The value of the role of pricing in marketing is clear when property listings are few and far between. When it’s difficult for real estate agents to win listings; we typically see the rise of pricing strategies with the only goal of winning the listing. Some real estate salespeople are even paid sales bonuses just to win listings.
Any professional real estate agent of significant worth finds the use of a promise of a price strategy to be totally insidious. Why? It creates a false expectation for the seller. It completely wastes seller advertising dollars at the critical launch time of the listing.
This type of pricing strategy basically commits the seller to up to ninety days of disappointment with very small numbers at open homes or no inspections all, and ultimately extends the time the property is on the market.
Inflated Promise of a Price Delivers Disappointment
As if that’s not bad enough, the property owner can also lose tens of thousands of tax-free dollars in a missed potential sale price for the home. A promise of a price strategy ultimately delivers disappointment— as the seller must eventually lower the price to meet the market since the salesperson only won the listing by means of an inflated promise of a price.
A delay in the sale of the current property may result in a real possibility that the next property purchase price may increase to the point where it is out of reach and not affordable. Talk about shattered dreams!
The Promise of a Price Only Lists a Property— the Marketing Process attracts the best buyer to the property and sells it.
What can a seller do to protect themselves from falling victim to promise of a price marketing? It’s simply a matter of doing some research and a little bit of homework. Fortunately, once you know what to look for and equipped with a few key questions to ask, it’s easy to spot the salesperson that is using the promise of a price strategy
Start by checking in the local paper where you will see that only after a few weeks, the new listing banner on a property will have been replaced with a price reduction banner emblazoned across it. Sadly, this clearly confirms that the salesperson may have purposely lied to the seller(s) about the price expectation. Why? Just to win the listing.
To add insult to injury; the listing agent may have also received a bonus for just getting the listing with no incentive or intention of selling the property at all.
There are only two reasons a property isn’t sold. Price or Agent. Which do you think it is?