It's the Competition Stupid!

By
Real Estate Agent with Keller Williams Realty 0575737

In a slowing buying cycle in the residential market I am always curious about the dynamics of why a buyer selects one house over the other. Beyond condition, location, and qualifying for the loan, I probed deeper. Buyers do buy on emotion and that's where their "gut feel" takes over. Many of the women make the final approval since they just seem to have better intuition.

MansionWhat I have determined a key element in choosing one house over the other is floorplan or basic layout. How does the house flow? I saw two houses (one pre-owned, one new construction) that had an EXTREME U-turn rear driveway entrance into the garage. Even I don't think I could get a car in there. They both have been on the market exceeding 200 days. So the floorplan / layout issue comes down to competition. Do I have to live at this price with this wacky driveway? NO. Not when for the same price in the next neighborhood I don't have this problem.

Stealing and modifying from Bill Clinton, "It's the competition stupid!"

Home sellers need to understand this and preview similar properties in their price range. You only can change what you can change, then it's time to lower the price.

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Ambassador
883,319
Lane Bailey
Realtor & Car Guy
Century 21 Results Realty

You used Bill Clinton and stealing in the same sentence... people might get made...  I'm not one of those people. 

But seriously, I think that the "gut feeling" is just the manifestation of things about the house that WE should be able to identify even if the buyers can't.   

November 14, 2007 09:28 AM
Rainer
13,122
Mary Ann Grafft
Keller Williams Realty
It's the smart man that lets the wife make the final selection!
November 14, 2007 11:00 AM
Ambassador
1,529,897
Gary Woltal
Assoc. Broker Realtor SFR Dallas Ft. Worth
Keller Williams Realty
Mary Ann, I've heard the woman signs off on the kitchen while the garage and the backyard are what the man looks at. Who knows, but I hear these little stories.
November 14, 2007 12:25 PM
Anonymous #4
Anonymous
Anonymous

Nice looking house.  You are right about changing what you can and then adjusting price for what you can't.

Thanks for your help today on my post Working on My Outside Blog: TheRealEstateZOO.com  

November 14, 2007 05:29 PM
Rainer
103,798
Rosario Lewis
GRI, SRES - DDR Realty - Orange County, NY
DDR Realty
Getting unrealistic sellers to preview the competition should help some see the light.
November 14, 2007 06:13 PM
Rainmaker
352,037
Donna Yates Real Estate - serving
North Georgia Metro & Mountains
ReMax Town and Country
Any seller that doesn't understand "competition" by now, well is one who I would rather pass on.   I don't know what more can be done when a Realtor suggests every possible idea to get a house above the others and the seller doesn't do any of them.  What more can a Realtor do when the agent shows the seller comp after comp and they still don't get it.  I say it's time to say "Next" and move on.  The unfortunate thing  is the seller will still blame the Realtor for the house not selling. 
November 14, 2007 07:53 PM
Rainmaker
639,894
Marchel Peterson
Spring TX Real Estate E-Pro
Results Realty

Gary, I agree what a house is worth is whatever other homes in the neighborhood are selling for.  If a house has something quirky the only way they are going to get it sold is for it to be a good deal.  When I have buyers looking to buy the deal with the quirky floor plan I always try to remind them that when they sell they will also have to give a discount to account for whatever it is that is making it a good deal.  Good post!

November 14, 2007 07:58 PM
Ambassador
1,529,897
Gary Woltal
Assoc. Broker Realtor SFR Dallas Ft. Worth
Keller Williams Realty

Donna: All you can do is educate the buyer. Sometimes they don't listen.

Marchel: Buying something out of the norm will end up selling it at a discount to overcome out of the norm. 

 

November 14, 2007 09:31 PM
Rainmaker
713,597
Barbara S. Duncan
CRS, GRI, e-PRO, Searcy AR
RE/MAX Advantage
Driveways are very important.  I've noticed many houses that you'd have to make several attempts to get into the garage.  They take longer to sell.  Good blog.
November 15, 2007 09:58 PM
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Gary Woltal

Assoc. Broker Realtor SFR Dallas Ft. Worth
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