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Creative Real Estate Selling

Posted on 08/11/09 2 Comments

[I wrote this last year after getting the job done for a selling client using a reverse offer]

Is Your Agent Creatively Aggressive in Selling Your Home?

Michigan has been in the throws of a buyer’s market for at least 3, if not nearly 4 years.  Here in the Ann Arbor real estate market, the market is a little more fluid than the rest of Michigan, but as agents, we have had learn to adapt quickly.

Creatively Aggressive is my term for how some agents are representing their clients’ interests in this tough market.  In the examples given, the focus is on protecting the client’s interests and maintaining the fiduciary responsibility between client and agent.

Here’s an example of an agent being creatively aggressive :

The Reverse Offer

The seller has a property on the market, competitively priced, aggressively marketed, and the number of showings has been steady, but no one has put pen to paper to purchase the property.  When a buyer shows interest in the property and returns at least one more time to see the property, it’s time to make a reverse offer.

The reverse offer is simply an offer from the seller to the buyer to begin the purchase conversation.  Obviously the buyer is interested enough to see the property multiple times.  That indicates that the price, location and value combination are making the property “sticky” in the purchaser’s mind.

What the reverse offer looks like is different from property to property, so consult with your Realtor(R) before an offer is put together.  You may want to submit a reverse offer with a price lower than your list price, or you may want to submit an offer with a higher price and seller concessions.

As a Realtor

Keep in mind that you have a fiduciary responsibility to your sellers.  With regards to the reverse offer, this means that you need to protect their interests.  As you construct your reverse offer, bear in mind that the list price is what your clients have stated they will sell the home for.  If you state in your offer anything less (without explicit permission from your clients), you may be breaking that fiduciary responsibility.

The offer that we wrote was the list price as a purchase price plus the seller picking up 6% of the buyer’s closing costs – this was and remains a common practice in our real estate market.  By building it this way, the purchase agreement simply made it clear that we wanted to get a yes/no decision from the potential purchasers.

If no, then my clients could say, “Next!”

If yes, then we were off to the races!

What About the Buyer?

This option can also be utilized by a purchaser in a buyer’s market.  The effectiveness varies, but I have found that it is totally dependent upon the seller’s willingness to try something unconventional.  When my purchasers have indicated that they would be happy to purchase either home A, B, or C, I have asked the listing agents of those homes to submit an offer to my clients.  I simply state that there are multiple homes they are interested in, it’s a buyer’s market and we are acknowledging and embracing this fact.

For my buyers, it’s an opportunity to not be tied to one contract to purchase and gauge a seller’s willingness.  For my sellers, it’s an opportunity to end some of the suspense, and show purchasers that we are serious about moving the ball forward.

What have you seen used as a creatively aggressive way to sell homes?  I’ve heard rumors of using eBay, selling the handmade, scale doll house, with the actual house thrown in for free (Great Marketing idea!), free cars…. What have you seen and what works, I suppose, are two different questions!

10/16/08 Follow-Up: Bottom-lined a reverse offer within 1.5% of list price using this technique on behalf of my sellers.  Clients are very happy!