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Nationwide Real Estate Company Sponsers Price Cut Event

I just saw the following announcement from a nationwide real estate company. I have some initial reactions to it which I put below the announcement.

I removed the name of the company and replaced it with (nationwide real estate company).

(nationwide real estate company)is promoting a sales event during which participating sellers who have listed their homes for sale through a company agent will drop their asking price by up to 10 percent.

Borrowing a page from the marketing plans of home builders and auto dealers, the “10-Day Sales Event” will run from Oct. 10 through Oct. 19.

“Our research and discussions with our brokers and sales associates shows that in many markets sellers remain reluctant to list their homes at the proper prices necessary to attract buyers,” said (nationwide real estate company) president and CEO, in a statement.

“It’s our hope that the (nationwide real estate company) 10-Day Sales Event will move buyers off the sidelines and into the market. We are embarking on this initiative — which has never been done before on a national basis — because we believe it is critical for (nationwide real estate company), as an industry leader, to help serve the needs of those individuals listing homes with a (nationwide real estate company) broker and to help move the U.S. real estate market in the right direction.”

The announcement referenced a company survey of 3,379 (nationwide real estate company) real estate professionals — 56 percent of respondents said that the listing prices in their market areas “remain above where they need to be to attract qualified buyers.”

1) Seems like doing this on a national level will penalize home owners in areas where the local market doesn’t need to drop asking prices up to 10%. Even the last line in the announcement says that 56% of their agents said the price is too high which means that the other 44% don’t need this marketing gimmick.

2) Does this real estate company take listings and price them too high for the market? If a homeowner isn’t realistic about the price, the agent doesn’t have to take the listing in the first place.

3) Doesn’t this send out a message that the real estate company’s listings are overpriced? What does this do to a home seller that has a listing with this company they think is priced right for the market? What happens after this “event” with homes still on the market with this company? Won’t Buyers submit lower bids regardless of what the comparable sales say?

4) The remarks in the announcement that this is intended to “help move the U.S. real estate market in the right direction” is troubling to me. It sounds like the priority is to create more sales for their agents rather than trying to get the best price for their home sellers.

5) I know some people think Realtors and car salesman are the same. Taking a page from an auto dealer’s marketing book doesn’t help with that perception, IMO.

Written by Keith Byrd - Go to Keith's Website/Profile