the Intelligent Pricing Series done 2 weeks ago
- 00:28 – Sharran did not finish the Five Strategies to Make Pricing a Collaborative Discussion with Clients and will continue it today
- 01:13 – Sharran says there is not a lot of confidence on how we communicate our pricing
- 01:29 – You’ll never lose a listing on price
- 01:41 – Recap of Part 1
- 02:02 – Take a research-based approach to how every appointment gets done
- 02:13 – Ask yourself the five questions: what did you do well, what can you improve upon, what questions did the client ask us, what ideas can we develop, what are my next steps for the meeting
- 02:52 – Pricing has three fundamental areas:
- 02:57 – Verbal dexterity – use your language very carefully
- 03:30 – Strategic thinking – pricing is a strategic exercise
- 03:42 – Being a trusted adviser – the pricing discussion is where the core of being a trusted adviser is
- 04:07 – The Three Strategies from last time:
- 04:10 – Number one is discovery – always know what your client is trying to accomplish
- 04:20 – Tell your client “I know you have already done the math. Can you walk me through it so that I am aligned with you?”
- 05:02 – Number two is neighborhood value spectrum – the value of the house is related to the value of the neighborhood
- 05:33 – Number three is the disassociation and pricing strategy – check out the video Dichotomy of Pricing
- 04:10 – Number one is discovery – always know what your client is trying to accomplish
- 06:24 – The Fourth Strategy comes from Peter Loewy, chairman of Teles – the three pricing perspectives
- 06:37 – “Pricing has got to do with how 3 sets of people will look at the home outside of the buyer”
- 06:55 – The first perspective is agent or realtor pricing
- 07:12 – Realtor pricing is driven on market dynamics and the realtors understanding of the buyer momentum of the market place
- 08:11 – The second perspective is the appraiser perspective
- 08:20 – The appraiser is booked value focused
- 09:28 – The third perspective is the contractor
- 09:55 – The contractor brings the quality of construction perspective
- 10:15 – Physical inspection of the property can be done before it is put on the market
- 11:01 – Explaining the three-pricing perspective helps the client understand that the agent is not the one assigning value to the house
- 11:24 – Make the client believe you know the strategies involved to get the result they want
- 12:15 – As the agent, you should manage the process of pricing very well
- 12:56 – The Fifth Strategy is buyer sensitive pricing
- 13:21 – Explain to your client the client’s perspective, buyer sensitive pricing and market sensitive pricing
- 13:37 – Market sensitive pricing strategy is to the sellers advantage
- 14:01 – The client has a choice when to list the home, where to list it, what strategy to use, marketing and the target buyer profile
- 14:38 – Buyer profiling is checking the data on the neighborhood if the houses were sold on financing
- 15:21 – If the buyers need to have a loan or already has a loan, there is a need to have an appraiser friendly strategy
- 16:42 – Buyer sensitive pricing is rarely used by agents
- 17:02 – There is also a different price and different pricing strategy if the buyer is a developer
- 17:11 – The first contingency of developers is the physical inspection
- 17:43 – If you already did a physical inspection, you’re going to get better offers
- 18:14 – Build a pricing strategy that does not alienate any kind of buyer pool
- 18:34 – Agents should always do two things for the client – educate them and show extreme value that will benefit them
- 19:13 – When a property goes under contract, Sharran builds a relationship with the appraiser by preparing the report and meeting with him when they come to the listing
- 19:32 – Appraisers will only look at the data available in the internet, by giving them your report, you can place the value closer to the offer price
- 20:10 – Sharran says agents should articulate this process to clients in the living room because that is an extra value you are giving them
- 21:51 – Caller Eli talks about getting a contractor, and how an estimate and aesthetic modification can give comfort to the buyer and credibility to the seller
- 22:55 – If there is a written report from the contractor, Eli will share it with the buyer but if not, he would advise them to ask their own contractor
- 24:24 – When doing a counter offer, the inspection report will also be attached
- 24:51 – This tells the buyer that the agent knows what the condition of the property is and has taken it into consideration when making the price
- 25:41 – To recap the five things – discovery, understanding the value spectrum of the neighborhood, disassociation and understanding pricing strategy, three pricing perspectives, and buyer sensitive and market sensitive pricing
- 27:38 – Rod shares his strategies and pricing
- 27:44 – When you set up a listing appointment, schedule the first 30 minutes in their living room or office and ask them to drive around the neighborhood with you for the last 15 minutes
- 28:33 – Personally, Rod always gets the listing when the clients get in his car
- 28:47 – The client will also see how you work and a there is a friendly and easy tone
- 30:27 – There is a multidimensional value add
- 31:22 – This is one of Sharran’s biggest takeaways for the week
- 31:51 – Rod says when you have them in the car and see someone walking outside, honk and wave and that person will wave back even though they do not know you
- 27:44 – When you set up a listing appointment, schedule the first 30 minutes in their living room or office and ask them to drive around the neighborhood with you for the last 15 minutes
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Show Notes provided by Mallard Creatives