There was a very opinionated blog about "overpriced" listings recently in Reliberation.  I suggest you go back and look at it.

60/40?  I wish.  My experience is more like 98/2.  I seldom sell my own listings with 7000 agents in my town.

I agree with Steven. It is more like 98/2. I usually don't sell my listings either and most of mine are priced correctly.

Steven,

CONGRATS  on the 2% - LOL  

Our numbers are more along the lines of 99.5/0.5

I just saw that 7000 agent figure yesterday.  Wasn't it only 5000 two years or three years ago?  Good grief!  That's like 1 agent per 3 listings... when you look at it that way, we're doing pretty darned good. LOL

What happened after you adjusted the price? Also you did very well by picking up all of those buyers. 5 Buyers is alot - what was your secret?

I would think that if your company has about 40% of the agents working with about 40% of the buyers then you/your company as the listing agent would have about a 40% chance of bringing the buyer to the table. Othersie, perhaps the chances are proportionate to your actual market share.

As far as pricing, I have found most sellers including trusted friends and former clients just do not want to price at a very competitive price at the outset. They talk about coming down later or "wiggle room" as you say, so I have recently taken this approach:

I go into a listing appointment knowing the difference between what recent sellers are asking for their property and what they are actually getting. I show the seller the average time on the market for those houses that are selling, along with the estimated aborption rate for those home currently on the market. Then when I estimate how much longer it should take to find a buyer for each additional 1% of wiggle room they want to allow, the seller starts to look at the calendar and consider time against money instead of just the money.

Another alternative to prove your pricing point is to offer to reimburse them at closing from a Certified Appraisal. Let them choose any appraiser they want, and if you have done your "homework" your numbers will be in line with the appraiser's.

With a listing inventory of 30+ homes at the moment and just 1 under contract, and about a $1500 investment per listing on my part, my advice would be to NEVER take an overpriced listing.  Let them list with someone else.  They will call you in 3-6 months after learning at some other agents expense.  I took a listing yesterday wher I will be their 4th agent!!!  My job is already done, at least regarding pricing!!!

This was not always my opinion.  I used to want to take every listing knowing the sellers would come around eventually.  While it is true, the effort involved with servicing a large number of overpriced listings is not worth the return.

By the way, we are never too busy for your referrals...

Good thing for buyers:)

David,

You mentioned your investment of about $1500 per listing.  Therein lies the rub... most agents I know who take overpriced listings do little more than stick a sign in the yard and put it in MLS with one or two pics at most.

Those of us who actually spend our own money marketing the listings put a different value on getting it priced right to begin with.  We simply can't afford to do otherwise and have the listing expire without a sale.

First, great plan to throw an xtra month to make up for lost time, that was a good way of tackfully telling your sellers that they were asking too much$$.  My exp. has been more like 90/10 on the sale but that is why we all do what we do and it works so well.  We have found that a home priced correctly does get a lot more action and as long as the sellers are willing to accept the fact that the market is a sellers market then you will get their homes sold.  The market normal, I would have to disagree with that comment though!

BE DIRECT tell your seller the market has changed significantly the last couple of years .. when you were able to overprice a home and still have a good chance of finding a buyer willing to pay the price.. remember the basic economic law of 'supply and demand'  more buyers fewer homes available = Higher Price vs signifacntly more homes available same number of buyers = Lower Price ... keep in mind  .. 'an over priced listing is like having a car without an engine' you'll never go anywhere with it.  explain to your sellers how much it's costing them ... taxes maintenence heating cooling etc etc .. also when you host a public open house have the prospective buyers fill out a pricing evaluation and then show it to the seller  hopefully they'll wake up an smell the coffee...   good luck with the sale!

What are you do to market the property?  Regardless of the listing/buyer agent ratio (my experience by the way has been 95/5) you need to generate interest in your listing is what is a very competitve market (most especially if it is overpriced) as you indicated.

I don't know if I agree with the extra month wiggle room.  Overpriced listings "out the shoot" tend to detract other agent's who may have buyers "in the wings" from showing your listing for fear that a negotiated price will never be had;the listing becomes "stale".

Take a serious look at what you are doing to attract buyer's from not only your perspective but from other agent's perspectives such as broker's open with food, listing the home with it's own website, virutal tours, etc.  It's all about MARKETING!  Good Luck.

I love being a real estate auctioneer. The bidders choose the price. The sellers watch and learn and hopefully concur. Auctions are the only true test of a property's value at any given moment in time.

I built an auction company to help folks in early payment default or facing foreclosure. But nearly 100% of calls I receive are from sellers who listed their property too high for the past 1 - 2 years and now must sell or lose their minds. I am their market correction.

In my area it's probably more like one in ten where the listing agent sells their own listing.  If it's drastically overpriced, you have the same chance of selling it as any other agent. Almost none.

I'm with the 98/2 crowd and I agree don't take the over priced listing. I have turned down 2 this last year and couldn't be happier when I saw both of them expire. I stop by both those sellers to see what they thought went wrong and they both thought that their agent wasn't marketing the property right.

Both have decided not to sell now, but I agreed with them their agent didn't market it right. Didn't market it at the right price.

Todd

I'm with Todd and all the others 98/2. If you are selling 40% of your listings, I need you to write a blog and give up the goods so we all can learn from you.

I typically sell my own listings, but I never sell overpriced listings, yes I have taken them with hopes that the seller will learn to trust me. I present the facts (comps) and if they don't listen to that I list but tell them we will not get the calls if it is overpriced. If they just can't trust me enough to trust the information I am giving them is true, why did they call me? So, they call, I haven't had any calls on their property, lets reduce it to where it should be, they are just afraid they are golng to miss out on some $'s.  

In our area, it hovers around 70% of all listings being sold by another agent.  Could be another agent in the listing brokers office or another agent with another broker.  We have some big producers here who sell a lot of their own listings, much of this from new construction.  We are a fairly rural area, I might add.

We walk away from listings that are overpriced, but I still like your reset mechanism to pull them back to reality in one month.  We look at right-priced listings as a time management issue - it just hurts to waste time when you know it will come to no sale.  But then you generated 5 new buyers!  COOL!  So that's not a total waste of time.  Wish we had that kind of traffic here...

I agree with everyone else, if you're selling 40% of your own listings please tell us your secret! My market is probably about 99/1 with over 18000 agents (Houston TX). As far as whether to take the over priced listing...if you take it and don't do any marketing you aren't truly representing your client unless you've told them that you will not market the property until it is priced correctly. I tell sellers that correct pricing is imperative to selling their home quickly and to making the most money. If the home is too high any potential buyer that is looking during the first month will be missed because they can buy a similar home down the street that is priced correctly. Also, it is unlikely that those buyers will still be available to reconsider their home at a later date once they've adjusted the price correctly so those buyers are actually lost forever. I add that every month the home is listed incorrectly is another month of mortgage, tax and insurance payments so they aren't making as much as they think they are. Finally I tell them the longer the home goes unsold the harder it is to sell and the less likely they will get a higher price because buyers begin to think there must be something wrong with the property. As the other agents have said, this should be backed up with properties that have sold and actives on the market that reflect the days on market for properly priced homes vs those that aren't priced correctly. Ultimately, if you are paying to market a property that is priced incorrectly you are wasting your money knowing that you will not recover your investment if you do not sell the property. If you get five buyers off every over priced property you list it might not be a bad deal, however I suspect this is not generally the case. Goodluck!

Congrats on those numbers. I would not have taken the listing due to the cost of doing business, in this market we all need to price all listings right. Bottom line is it is my reputation an over priced listing is hurting not to mention my bank account. Should a seller not see it my way I will just tell them what it will cost them in the long run and let them know they should find another realtor, most of the time they do come back and sign with me.

Good luck

Jim

Price them right from the onset, and don't waste your time or that of an unreasonable seller. You are just setting everyone up for a frustrating experience in a market that now favors a buyer. Just as another stated, refuse the listing, go on to somthing that will produce $$ for you, and let someone else deal with it. Dave (my son) and I are partners and so far in '07 are at 71% in selling our own listings, and in our "lower priced" area are pushing 5 million in closed sales this year. We don't do open houses, but do network the heck out of our service area.