Seller Close — The “I’ll Wait and Get a Better Price” Close
It is quite common for sellers to want to wait for conditions to improve before they sell their home. The belief is that next year they’ll be able to get a better price. As a trusted advisor, you must point out the risk of using this strategy. The seller pro-forma can help a seller identify the actual cost of waiting, with one of the riskiest costs being attributed to potential depreciation. By asking your sellers about the following economic issues, they will have a much better understanding of what the risk of waiting may be.
1. Unemployment – Unemployment is presently over 9%. It may be a long time before unemployment drops significantly. Isn’t it likely that high unemployment will continue to put downward pressure on prices?
2. Energy Costs – Gas prices continue to flirt with the $4/gallon mark. If gas prices trend toward the $5/gallon mark, how do you think that will impact the price of your home?
3. Economy– Despite aggressive stimulus programs, the economy has continued to sputter. With the recent completion of the QE2 government stimulus spending which artificially bolstered the economy, is it possible we could experience a double dip? And if we do have a double dip, what do you think will happen to housing prices?
4. War In the Middle East – Political unrest has been a problem this year all over the world. With explosive issues continuing to unfold in the Middle East and Africa, global economic deterioration will lead to even greater conflict than political unrest. How do you think this uncertainty impacts the future price of your home, especially if world conditions worsen?
5. Deficit – Time is running out for US leaders to come up with a budget resolution. Credit rating agencies are threatening to downgrade US debt rating, which could ultimately lead to hundreds of billions of additional interest payments on the 15 trillion dollars of US debt. This problem could take years or even decades to resolve. What impact do you think this situation has on a real estate recovery and more specifically, the price of your home?
6. Inflation – Prices for consumer goods, energy costs, food prices, and healthcare continue to skyrocket, leaving the average American worse off as each month passes. Does this situation indicate any possibility of improving real estate prices in the foreseeable future?
7. The Dollar – The value of the US dollar continues to sink on world markets questioning the integrity of the US banking system. Does the sinking value of US currency help you or hurt you?
8. The European Debt Crisis – The economies of Greece, Italy, Spain, Portugal, and Ireland continue to deteriorate. How do you think an economic meltdown in Europe will affect housing prices?
Remember when discussing the myriad of economic issues presently facing the United States, don’t just bring up the fact, always ask your sellers a question that forces them to acknowledge the substantial risk they are taking by waiting to sell their home.