I was talking with a Diamond member of Pittard’s Winners Circle recently. The topic came around to telling sellers the truth about the likely selling prices of their properties.
This million-dollar producer said, “I tell sellers that in this market their properties will sell for $x. If they aren’t willing to price near that, I won’t take on their listing.” He hastened to add that he explains this to sellers more tactfully than that, but his point is that sellers must be told the truth about the likely selling price by their lister.
“It takes courage to tell the truth and jeopardise the listing”, I said. The top performer replied, “It’s more a matter of integrity”.
Of course, he’s right – avoid the truth, or alter the price to win the listing, and you tarnish your integrity and your reputation. So why are agents known for lying about the price, or lying by omission and avoiding price completely?
The answer is skill. It takes superior presentation ability to tell the truth in real estate and still win the business. If you intend telling the truth – and you should – you’d better be an outstanding presenter. And I mean outstanding.
But there are rewards, aside from the well-being that comes from knowing you tell the truth.
As an example, I attended an auction where the agent quoted $4.5 million to the sellers at the listing, and $3.5 million to the buyers during the open homes. He came unstuck when there was only one bidder at the auction. Now he had a $1 million gap to negotiate. Trust me when I say that he wasn’t that good a negotiator. It was passed in.
The property eventually sold for around $4 million, which was about the right money, but it could have sold months earlier had the truth been told at the beginning. And although the agent made this sale, will the sellers ever use him again? Will the buyers sell with him when the time comes? I don’t like his chances.
You see, integrity matters. You can’t be honest most of the time – it’s an all or nothing concept. Sure, it takes tact and finesse to deliver it, but the truth is an underrated sales tactic.
Why take on listings that aren’t going to sell? Why take on sellers that won’t listen to the truth, who don’t trust agents anyway, and who price so high that nobody enquires? Why take on sellers who aren’t serious, who consume your time, energy, your company’s money and your morale. When they leave to go to another agent, they don’t even sincerely thank you!
Even if you use the sellers’ money to pay for advertising, rather than your company’s money, it does your reputation no good when you take clients’ money and fail to sell the property.
Perhaps your market is so hot that properties sell anyway. But it won’t always be like this.