The delicate art of declining overpriced listings

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Here’s a dilemma — how do you politely turn down an overpriced listing?

This question was recently posed by agent Katharine Leblanc on Real Estate Hacks, a popular realtor-driven Facebook site. The response was sizable, reflecting significant interest in the topic. “I find this one of the most difficult aspects of real estate,” admits Leblanc, who, along with her husband Darren, heads up the Leblanc Group team with Real Broker Ontario in Sudbury.  

“How do you properly decline a listing without the seller being insulted and angry?” is Leblanc’s specific query.  

“We often decline listings that are grossly overpriced,” her post notes. “We sit down and show the sellers proper comparables, but sometimes they’re insistent on their property being ‘special.’ Once we decline a listing, the sellers often get very upset.” 

Poorly-informed friends and family may be feeding into the seller’s starry-eyed expectations around price. The issue could also be the proliferation of online home valuation tools being used by consumers. These leave various factors out of the equation and are often reported by realtors to be coming in too high by a substantial amount. As Leblanc notes, walking clients step-by-step through the comparables may help. But if it doesn’t, and you’ve got a seller who won’t budge on an impossible number, what then?

 

Letting down sellers gently 

 

Leblanc was impressed with many of the responses she received and intends to put them to use. Suggested phrases for letting sellers down gently include:

  • “I’d rather turn you down than let you down.”
  • “I wish I could get you that much.”
  • “I’d rather let you down now than later.” 

 

Another tip is, “Turn a negative into a positive.” Instead of saying that you can’t list the house at the price the sellers want, try spinning it so you’re telling them what would work. (‘We’d be happy to list it for $X.”)  

Says Leblanc, “That changes the tone. It’s really about the delivery.”

One popular bit of advice she’s repeatedly received is to take on the listing but have the sellers agree to a reduction clause after a certain amount of time on the market. Sometimes sellers have to see for themselves. Clients often tend to be more flexible after a week or two, with the property attracting little or no interest.     

Alternatively, you could suggest that the sellers get a professional appraisal and reimburse them if the house sells. Or the property could be listed at the inflated price for a couple of weeks; then you could hold an agents’ open house and provide feedback from that to your sellers, in hopes that it will turn the tide.

 

Protecting your reputation and your brand

 

Sandra Mifsud, who’s with Re/Max Ultimate in Toronto, believes that mentorship might be a good solution in these cases. A new or junior agent could be invited to be the lead, with the original sales rep available to offer guidance. “Even if it doesn’t sell or there are challenges, it will be great practice” for the mentee, Mifsud notes in her response to Leblanc’s post. And in the event the property does sell, “the two agents can negotiate a fair split, and it’s a win-win.” 

The reality is that many agents, experienced or otherwise, often take on overpriced listings in hopes of at least garnering other business and new clients for future deals from the experience. Leblanc was cautioned that this could potentially backfire, hurting an agent’s reputation and brand.

Or not.

“There’s never a bad listing,” insists Elton Ash, Re/Max Canada’s executive vice president. “You’re there to help them make the right decision. They need guidance, and they want honesty and transparency.”

It’s about using your sales and communication skills, he believes. If the client is really digging their heels in, “take the listing,” he advises. “Say, ‘let’s revisit this with the results in two or three weeks.’”

He points out that during that time, “you’ll be developing your relationship with them,” which could help contribute to a shift.

 

Advancing and honing your communication skills

 

The more advanced your communication skills and “emotional intelligence,” the more likely you’ll be to succeed at this, notes Bel-Air Realty Group’s Toni Sing, a Vancouver-based real estate podcaster. Unfortunately, she’s found that the industry training isn’t up to the task. 

“The training doesn’t prepare agents for these conversations,” she says.

In her opinion, it’s important to set out expectations and have a screening process for clients from the get-go. If someone is not a good fit, she may say something like, “I want the absolute best for you and your family. It sounds like you’d be better served by another realtor. Let me help you find one.”

That makes it about the client. “You representing them has to benefit the client, not just you,” she observes. “Put away your ego.”

Tailor your responses

 

Sing will switch up what she says to match the seller’s temperament (“you can’t blanket-statement it”), being more straightforward with hard-driving personalities who expect that.

Every situation is different, agrees Leblanc, having pored over the responses to her post and learned a few things in the process. 

 What, in a nutshell, is she taking away from this?

“Well,” she replies, “One agent said it’s called a listing ‘agreement,’ meaning both parties must agree. I appreciated that!”

 

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