Prepare your seller for the market

The house is ready ... what about the owner?

by David Rathgeber   No doubt you spend a good deal of time getting your seller’s home ready for the market. Even more importantly, you will need to prepare your seller. Warn your seller that when agents make an appointment, it probably is only an estimate of their arrival time. The reason is that the agent will be on a tour of several homes, and the buyer will control the pace. Yes, it is better if your seller can be out of the home for showings, but this is frequently an unreasonable expectation.

Just the facts—and keep them brief

Counsel your seller against discussing compromising information. If a buyer has questions about the home, answers should be direct, accurate, and brief. Questions about the price, closing date, terms, or other details of the transaction must be referred to you. Plan in advance exactly how your seller will handle the inevitable question: Why are you moving? A polite but vague response probably will be innocuous. Mention of a job transfer, divorce, foreclosure, etc., should be avoided.

Your seller should not discuss irrelevant topics such as sports, religion, politics, or the possible sale of the grandfather clock or other furniture. There is no way to know which of these topics might ruin a contract. So, he should be polite, brief, and stay focused on the goal. Of course, he’ll keep any pets, as well as pet "surprises," out of the way anytime the home is to be shown.

Stay away but note buyers’ actions

Your seller needs to realize that one should never, ever tag along during a showing. He cannot help: Most agents will readily find the pantry as well as the linen closet. Many of us will even be able to figure out on our own which is which.

If your seller happens to be at home and notices that a prospective buyer shows unusual interest, asks several questions, or spends a long time, he should know to give you a call as soon as the visitors depart. When these buying signs are noted, prompt follow-up is required. In addition, if a buyer returns for a second visit, you need to be advised at once: The home is probably on the buyer’s "short list." Your seller should know how to contact you immediately.

Don’t keep sellers in the dark

Be sure to let your seller know how many showings to expect daily, weekly, or monthly and about how many showings are required, on the average, to sell a home. If activity is slow, once a month you must:

• Determine how to improve the marketing effort, or ...
• Determine how to improve the property or its presentation, or ...
• Recognize that an extended period will be required to find a buyer, or ...
• Adjust the asking price: As a general rule, a price reduction of 5% or more is considered significant to the market. Single price reductions of greater than 10% should be avoided.

Resist the temptation to take the easy way out by doing nothing except rekindling your seller’s hopes. Your inaction almost certainly will lead to another month of market inaction for the home. Remember, to today’s homebuyer, the three most important factors are price, price, and price, in that order.

Get analytical and take action

If there are a reasonable number of visitors, but after 15 or 20 showings there is no buying interest, this indicates that the market exposure is fine but the price is still a bit high to draw an offer. Buyers are coming, but they are finding measurably better value in other homes on the market. Corrective action should be taken in the form of a price reduction, so your seller’s home will stand out as the best among the competition of lower priced homes.

At least once a month, and especially when considering a price change, you should obtain updates on competitive homes. Important factors are homes new on the market, homes recently sold, and price adjustments made by competitive homes.

If your seller notices an unusual number of drive-aways (agents arriving with buyers but not coming into the home) spend some time at the curb to determine what is lacking in the appeal.

If corrective action can be taken, do not hesitate. Also, ask the seller to make a note of agents’ names and phone numbers when they call to schedule a showing. This might help encourage agents to come in when they arrive, and will allow you to ask those who drove away without entering what was so objectionable. If the problem continues and is indefinable or incurable, then a price reduction is needed.

Be prepared for an offer—it could come any time

If contract forms are standardized in your area, you should provide your seller samples of the forms for review when you first list the home. If appropriate, they should also be reviewed by the seller’s attorney so that any questions can be resolved at an early stage.

During the marketing period, you must periodically remind your seller that all the effort will pay off. But when he’s halfway through the marketing period, he will see no milestone by which to measure the progress. He will not have 50% of a contract. An offer usually will come out of the blue when least expected. If your seller plans to be away for more than a day, he must let you know where he can be contacted. This is important. Many buyers, especially job transferees on a house-hunting trip, will not wait and hope that you might find your wayward seller tomorrow.

David Rathgeber is consistently among the top REALTORS® engaged in residential real estate, and his talks focus on practical ideas that have been proven in action. This article is excerpted from David Rathgeber’s Agent’s Guide to Real Estate, which is available in major bookstores and through Internet booksellers. Copyright© 2002, David Rathgeber. All rights reserved. For information, please contact the Frog Pond Group at 800/704-3764 or email susie@frogpondgroup.com.

Illustration © Artville.

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