John Bendall owner of Re/Max Classic Group suggests Losing weight and exercising to help restore market health

The two most common New Year’s resolutions
are to lose weight and start exercising. Both are worthy ambitions. I think
everyone involved in the real estate process could benefit from a fresh start
too. So, let’s set a goal to make ’08 better than ’07 by adopting these popular
resolutions.

1. Lose weight

There is a clinical term called “morbid
obesity”, which is defined as being at least 100 pounds overweight. Well our
market is more than morbidly obese because we have tons of excess inventory. At
the peak of the market our inventory was down to less than 2 month supply.
Today, based on the last three months sales pace, it would take us almost 10
months to sell everything currently on the market. (Absorption
rate) 

If we want to see this market move at a
quicker pace, it must slim down. This will only happen if it exercises more,
which should be our second resolution.

2.  Exercise  

Now comes the hard part. Agents (with the
help of sellers & buyers) can accelerate the slimming process by practicing
a few simple exercises. Let me warn you that you will not see immediate results,
but in time the hard work will pay off. So, put on your sweat
bands.

Agents, you may have to exercise courage by
saying “no” more often. Taking a listing that has no chance of selling is like
force feeding Twinkies to someone on a diet. It’s counterproductive. So, when
the seller insists on an asking price higher than you believe is reasonable, be
willing to walk away.

Courage will also be needed to call your
existing clients and inform them that your initial assessment of market value
for their property was wrong. Doctors misdiagnose. CPA’s file amended tax
returns. Reasonable sellers want the truth. They may not like it, but they don’t
like making double mortgage payments either.

Agents should have their Buyers exercise
better judgment in setting realistic expectations. This may come as a shock, but
in some cases, the asking price is a good deal. Anything less makes it an even
better one.

Sure, there are unknowns in this market and
buyers feel they have to tread carefully. But, too many buyers are over
compensating by making ridiculous offers, ones that sellers would not even
respond to in a normal market. Sellers have to muster up every bit of humility
to make a counter-offer. But when they do, the buyers walk away and refuse to
negotiate.  

If we keep these two resolutions, ’08 will
be a better year for real estate.

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