Even in a seller’s market there are always “hard-to-sell” properties. At the height of the frenzied market during the pandemic years there were still properties that remained unsellable.
There will always be properties that simply do not meet affluent buyer expectations, whether it’s due to location, price, size, or the state of repair. Ultimately, and especially in the luxury market where many homes are unique, the salability of a property, no matter if it’s a buyers’ or a sellers’ market, will lie firmly in it matching current buyer trends.
Meeting the demands of today’s affluent buyers
Privacy, wellness amenities, lifestyle experiences, the latest technology, turnkey condition…today’s affluent buyers want it all. Despite higher interest rates and fewer properties to choose from, they’ve become more demanding and selective than ever. Current statistical data shows that when the right properties come on the market there is a corresponding uptick in sales. If we look closely at the “list to sold” price ratio, it’s stayed close to the asking price for these properties. In some cases, we are still seeing multiple offers and over asking price offer. Equally, they tend to sell quickly.
Understanding both macro influences and micro impacts at the local level will be the key to making these unsellable properties sellable.
National trends are very important as they provide an overview of the significant importance of parameters such as new inventory compared to actual inventory levels, the list to sold price ratio and average days on market. They explain buyer preference changes, as well as demographic and technology impacts. Equally it’s time for REALTORS® to really dig deep into their local market’s data to appreciate the micro influences. By analyzing location, property types, amenities and property features that are attracting buyers you can discover the common denominators that are determining why these homes are selling close to list price.
Understand buyer preferences beyond price point
If you can dig into the attributes of what’s selling and figure out what buyers want, whether the property is worth $2 million or $10 million becomes somewhat irrelevant; it is the other parameters that will provide you clear guidance on the advantages, opportunities and roadblocks for your sellers. Taking this approach now provides you with a concrete foundation to create a strategy to sell challenging homes.
First, you will be able to share this knowledge with absolute clarity to your sellers. You will be able to provide them with data that supports what buyers are searching for and the attributes, features and amenities they are willing to pay top dollar.
Second, it provides the opportunity to collaborate with local contractors, renovation specialists, home staging professionals and interior designers to create a comprehensive package that makes the process of getting the home ready for sale less of a challenge for your sellers.
Third, use the first two to build a marketing strategy that leverages how you can effectively market and showcase their home and turn it into a property that creates interest from potential buyers.
Leverage property features
One of the most important factors to remember is that there is a buyer for every home but, although price does play an important role, reducing it might not be the only way to achieve a sale. While a home can be renovated, restyled, or updated with the latest technology, not all parameters can be changed. This is why it’s critical for a REALTOR® to leverage the unique features while not shying away from the negatives.
The principle of sacrifice
The Principle of Sacrifice is a marketing concept where instead of trying to hide negative features through clever verbiage or ignoring the problem entirely, you address the issue head on. For instance, if a home is in a desirable location but has a steep driveway, this could feel like an instant roadblock. Consider the benefit instead: typically this would mean unhindered views. Be ready to sacrifice potential buyers for whom a steep driveway is an absolute no-go. Instead target those looking for views by stating clearly that a steep driveway positions the home to offer 360-degree views.
By implementing these strategies and leveraging the unique strength and weaknesses of the luxury property, you can effectively market and showcase the listing to attract potential buyers and maximize its exposure in the competitive luxury real estate market.
Stay ahead with the institute
If you want more guidance on how to grow your luxury real estate practice and develop your skills when working with the affluent, learn more about the Institute’s training options here.
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