So, I have something a little different to talk about today.
It’s about the market, how you market and to whom.
Ok, a little backstory…
I’m very cautious and leery of taking business advice from anybody who has never failed in this (or any) business. As weird as this sounds, if you’re looking for a coach or mentor — you should only get coaching and mentoring from somebody who’s had a business that has failed, which caused them to fall flat on their face… and then they had to figure out how to pick themselves back up.
Because it’s going to happen again (I’ve seen it!), and when it does, they’ll have the experience and know-how from getting back up to work through it the next time it happens.
There will be a next time…
It’s the nature of any business, and especially ours with fluctuations in the market and the way REI is evolving — which leads me directly into the marketing idea I want to share with you today…
When you are marketing a home and you’re trying to set the price that you’re going to sell it for or you’re in the ‘making the offer’ stage… you need to look at what else is out there. Sold comps are important, but I’m telling you that going forward, active comps are going to be even more important.
If you want to sell something fast — make sure when you’re advertising the contract at the lowest priced product out there.
You know it’s not good when you’re having a hard time selling it — perception is reality.
Just like on the MLS, if you see a property that has been listed for 30, 60, 90 days… it may be priced right, but in the back of your mind, you’re thinking, ‘Hmmm, what’s wrong with that property? Why has it been sitting on the market for so long? Why hasn’t it sold yet? There must be something wrong.’
It’s the same in the wholesaling business. If you’ve been sitting on a property and you haven’t sold it yet, it’s been 3, 4, 6, 8 weeks… that smells like trouble.
So, when you’re making your offers, look at:
- what other similar properties are listed for on the MLS
- what other wholesalers are advertising their contracts for
- and pendings
Let’s put some numbers to this…
You’re trying to sell a house for $150k, and you see some pendings for $135k and an active for $140k.
With yours at $150k, you’re going to be in trouble. And, it doesn’t matter the condition of the property, even if it was perfect. Because of what else is out there, you’ve got to be more conservative.
You know the market changes and works to correct itself — and we have to change with it or we’ll get left behind.
So my point is: You need to be careful when you’re making offers. You can’t count on appreciation, for example, when you’re making offers.
Here’s something else to think about…
Every business has customers. Who are your customers in our business? Your customers are the buyers.
Because they’re the ones with the money!
A lot of realtors are going after sellers because they’re trying to get new listings, and they target sellers as their primary customers. But that’s a big mistake (in my humble opinion).
Pay attention to the buyers. Find out what they’re looking for, what their concerns are, what their fears are, and then go get what they want and bring the deal to them.
This is important: When you see the market start changing and buyers are leaving high-end priced markets like Florida and California… find out where they’re going. Be prepared. You’ve got to watch the market and pay attention to the smaller, cheaper markets and start thinking about virtual wholesaling.
Study the market, stay educated, listen to podcasts (like mine!), make smart offers, go where the buyers are — and you’ll do just fine through market changes. Because it WILL happen.
Follow my advice here, and you’ll be able to get through it.