High value mandates: What is your approach as an estate agent?

As a real estate agent, one of the trickiest situations you can be confronted with is that of mandates with inflated price expectations. Sellers may have an optimistic view of their property's value, which can make it difficult to set a realistic price that reflects the market. In this article, we'll look at the pros and cons of working with such mandates and discuss the different approaches real estate agents can take to manage this complex situation.

The advantages of mandates with overpriced expectations:

1. Increased profit potential: If you manage to sell the property at the seller's asking price, this can result in a higher commission for you as the real estate agent. In some cases, when the market is booming, it may even be possible to sell the property at an inflated price.
2. Opportunity for negotiation: While higher price expectations can be a challenge, they also offer an opportunity for negotiation. You can work with the seller to gradually adjust the price as offers to purchase are received. This can lead to a compromise acceptable to all parties.
3. Maintaining a relationship of trust with the seller: By accepting a mandate with higher price expectations, you show the seller that you take his wishes seriously and are willing to work together to achieve his goals. This can strengthen the relationship of trust between you and the seller, which can be beneficial in the long term.

Disadvantages and challenges to consider:

1. Extra time and effort: Working with higher price expectations may require more time and effort to market the property, arrange viewings and negotiate with potential buyers. You may need to provide more market analysis and comparative data to help the seller understand the reality of the market.
2. Risk of extended selling time: When the asking price is much higher than the property's real value, this can lead to an extended selling time. Buyers may be deterred by too high a price and choose to explore other options. This can affect your reputation as a real estate agent and slow down your business activities.
3. Possibility of not closing the sale: In some cases, overpricing expectations can lead to a failed sale. If the seller is unwilling to adjust the price in line with market reactions, the property may remain on the market for an extended period, or not sell at all.

Approaches to managing mandates with high price expectations:

1. Provide factual data and analysis: As a real estate agent, it's essential to provide the seller with objective market data and analysis. Show them examples of similar properties sold at realistic prices so they can have a more realistic view of their own property's value.
2. Establish open and honest communication: It's important to establish open and honest communication with the seller right from the start. Clearly explain market trends and pricing realities. Encourage the seller to be receptive to comments and feedback from potential buyers.
3. Implement a strategy of gradual price reduction: If the seller is reluctant to set a realistic price from the outset, propose a strategy of gradual price reduction as the property remains on the market. This will maintain the interest of potential buyers and avoid excessively prolonging the sale period.

Working with mandates with inflated price expectations can be a challenge for real estate agents. However, by adopting a strategic approach, providing factual data and establishing open communication with sellers, this situation can be managed effectively. Ultimately, the main objective is to help sellers set a realistic price that maximizes their chances of selling their property within the desired timeframe.