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Longer Days on Market Does Not Mean It’s OK to Lowball
The days on market are getting longer in Sacramento and, in particular, where I sell a lot of homes in Elk Grove. I would not go so far as to say that my real estate activity in Sacramento is 100% indicative of what’s going on across the board, but there certainly are parallels due to the vast territory I cover as a Sacramento real estate agent. Lots of agents work in only one neighborhood but I cover four counties and, as I have promoted the crap out of, I am the # 1 Sacramento agent at Lyon*, so I see a lot of listing activity up close and personal.
In fact, I wrote a newsletter for homebuying subscribers at About.com about the longer days on market last week and no sooner did I send it out last night than I received an almost duplicate piece from some other company. Coincidinky? Perhaps.
The reason I started to look at the days on market is because homes had been selling so quickly last spring, but once we got past mid-summer, the days on market began to grow. When days on market get longer, it seems that some buyers expect to lowball. I don’t know if they do this on the advice of their agent or if they saw it on TV show somewhere but the strategy for days on market can change depending on market swings. Our real estate market in Sacramento has swung. We’re pretty much back to normal and nobody knows how to handle it, it seems.
When I asked an agent to explain why her buyers wrote an offer at 85% of market value, her retort was the days on market were almost 30 so that meant the home was overpriced. What is this? Laurel and Hardy? Where did she get that idea? I’m not sure if it’s clueless agents or ignorant buyers or a combination of both or maybe something else that’s in the water, but 30 days on market is pretty darn normal. In fact, many homes are taking 45 to 60 days to sell in this market.
And they are selling at market value, which in most cases is list price. I see this is my own inventory of homes for sale. But just to show independent third-party statistics, I pulled a chart from Trendgraphix, which also illustrates this point and attached it to this blog. You don’t have to take my word for it. Take Rod Stewart’s: Every picture tells a story, don’t it?
Image: Trendgraphix, Day on Market and % of Sales Price to List Price, February 2014.
*per Trendgraphix stats for units sold, Sacramento County
Did You Forget to Sell Your Home in Sacramento?
Did you forget to sell a house in Sacramento last year?
You might not think it’s possible for a homeowner to forget to sell a house in Sacramento but as a real estate agent, I can assure you that it happens. I often joke that if some agent just followed me around and picked up the real estate business I leave lying on the side of the road, they, too, could be a top producer. My biggest drawback is I don’t continue to ask sellers if they are ready to sell. I don’t want to insult their intelligence. But I also realize that sellers sometimes forget which agent they have called, much to my dismay.
It’s completely arrogant to assume that a seller will think only of calling this Sacramento real estate agent when she’s ready to sell. I mean, many do and wouldn’t dream of hiring any other agent because they believe I am the best Sacramento real estate agent for them, but people are different from each other — what one person does, another does the opposite. Not to mention, they have other things going on their lives than simply concentrating on selling a home. They have children, families, vacations, illnesses, financial complexities, career demands, political distractions, community involvement — complications to everyday life that often take precedence.
From now on, my plan for 2014 is to not let any business slip through the cracks. I will politely stay in touch until the cows come home or sellers tell me they no longer have any interest in selling a home.
Sellers don’t always use analytical criteria when hiring an agent. They sometimes believe by mistake that all agents are the same, so hiring the guy across the street or their Uncle Joe, doesn’t make any difference, when it can make ALL the difference in the world. They don’t know that the top 10% of agents sell 90% of all the homes in Sacramento or how to find that top 10% or even why it makes a difference.
And whose fault is that, that they don’t know? Fortunately, I know the answer to that question, and my focus in 2014 is to answer it for clients. If you’re getting ready to sell your home in Sacramento, call Elizabeth Weintraub at 916.233.6759.
Using a Multiple Counter Offer to Sell a Home
Be still my eyes — C.A.R. is offering a two-hour webinar for real estate agents to explain how to use the new Multiple Counter Offer form. Two hours! One-fourth of a normal work day. How stupid do they think real estate agents are? Oh, wait. Duh. Don’t answer that. But two hours? Criminy. Come to think of it, I just used that form a couple weeks ago and had to point out to the buyer’s agent that it was indeed a multiple-counter offer situation, as that was not readily apparent, for some reason.
The agent didn’t realize it until I said I do not know how the second buyer will respond. I explained that he needed to know that it was entirely possible that his offer might different than the counter sent to the second buyer, because that’s how multiple-counter offers can work. As a REALTOR who works in Sacramento, I try very hard to be fair to all real estate agents, and not just because it’s required by the Code of Ethics.
It looks to me, though, that what C.A.R. basically did was take the counter offer out of the multiple-counter offer document and made the counter offer a standalone, leaving the multiple as a multiple. Yet, it’s still fill-in-the-blanks.
It’s not only buyer’s agents who are confused. Sellers also do not understand the power of the multiple-counter offer. It is one of the most remarkable documents we have in our arsenal for offer negotiation. If a seller in Sacramento, say, receives two purchase offers, a seller can issue a multiple-counter offer. The multiple-counter offer can be different to each buyer, depending on how the seller wants to work the negotiations.
Think about this for a minute and let it sink in. Nobody says that one of the offers is an offer the seller wants to accept. That second offer could even be a lowball. It could be written on a roll of toilet paper. The seller could even suspect that the lowballer wouldn’t take a counter offer if she threw in 2 round-trip tickets to the moon. Yet, that doesn’t prevent the seller from issuing a multiple-counter offer now, does it?
Once the listing agent explains to the buyer’s agent that there is no regulation that states each counter offer must be identical and that the listing agent does not know whether the second buyer will increase the offer, what do you think that first buyer will do? See, this is why sellers and buyers in Sacramento and Elk Grove love working with me.
A Tip for Sacramento Listing Agents About Showing Followups
My personal belief, as a top-producing Sacramento real estate agent, is every single one of my sellers deserves to hear about all of their showing activity. I mean, just put yourself in your seller’s shoes. Your home is for sale, you see business cards on the table when you come home so you know agents have shown it, but you hear nothing from your Sacramento listing agent about those showings? You would have no idea about what’s going on if your agent doesn’t follow up.
And that is not a good place for a seller to be. That, people, is a place of anxiety. My intentions are to never make my sellers anxious or stressed out. Part of my job as their listing agent is to make the process of selling a home in the Sacramento Valley move as smoothly as possible for my sellers, with the fewest hiccups and disruptions.
For example, even if I have nothing to say, if for some reason there has been no showings for a week and not much has happened in the neighborhood, I still try to check in with my sellers and provide them with updates, even if it’s nothing more than # of hits in MLS. For crying out loud, something probably sold within 6-block radius or a new home came on the market, and sellers might want to get that information from their Sacramento listing agents. You think?
I am constantly analyzing why a home might not yet have an offer. The difference between me and another agent is I try to share those thoughts with my sellers — to come up with a new strategy if my existing strategy is not giving us the results we want. With some homes, we just need to wait, be patient and continue present marketing because there might not be as many home buyers in that particular price range.
But to not follow up after an actual showing by a buyer’s agent with buyers in tow, well, that’s unthinkable in my book. Following up with the buyer’s agent is easy, yet many agents don’t do it. They say buyer’s agents don’t respond, and that’s true, some of them don’t. But some provide valuable buyer feedback. By contacting buyer’s agents, I’m also giving them my email address so they can quickly address a concern their buyer might have had but they didn’t yet have time to ask me.
Here’s how Sacramento listing agents can do it. Go to MLS and click on your listing to open it. Click on the box that says “SUPRAweb Showing Activity,” which is located under the row of photos on the very left of the page. That will open a small window in your browser showing all of the activity for that particular home. Don’t stop there. Instead, click on Log On to SupraWEB, on the right-hand side. Sign in with your user name and password.
This will take you to your Showing Dashboard, which reveals all the showings for all of your listings. You can change your dashboard date range but I keep mine set to the past 2 days because I constantly check this dashboard. Right there, in front of your face, are the emails, times accessed and all of the information you need about every single buyer’s agent who showed your listing. Click on the email, and it will automatically open an email for you to send the buyer’s agent a message.
And there you have it. Now you have no excuse not to keep your sellers updated with feedback from agents who have showed their homes. This makes your sellers happy, both of you informed, and it gives you a chance to build a rapport with the buyer’s agent.
Home Staging in Sacramento is Worth It
There are some markets in which a Sacramento real estate agent can barely get her sign planted in the front yard before her email starts dinging with purchase offers, which can make home staging pretty much overkill. This Sacramento fall market of 2013 is NOT one of those markets. Oh, but you might say there isn’t much inventory, but there is almost twice as much inventory as we had last spring. But half of that inventory is overpriced or a mess. So, in that regard, you’d be right, there isn’t much inventory.
This means if you want to sell your home quickly, without a lot of fuss and for a decent price, you’ll need to do home staging. You can hire a professional stager or you can do it yourself with your listing agent’s help, but for best results, get the home staged. This doesn’t mean you need to be deceptive, but your home is now a product and must be sold like a product. When a buyer walks into your house, she better be walking into a commercial that says buy me as she rounds every corner.
Agents are influenced as well, and while you would think an agent can look past the disarray, it is never a good idea to let a buyer’s agent view a home in less than stellar condition. I made that mistake once a number of years ago, and I allowed agents to preview a home that wasn’t ready for the market. Beds were unmade, toys strewn about the floor and clutter everywhere. I thought the agents could see past it, but they couldn’t. That image was ingrained in their minds, and it took me a long time to sell that home, even after it was fixed up and ready for sale.
Now, my policy is nobody gets in to see a home before it is staged and ready. Of course, not every seller is willing to stage. It doesn’t mean I won’t list the home because I will, and I will eventually sell it, too. Just not as fast. And maybe for not as much. Like I said, not every market requires staging. But this fall market in Sacramento definitely is screaming for quality inventory in tip top shape.
