Proof There are Only two Things That Result in a Sale (Intelligent Pricing and Massive Exposure

Copyright © 2014- 2019  AUTHOR: Paul R. Marino, REALTOR®, e-Pro®

 

Within the past week, I came across an actual New Hampshire real estate transaction that speaks volumes to all the prospective home sellers out there getting ready for the launch of the Spring 2018 market. Bear in mind there is nothing unique about the fact the sale took place in New Hampshire, as this scenario can be found in any state, from Alabama to Wyoming.

 

The advice in this article applies to anyone contemplating selling their property in any of the 50 states, three territories, two commonwealths, and nine US possessions (Ok, you got me there, because you can’t actually own a home on the US possession of Johnson Island – a tiny little spec of an island 717 miles WSW of Hawaii, barely 200 yards wide). I have to admit, I do love compass directions and geography, as I'm a former air force navigator. Back in the old days - that is, in the days before GPS, we military navigators actually found our way with a compass and sextant (an ancient little device used to measure the precise angle to a star or planet). But I digress.

 

What you’re in for in this article is an education. You’ve already learned something new! As a seller, I encourage you to investigate all options when selling your property. This includes:

 

1] “Full service brokers” if you feel you just don’t have the time, patience, energy, or emotional stamina to participate in the sale, but also,

 

2] “A-la-carte”, or "limited service brokers" in the vast majority of states that allow them. These limited service states allow a real estate consumer to select specific services you need and require, but skip over those you would just as soon do without (saving literally thousands in the process). I encourage everyone reading this article to go to the following U.S. Government web site and learn the truth about your particular state.

 

Because the truth will set you free. Real estate laws have changed in the recent past, and you need to understand how these changes can work to your advantage. The transaction I referenced in the first sentence of this post is an actual, provable transaction that formally closed in the past week, after receiving MLS exposure for a grand total of 5 (five) days. It was listed by Firm "X" (the company that planted the sign on the lawn), and sold by Firm "Y" (the company that performed what many consider to be the "heavy lifting" in a transaction) - that is, the Buyer Broker.

 

Does anyone reading this post really believe (be honest) that Firm “X” had some “secret formula” and the reason it sold the house in 5 days is because they are marketing geniuses? Please. You didn't just fall off a turnip truck, did you? Everyone – and I mean everyone, has the same recipe (MLS, Internet exposure, Hype, Repeat).

 

I’m going to give you a sobering piece of information. This is given to you by someone that has performed literally thousands (not a typo) of real estate appraisals spanning nearly two decades (I retired from appraising in 2007 to turn to my real passion, which is renovating distressed real estate). And what is this piece of information? There are only two things that sell a house:

 

1] Price; and

2] MLS exposure. Period.

 

Obviously, other factors come into play (like location and condition – two factors no broker can change, but these (location and condition) are already factored into the price.) At the core, fundamental level, it's price and MLS that sells property. It's MLS that feeds everything [Realtor.com, Zillow, Trulia, and every website on the planet]. Hit MLS, and the exposure issue has been solved. Not to say your house is sold, but don't blame it on lack of exposure.

 

Here is some additional hard evidence. Just this morning, I selected two very large counties in the state, and focused on sales transactions on one singular day. On this particular day last week, there were a total of 23 closed sales across the entire landmass of two counties. Of those 23 sales, 8 sold in 26 days or less – in some cases, a lot less. That is, 35% of them were placed under agreement in less than four weeks. Heck, you couldn’t even get all your stuff packed in four short weeks. And of those 8 transactions, the days on market (DOM) in escalating order were: 4 days, 5 days, 5 days, 5 days, 10 days, 21 days, 21 days, and 26 days.

 

Another sobering statistic relating to the 8 transactions just referenced. 6 of the 8 [75%] were sold by a broker other than the Listing Broker. Meaning, it was a Buyer Broker from another agency that actually found the Buyer. I decided to quantify this ratio using a much larger sample size, and conducted a search of every single sale (more than 300 transactions) taking place in a medium sized New Hampshire city over a period of a year. A full 72% were sold by a broker other than the Listing Broker. 

 

I hate to sound repetitive, but it is price and MLS exposure that sells houses.  As long as the seller is in MLS, and is offering a competitive rate of compensation to the Buyer Broker (generally in the range of 2% to 3%), they will come. Trust me.

 

So, how much can you save? A Seller will pocket something on the order of $3K+/- for a home valued in the $100K vicinity, and $14K+/- for a pricier $500K property.  Take the mid-point ($300K), and you will be compensated $8K, give or take. (These numbers are realistic approximations based on brokerage fees currently being charged in New Hampshire and across the United States). For those of you with enough sophistication to see this isn’t rocket science, I encourage you to evaluate your options. This isn’t for everyone. But it could be for you. Be smart. Be informed.  GO TO:  US Dept. of Justice