I read this crazy MoneySense article this week called Tricks Realtors Use to Sell Homes that really had me annoyed. I’ve been debunking it all week in my previous posts, but here’s another example of a sweeping over-generalization:
Almost every realtor uses the upsell—but it’s not just about a bigger commission. “Buyers are often unrealistic about what their budget can buy,” explained one realtor, “so you have to show them what an extra $50,000 gets.” But what’s the consequence? For the realtor, that extra $50,000 is an additional $930 to $1,250 in commission. For you, it means an extra $180 or more per month towards your mortgage.
The only remedy? Refuse to step foot inside any house that’s listed above your maximum budget.
First of all, if you didn’t show a buyer a property that was listed above their maximum budget, you’d be doing them a disservice. Unless a property has been deliberately under-priced to try to generate multiple offers, almost all properties are listed for more than what the seller is prepared to accept. It’s understood that an offer will come in below list. So why would I take a property off the table just because the seller has advertised it for more than I think they are willing to accept?
I agree that buyers are often unrealistic and that sometimes it does require showing them higher-priced homes. Telling them to refuse to step inside a house that’s above their maximum budget, however, makes no sense if that budget is unrealistic. This author seems to think we would better serve the client by continuing to show them properties that don’t meet their criteria. And the client is supposed to put down their foot and refuse to see something that does?
It’s not about commissions; it’s about price. Sometimes clients think they can get more for their buck than they can, and it’s our job to point out that that may require checking out a different neighbourhood than the one that they had their heart set on, or that it may not have the bells and whistles they hoped for.If they still want to be in a pricier neighbourhood, then we show them what’s available there, at the higher price. That’s not “up-selling.” That’s common sense. If we don’t have anything in their price range that meets their wish list, what would the writer have us do?
I will generalize, because I work in this business. Most of us take pride in finding our clients well-priced homes that fall within their means, and often well below what we know they could afford. Check out my sidebar for comments from some of my clients who paid less than they expected to find their home of their dreams.