Posted by GregNorman on April 06, 2000 at 20:27:41:
I’ve worried about this in the past… “How in the world will someone except a sales price 5-10% higher than market value?”
Let me answer that with a story that happened today. I get a call from a mortgage broker on a L/O that I assigned about a year ago. The t/b is now qualified and looking to purchase. Mortgage broker had a few questions for me so I look thru my paperwork to recall the transaction. Market value at the time was about $98k for this 1940s vintage semi-detached home. I told the owner a year ago ‘We’ll L/O it for $117k.’ The neighborhood was a little sketchy and the mort payment was at rental values so we assigned the contract for $3k and we’re out of the picture in terms of risk (I’m also getting $100/mon from the t/bs, too). At the time I thought 'I don’t know how I’m going to do this for $117k. Market isn’t even close to that! Well, here we are… purchase time. My friend owned a home right down the street, exact same floor plan. I say ‘owned’ b/c my wife just sold it for $119k in one week (they wanted to sell fast) and it wasn’t as nice as the home we l/o’d. I bet it’s worth about $125k.
So now I’m thinking ‘Wow, all that worrying about something that ended up being a benefit to the t/b.’
Now I don’t have any issue with raising the sales price and I know how to handle any objection that comes up with the t/b. So don’t feel bad about raising that sales price… you might not be actually raising it!!