How to Coach New Buyers Through Today’s Low Supply, High Demand Market


Here's some great language to use with buyers as they're entering the market today. We know it's a high demand, low supply market.

But how do we coach them through this process?

One way is by using the "Auction Analogy." You can do this by talking about a list price as being almost like a reserve price. So the conversation (which you can see below), will give you a good way to help buyers understand what's happening in the market dynamics. You can simply say:

"Hey, now that you're entering the market, I just want to kind of give you a little overview of what's happening in terms of pricing and where sellers are at. We're in a very low supply market and a very high demand market. So, on average, sellers are receiving a least four offers per home. Now some receive less, some receive more. But in general, we're going to be competing for a buyer for a seller's love. We're going to be competing with other buyers. So we want to come in with a really strong offer.

One way to look at list prices today, unlike past market's is that the list price is more like a reserve price in most cases. Unless the sellers really overpriced it. But if they priced it to the market, the list price really becomes like a reserve price and an auction.

What that means is that that's the lowest the seller will accept. And it's likely that price will go much, much higher than that. It's highly unlikely any buyer's going to build to negotiate less than their list price.

So that's just something to be aware of as we're entering the market. You know, my job, we're not buying the market, we're buying a specific home. I want to find you a great value. I want to find you a great home that meets all your needs."

So that's the conversation you can have to get buyers up to speed and thinking about how they're going to approach the market.

If you wait to have that conversation until they're writing an offer, there's going to be much more resistance. You want to have it as early in the relationship as possible.

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