Using the Web and social media to sell real estate

Today I went I spent the whole day with my family. We had a very nice lunch together at the local Applebee’s (one of the best places for eating American food) and then we all went to visit a wild birds sanctuary right on the shore of the Gulf of Mexico. The place is pretty small, but has all kinds of wild birds including some predators like hawks and vultures.

Be like this free pelican. Stay out of the cage of old style selling.

I was looking at the pelicans being fed by the hostess and I noticed a lot of fish laying on the ground and the birds not even considering it. Actually, as the fish was thrown at them, some pelican would let it fall on the ground and wait for a new fish to be launched. I asked the hostess the reason for such a peculiar behavior and she explained: “They are spoiled. They only want fresh fish and they won’t pick it up from the ground. We have to pick it up and put it back into the pool fort them to eat it”.

At the same time there were some free wild pelicans just outside of the cage waiting quietly for some extra food to be available for them while the captive ones were kind of running all around and spoiling what was thrown at them.

…

…
Observing this scenario it came to my mind that it looks exactly like the real estate market right now or like the media advertisement market since the arrival of the Internet. Buyers seem never happy with what they get and the more you discount the less they are willing to pay, and the salesmen and women that follow this route don’t understand they are doomed.

I have seen it happen in the media market: advertisers always wanting to pay less for pages and standard ads and the salespeople trying to follow them with always wilder discounts and resulting in the dismissal of whole magazines and newspapers. You can’t keep selling the same old way when the market has changed so radically as with the arrival of the Internet. You just need to create something unique and present it effectively.

Let’s look at the real estate market in the US. I have read statistics according to which 90% of houses get sold by 10% of Realtors. This means there is a whole lot of people out there that are starving and can’t sell properties in the new climate. I don’t know if the percentage is correct, and this is not a tirade againstb Realtors (they play an important and definite role in the real estate market) but we can safely assume that there are some Realtors out there that didn’t adjust to the new climate. When you deal with one of them the typical experience is the following: the Realtor is eager to get your listing and comes to see your house and runs some comps (comparable sales analysis) coming up with a price that will for “sure magnetize the attention of buyers”.

This price is usually lower than you would hope, but it is acceptable enough for you to sign the listing agreement. The house goes on the market and nobody shows up or some tire kicker shows up giving some negative comment or some low ball offer. Now the Realtor (if she is a loser) comes to you and coaxes you to lower the asking price so to have a fast sale. She will usually tell you this sentence: “There are two types of houses: those that sell and those that are priced too high”.

So you reduce the price and wait. Still no real progress. So a new reduction of price is suggested and the cycle repeats until you sell your house at a ridiculous low price or you don’t sell at all because the constant decrease of the price invites potential buyers to wait further or to come with even wilder low balls.

Naturally you can have a house that is priced too high in which case it will be more difficult to sell, but reducing the price constantly on the MLS is the sure way to shoot in your own foot. There are ways to overcome a price that is too high by leaving as it is and asking for offers starting from a “base offer price” that is way lower than the asking price and giving a time constraint. Done cleverly, this tactic can sell the house for a real fair market value and in a short time using a smart Realtor. And this is one of the approaches chose by the 10% of winner Realtors that you should try to hire or imitate in order to have success. Professional sales people know that the price is never the problem. The uniqueness of the offer is what it takes to make the sale, in any market and with any product.

Roberto Mazzoni