Last Updated on April 7, 2017I listed a home that was smaller and priced higher than others in the area, at least on a “price-per-foot” basis. Everyone, and in particular real estate agents, is very nervous about a house that ends up being priced above the neighborhood average. The general belief is that you invite trouble if your house is priced (on a per-foot-basis) higher than others.
But a high price per foot is not a barrier as long as one condition is met:
Can you prove the home is superior?And that of course, is not a real estate function — it is a marketing function. It doesn’t matter if you sell new homes, small homes, big homes — whatever you sell — our job is to have prospective buyers to see our listing as DIFFERENT. The goal is to make a buyer want your listing over others on the market, even if it has a seemingly negative feature — whether that’s a higher price, a small backyard, or anything else. That’s what sellers pay us for. Sadly, the real estate industry seems to completely miss this reality, content to keep printing flyers or posting ads online that boil a home down to nothing more than value based on size comparisons. There are countless examples of other consumer products than do not get priced based solely on comparable size.
A great example is, a 4-door Chevy and a 4-door Mercedes are essentially identical on paper. They are the same size. Each has four doors, cruise control, ABS brakes, leather seats, tinted windows, power door locks, etc., etc.
But no consumer dares march into a Mercedes showroom trying to negotiate the price of a Mercedes down to the price of a Chevy based on the nearly identical specifications. Why? Because Mercedes never allows its “product” to be marketed on this basis. You buy a Mercedes if you want people to think you are successful. In other words, the German automaker does not sell cars at all…it sells status symbols.Which brings me back to the sale of my latest listing…
A marketing secret that sold a small home in 7 days, and how YOU can sell more listings in less time…This home was only 1,850 square feet, yet the price was about $400,000. This put the price over $200 per foot, yet it was in a neighborhood that averaged only $115 per foot. This is considered suicide because the question is, “How do you charge almost TWICE the going rate?”
Here’s the secret…Educate the prospective buyers about the benefits of the home. The ad I used was most definitely not a typical real estate flyer.
Think about how crazy the price is for a Ferrari — a $300,000 car with just two seats and no trunk. But, does Ferrari try to sell you the car by listing out every part? Of course not. They describe what it would be like to drive this car, to own one, like this…
“With a Ferrari, guess what happens to your blood pressure when you fire up the throbbing, 700 horsepower engine wrapped in the elegant design of a legendary Italian race car painted in a color they call “Arrest-Me-Red”? Own this car and you’ll always have a fast lane through life.”After reading that description, can’t you feel yourself sitting in the driver’s seat of a Ferrari and revving up the engine? That’s one way to make an emotional connection — get someone to “experience” what it’s like to own what you’re selling. I did this with the small home featured in this article and it sold in less than 7 days once it hit the market!