Recently, I met with a potential listing client who happens to be a builder; an exceptional builder in fact. We were discussing selling his personal home, which I know he built with great pride and meticulous attention to detail. Well… He was not happy with me when I recommended a list price. In fact, he went off on a bit of a tirade about it.
“What!? Are you considering all the extra stuff behind the walls? Do you not point these extra features out to potential buyers? Don’t the extras make my house worth at least (extremely large $$ number with numerous zeros) more than a “normal” house?”
Well, yes, I do always focus on the best features of the property within the marketing materials, to the best of my ability. And in this particular case, I would put a relatively heavy emphasis on the build quality, specifically trying to target the type of buyer who would appreciate this aspect. But guess what?
Whatever is behind the walls is not normally what SELLS the house.
So what does SELL the home?
Answer: In almost all cases, it is the right combination of The Big Three, and not much else:
- Floor plan.
- Finishing details (the stuff you can see).
Hey, I don’t make the rules. That’s just the way it is. And here’s another very important truth that many people don’t seem to understand at first:
As the listing agent, I normally never meet the buyer of your house. I don’t know what they look like. I don’t know what is important or unimportant to them. I don’t know their motivation. Basically I know NOTHING about them.
This is the core nature of the agency relationship. I’m loyal to my client’s best interests. The other REALTOR® is loyal to their client’s best interests. I don’t tell the other REALTOR® anything about my client, and vice-versa. The only way I can communicate with a potential buyer is through the marketing materials and through discussions with the other agent. But I have no control whatsoever over what they discuss with their own client.
Therefore, when I’m wearing my Listing Agent hat, my primary responsibility is not actually to SELL your home, but to MARKET it to the widest possible audience. “Sales and marketing” are often lumped together as if they are the same thing, but they are not.
As a marketing professional, I need to first determine the profile of our target buyer, and then I design the marketing materials to appeal to that person. There’s a fine line between going into too much detail, and being boring. So, I pick and choose what I think are the most important features, and then I design the marketing to emphasize those features, in order to generate as many showings as possible.
After we’ve generated a showing, then we can go into more detail, but that’s another topic for another day.
If I’m going to limit the marketing focus to the most important features, guess what? I have to assume that my target buyers’ highest priorities are the same as they are for the vast majority of people – The Big Three. If I happen to have a house I’m marketing with some other outstanding feature (such as exceptional build quality), of course I’m going to emphasize that also, but this “extra” feature will likely not be my primary focus at this stage.
I’ll explain this further by simply spinning the table around. Let’s say I’m now on the opposite side of the transaction as I’ve described above. Someone else is representing the seller and I’m now representing the buyer. If the listing agent has done a good job, I’ve got all the details on all the good “stuff behind the walls”. That’s great, but first things first. The Big Three:
- How’s the location? Does it work for my buyer’s needs? How good is the accessibility in and out? Are there any concerns over future changes in zoning or future roadway expansion, etc.?
- How’s the floor plan? Does it flow well? Will it work for my client’s furniture placement and lifestyle? Are the various rooms big enough? How’s the storage?
- What are the finishing details like? Is the quality up to my client’s standard? Do the colours work for them (colours meaning hardwood, cabinets, etc. – stuff that is not easy to change)? How’s the fit and finish? What about appliances, doors and trim, exterior, etc.?
Here’s the punch line:
If the house doesn’t pass the Big Three Test, do you think my buyer clients even care about what is behind the walls? They don’t. They’re done. “Let’s keep looking.”
Now, let’s say the house does pass the Big Three test. That’s great! Now it’s possible that the “stuff behind the walls” may make the difference.
But it might not! It depends on exactly what “stuff” we’re talking about, and how important those features may be or may not be to a particular buyer. And, what if there are competing listings that have a slightly better location, or a slightly better floor plan, or slightly better finishings? Those features may outscore the “stuff behind the walls”. It all depends on the client.
And it depends on the premium being asked. If your house is loaded with amazing good stuff behind the walls, but it’s (extremely large $$ number with numerous zeros) more expensive than a competing listing with a similar Big Three score, chances are that you’re NOT going to succeed.
I know this drives my builder client crazy, but the cold hard reality is that people generally only pay for what they can see. I can tell my clients all about all the wonderful “stuff behind the walls”, and I do in fact stress the importance of quality to my clients, but I’m not the boss. The buyer is.