Recently, I have had many clients share that their inventory of move-in-ready homes, in certain areas and price points have been piling up. Clearly when rates were lower, many builders understandably felt emboldened and bullish about building Inventory, and now with normalized to difficult market conditions, are starting to feel the pinch.
Now is the perfect time to analyze your inventory of Showcase homes and create systems and processes to ensure that we sell these homes seamlessly and profitably. If we don’t work this out now, then unfortunately, in some instances, they could become what is known as a “workout” with the banks.
I have created a whole White Paper on this topic, full of much more detail. If you would like a copy, please click on the link at the end of this blog. Meanwhile, here is a three-minute read with just the highlights and best practices, to ensure that you have a proactive plan in place to sell your showcase homes from strength and with passion while maximizing profitability.
I love acronyms as a way of remembering to keep things simple, and created this one a decade ago to help us analyze our inventory and make the necessary changes easily and effectively.
M = Marketing
A = Appearance
P = Pricing and Promotion
For this blog, I will focus mainly on Marketing, and touch on Appearance, Pricing and Promotion. The White Paper has much more detail on Appearance, Pricing and Promotion.
Review all marketing material and ensure that your showcase homes are being marketed correctly. Such as:
Most MLSs around the country automatically link to Realtor.com and Zillow. The two platforms between them brag over 300 million unique monthly users. Add in Redfin, and now both Home.com and Livabl, and you have a plethora of great opportunities to attract potential buyers. Of course, not all the buyers are looking in your area, but this tells us that buyers all over the country are searching for their dream homes online. With that in mind, how do your listings stand out from the crowd? We humans have short attention spans these days, so you have 8 seconds to grab your buyers' attention. Here are some tips:
Is everything up to date and also specific to each home, or just a broad brush homogenized approach? Are you treating these homes generically or as individual prized possessions? Remember, we are selling the dream of home ownership, where each home should feel unique and represents your end users' vision.
Features such as stunning kitchens, millwork, fireplaces, and unique views. Are they featured early in the MLS picture deck? Forget five pictures of the foyer, or pictures of perfectly vacuumed carpets in guest bedrooms, and focus on the most exciting features to grab your potential buyers' attention.
When I was managing sales a few years ago on the West coast of Florida, we did a MAP analysis and realized that many of our aged homes that hadn’t been selling had gorgeous views, in some cases both front and back. We took photos of sunrises over ponds, one of which even had a little Bambi coming out of the fog. Guess what, the phone started ringing with excited buyers.
Often listings are so confusing, I just reviewed one that had pictures of another finished home that wasn’t even the same floor plan. I would have no idea what is being built, when it will be available and where it is located.
As new home sales professionals we teach selling from macro to micro. The same should apply for your listings, show a map depicting the great location, and then the community, amenities and most especially the homesite.Simple Google earth snippets will suffice to show buyers the location. If there is any kind of a view or hot buttons associated with this, then add these photos early in the deck.
I was just reviewing a listing with an excellent salesperson in New Hampshire. The home under construction was part of a small infill with three quarters of an acre home sites, and you could walk to downtown Portsmouth in under five minutes, or hop in your car and be on the major highway in under five minutes; so ideal for commuters.
The salesperson is now going to add to the MLS listing, a map showing the short walk to downtown as well as access to the major highways, plus photos of the oversized homesites surrounded by trees and nature, as well as write all of these benefits into the comments. Now a customer will understand immediately the location, community and homesite benefits of the home, and be far more likely to both show up to view the home, as well as begin to fall in love with the location features and benefits of the home. Also, since most major buying decisions involve some compromises, let’s say the guest bedrooms are too small or the homesite backs up to a road, the buyer will be more flexible, because so many of their other boxes are checked. Whew, all of that from reviewing and improving the listing in MLS!
Do your unfurnished homes look flat, lacking emotion or sizzle? There are so many companies out there such as Box Brownie, who can stage rooms virtually, and fix the architectural style to look like a Norman Rockwell painting at dusk, all for a nominal investment.
For the record I have been ridiculed many times by far more sophisticated marketing types for my old fashioned beliefs in fliers However, in front line sales, we need to be able to narrow down to one of a kind and create a concrete connection to a specific home. Sitting down at the end of every demonstration and recapping, is an integral part of the three act sales process, so that the buyer understands all of their choices completely; making it easy for them to move forward with the purchase. Individual fliers are proven to be the most effective at this. So “take that” you elitist naysayers, we sales guys need our fliers. Here are some tips:
If you have a larger number of “move-in-ready” homes that are completed and you are concerned about moving them, then proactively create a collection and a campaign of the homes you wish to feature. Decide what to call this collection and how to promote them. This way, you can assign marketing dollars to focus on these move-in-ready showcase homes, as well as add a tab on your website and create a conversation point, excitement, and drive in traffic looking to move in quickly.
How is the appearance of each showcase home? Are they in mint, good, or bad condition? Clearly, mint is what they all need to be to entice today's discriminating consumer. What changes could you make to improve the appeal of each home? Such as landscaping, flowers, exterior or interior paint, adding appliances, lighting, or maybe fencing to provide privacy. How many times do we say things like:
“Bring me a buyer and we will add the ___________ or fix the _______________.”
I hate to be the bearer of bad news, but in a normal to tough market, this doesn’t cut the mustard. Buyers have lots of choices, especially as we go up in price. They need to be dazzled in order to be tempted to part with their hard-earned money.
Are these homes priced fairly, or are some overpriced? And we are hoping that our buyers are mind readers and will know this, and make us a fair offer? Let’s admit that this is probably a fairy tale we have been telling ourselves for too long and instead do the hard work of coming up with a bona fide pricing and promotion strategy. Begin by making sure you provide a detailed CMA (Competitive Market Analysis) so you understand the market values, how you compare, and what you may need to do to sell your homes. What pricing adjustment could you make that would help them to sell faster?
“Incentives don’t make buyers out of non-buyers;
they just make real buyers but more quickly.”
Roland Nairnsey
What kind of promotion are you currently doing for these showcase homes, and how could it be improved? Decide whether you would like to have a published incentive or implement more of a “back pocket” approach, and then train your sales team how to use these potential savings effectively. To accomplish this at an advanced level is such a complex matter that I have added pages of details in the White Paper, on how to increase sales, preserve profits, and then how to implement successfully.
We need to appreciate that to implement an incentive plan, we have to follow the following four Golden Rules.
Let’s chat about number four: always have an expiration date. We have all experienced that when our incentives expire at the end of the month, our potential buyers get used to this and start to game the system, and start their negotiation around the 30th of the month. The white paper is full of ideas and proven strategies that will help you control the sale and liberate you from backpedaling and having to acquiesce to unreasonable buyer demands, and instead will place you in the driver’s seat. How does that sound? I thought so, take control and make more sales.
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Click to Download the White Paper
Selling Showcase Homes Successfully
“Work it out before it becomes a Workout.”
I hope you have found this quick-read blog helpful. Please feel free to reach out with any questions, to share your successes, and please let me know how I can help in any way possible.
