Property Value 911 – When Your Client is Way Off

geo2You worked hard to convince the client that listing with you is the way to go, and no all that’s left to do is prepare the listing agreement and determine a sale price. Until… your client tells you that they think their home is worth far more than it is.

This happens all the time. There are so many reasons that clients think that their homes are worth far more than they are:

  • What their neighbours tell them – the person across the street listed for…
  • What contractors tell them – I did some improvements to the home…
  • Too much TV –home renovation television convinced them a new coat of paint added another $25k on their home’s value

This a delicate conversation because a home is the biggest investment most people will make and telling them that it is not worth what they think could result in them wanting to work with a real estate sales professional who agrees with them.

  1. The best way to have this conversation with a client is to be well researched before the conversation even happens. Look at the sales history on the home, run neighbourhood comps but select some individual comps that are indisputably similar to the property in question.
  1. When you go to speak with the client put on your listening ears. Your client will be more likely to accept what you have to tell them if you have heard them out completely – even if you don’t agree with them.
  1. Present the evidence – don’t just tell them you have performed research and believe a good list price is $___. No. Sit down with your client and show them your comps and how you derived the value.

Make sure they understand the cons of listing too high:

  • People may not even come to see the home because their real estate sales professional may tell them it is overpriced and not worth looking at
  • Being on the market too long without selling can actually harm the property’s value
  • If you agree to a higher price they may have trouble getting financed

If they still insist, after leveraging your tools, that the property is worth more all that’s left to do is suggest that they have an appraisal.

Dealing with clients who think that their homes are worth far more than they are is a challenging problem that you face all the time. This is why it is so important to be informed and have access to the best technology to do your homework.

Use GeoWarehouse to derive accurate value estimates to help convince unrealistic sellers. Find out more at www.geowarehouse.ca.