My wife and I purchased our first home in May 2014. At the time, we couldn’t be happier. Open floor plan, updated finishes, big yard; this house had it all. However, after two years, we learned that home ownership isn’t exactly what it’s cracked up to be. Dealing with the constant cleaning and landscaping, pesky neighbors, and the endless list of home improvement projects had us burnt out. We were ready to sell.
At the time of this article, our house is still on the market. We’ve learned a lot from this process… a few things about life and even more about business.
No deal is a sure thing
The past 12-18 months have been very kind to home sellers. Demand has been high, supply has been low, and sellers have reaped the benefits. In our neighborhood, homes have been flying off the market and getting offers for $10,000, $20,000, even $50,000 over the original asking price. Suffice it to say, we thought our home would be under contract within 48 hours.
Boy were we wrong.
While we’ve had plenty of showings and interest from buyers has been high, we’ve struggled to get any quality offers. The market just didn’t react to our listing the way we thought it would.
This was a tough lesson to learn, but there really is no such thing as a sure thing. Whether it’s in business or in life, you have to be ready for any possible scenario. As the old saying goes, “Hope for the best; prepare for the worst.”
Pricing is hard
Pricing strategy may be the single most difficult marketing task for small business owners.
Do you price low and penetrate the market; or, do you price high and skim it?
What’s the competition’s pricing strategy?
How price sensitive is my target market?
How does price fit in with my product or service’s overarching brand strategy?
When we decided to list our house for sale, we couldn’t have been more aggressive. We looked at the comps around town and thought our house was poised to sell big. Sure, there were a handful of houses that sold for less, but ours was better, right?
What we quickly found out was that the market was shifting. Buyers were pushing back and being more patient. Supply was increasing, which was putting downward pressure on prices. The competing houses for sale around the neighborhood were pricing low, hoping for competing offers.
Unfortunately, it was probably not the right time to be aggressive. Hindsight is always 20/20, but this experience really showed how difficult effective pricing can be.
Markets can be unpredictable
If you were to tell me three months ago, that the housing market in my city would be stronger in January than in May, I would have laughed in your face. But, that’s exactly what’s happened. Based on the market data, both the number of showings and percentage of houses under contract were higher in January and February than May.
No matter what business you are in, markets can be unpredictable. One minute demand is through the roof (no pun intended), and the next we’re at a standstill. Even though there are an infinite number of highly-skilled professionals, market experts, and analysts out there making predictions based on thousands of data points, sometimes it doesn’t matter. The market doesn’t care. That’s why the first point in this article is so important; you never know what’s coming around the corner.
Listen to your audience’s feedback
My favorite part of this process has been receiving feedback from showings and potential buyers. Some of it’s been great; some not so much.
As a marketer, I love feedback. Whether it’s a customer survey or sifting through Google Analytics, I love figuring out what our audience really wants and what marketing strategies are poised for success.
Typically after every showing, we receive a completed survey from the buyer’s agent. The multiple choice questions are helpful, but it’s the open-ended responses that have really been beneficial.
The answers have facilitated big decisions such as re-staging rooms, tweaking our MLS listing, and even making price adjustments. This objective feedback has facilitated major strategic changes that have led to mostly positive results. By listening to our audience and taking the appropriate steps, we feel we are closer than ever to accepting an offer.
Hope is not a business plan
I’ve never been one to sit back and hope good things will happen. Whether it’s been in business or in life, I’ve always found that a proactive plan is considerably more effective than doing nothing at all.
The process of selling a home has been much different than I could have ever imagined. There have been ups-and-downs; good days and bad days, but I’ve always felt solace knowing that there is a plan and we are tweaking and improving that plan every day to reach an end goal. While it may take some luck to finally close a deal, hope won’t have anything to do with it.