Mistakes Sellers Make - 4 Important Listing Principles When Selling Your Home In Hawaii

Alright guys, in today's video, Kenji and I, we're going to go fishing, stay tuned to see if we actually caught. Are we fishing or are we catching? We're going to go over four listing principles, we're going to talk about how do we come up with how much your home should be worth, what's the range, where is it derived from, is it data driven, is it emotional, countering, being aggressive, respecting offers. We're going to go over all of that in the video. We're also going fishing and looking at the most untouched part of Oahu and all of its beauty and glory. It's Kenji's birthday, so in the comments section, everyone, happy birthday Kenji, his birthday was recently and he's a fisherman. We actually started the video right there. We are going into Tamora's, if you're local, you know about Tamora's. I don't know what a mainline equivalent would be. But anyways, we're going into Hawaii, Hawaii's local grocery stores, we're going to get some bait. Also for me, I just had all kinds of stuff happening. We're actively negotiating offers for our seller. So the situation here is, well you guys have seen this listing, our Nahiwai place, this beautiful crown jewel of this area in Kaneohe, and today is the offer review day. We have multiple offers, it's a competitive situation. The family has their reasoning why they would go with a certain offer. Their offer was above asking, but they know how competitive this is and we're going to give them the chance to increase their offer to come up. And that call's going to happen right now. I guess it's not happening right now. I'm always thinking the worst in these situations. So is he intentionally not answering me, does he want to play games? They're not really in a position of leverage to do so, and he's a nice guy, so I have to assume that he's just busy, because good agents are busy. Hopefully this happens here soon before I have squid on my hands. There's two of us agents involved, so I'm working with a guy named Chance, who we'll just say is a good cop, and I'm an aggressive cop. It's not that we intended it that way, it's just how it kind of has developed, and this agent sees me as that guy, you know, that aggressive negotiator. I know that they are in a text exchange. He said I'll call you in two minutes, but I'm just going to let this sit. Actually look, right now he's calling. I'm not going to answer right now, I'm going to let him reach out to the other agent. I feel like silence is the loudest thing right now. So I'm going to let this sit, I'll give him a call after we go inside, get some food for fishing. I'm not going to give away too much of the trade secrets, you know what I mean? By trade secrets, I mean the negotiating tactics, when to stall, when to, you know, pin the bishop and the queen and all that. Another trade secret I will give away, best gas station, even though no more gas over here, best gas station food around. You never ate? Wait, last time we were here you got, yeah? Yeah, yeah, yeah. Oh, what is this? You know what? You grew up that side, huh? Yeah. Tell me, are you guys willing to pay 15 cents for the bag, or are you like me, you ain't paying for the bag? Oh, almost lost a slipper. Okay, let's get in this truck and let the negotiations ensue. Hey, what's up man? You know, just flat out, straight to the point. They like Scott Dan, but they were disappointed. You know, and there's four, we're four different decision makers, right? But they all collectively agree, we have a bottom line and we're disappointed that I thought those guys were going to come higher. Their number that they're hoping to achieve at a floor is 1.55, with aspirations up to 1.6. If you guys were to resubmit, you guys will get it. If we don't open escrow with you guys, we'll end up doing a best in final. But I'll tell you, they care about the neighborhood. If they come up, it's in the bag. For example, there's an agent who I really like and trust who is showing today that is like, hey, did you accept? Did you accept? They could also come up and meet you guys and Scott guys would get it, but at 1.5, that's not the case. I'm going to go fishing Kainapoint right now. I don't know, probably not, but I think, hey, I'm going to have spotty reception for a couple of hours, but FYI, I finally spoke to their agent. I believe they are going to come up. We'll be waiting for a resubmission this afternoon. They caught somebody. I mean, if you show up in a Jeep rental, like you already know, come on guys. You already know. The LNR. I said, oh, you guys go. I'm going to let them out too. And then she said, no, we're actually escorting them out. Oh, she was like, they don't have their permits. Really? Yeah. So she believe you. See, I'm going to get that purple sticker. Call me the cameraman. Get the shot of Kenji in the truck. Side note, I was, I wanted to buy a truck. I was like, man, I told Kenji, this is like a year ago, almost to the day. I have truck fever, but I want to, I just, I don't want to spend money on a truck. And he goes, oh, for real. It was like the first time he drove his truck to my house and he didn't tell me that that amazing truck on the street was his. Now coming here, I got to lift my truck and put 33s. All terrains. I might go full mud tire. What, got it? Bing. Yeah. So you got this. That's perfect. We'll try to eat that first. What the whole thing? Nah, we'll cut them. Oh, I was like. Look, that's, I just put strip like this. Oh yeah. That's another thing in Florida. I know I said this two times, but you can go to a bait shop. Oh yeah. Live crab. Live minnows. Live shrimp. Over here. What? You can get live taco. It's from divers. Yeah. That's a little of that kind of stuff. So three lines out. Is that? Oh, no. Oh, it look like. It look like. Something nibbled though, for sure. I think so, you know. No, no, no. Cotton Wahoo. You know what? We're going to throw a Hail Mary. Bait casting wasn't working for us. So I figured we'd switch it up. But first, the main reason you're watching this video. All right, guys. I want to go over some seller tips. Let's talk about first when properties go over asking. The thing is, is asking is a relative thing. If I want to sell a house for 2 million and I know that the best way to squeeze all the juice out of this listing is to underprice it, which is like putting blood in the water and cause a feeding frenzy of multiple competing offers than I priced at home lower than I intend to be. So if I price it at 1.8, when I know we're probably going to get around to 2 million, it went over asking the assumption behind that comment of things going over asking or under asking is that the agent tried to hit a specific mark that is the sweet spot of where this home could sell. That leads into the conversation of how should you price home. So I already mentioned that a really hot commodity. So like a really beautiful home has a pool, cul-de-sac, big yard, amazing two-tone wooden fence for a bedroom and a neighborhood that's largely three bedroom, larger square footage than most bedroom on the first floor. All of these things and renovated and the yard is manicured and it's beautiful. It has the curb appeal. The school district's a 10 out of 10 or 9 out of 10 on greatschools.com. These sort of situations, things go over asking because generally agents underprice the home knowing that if they try and hit the final destination, they may end up without the competing offers that you need to anchor and cause the fear and respect with the primary offer. You want competing offers. So that kind of home, we underprice it to oversell it. Let's talk about an entirely unique home, a unique home, not a cookie cutter. So we're not talking about a subdivision where there's one or two or three models and they're all the same. And if you've been in your house, you've been in 30% of the houses in the neighborhood because everyone got the same layout and we just know, yeah, maybe ones that have an extra parking sell for a little more, but we pretty much know how those sell. What about something entirely unique in a neighborhood of custom built homes or just really old homes? So some of them started out at a thousand square foot. Some of them are now 3000 square foot after having been added on over the years. One of the only homes in the neighborhood that has a view, I can think of this area called Haiku Park in Kaneohe. A loyal gardener used to live in, this is a Hawaii musician, used to live in this cul-de-sac and there's these two homes in that neighborhood that it would be hard to price them. It'd be hard to know what they could go for because they're the only two homes with a multiple hundred thousand dollar view. I sold a home in Hawaii Kai that was at the end. Not quite cul-de-sac, but just end of the road, had a pool, it was old and outdated, but also had a pool, was golf course fronting, but also got a dry shrub in front of it. A buyer could view this home as, wow, this home has the potential that no other home has around here. That home sold for more than I thought it was going to and if we didn't price it up where we priced it, it would have never happened. What about agriculture land that you can put a house on that's entirely unique because it's ag land. It's kind of out in the middle of nowhere. There aren't comps for it. You're kind of really setting the market for it, right? An appraiser is not going to be able to just, like AI or Zestiment, which is sometimes more bogus than not. You're not going to be able to come up with a final valuation. It's just kind of what is someone willing to pay for it? Think of a farm out in the middle of nowhere between Tennessee and Mississippi and Alabama. It's hard to comp these things. So what is it worth? Well, what someone will pay for it? How long does it take to sell these homes? Well, it might sell in the first two weeks. It might take two years. There are properties like that. That property? I want to shoot higher. If my seller is content at $2 million and we price it at $2 million and we stand fast, we hold strong at $2 million, but if they're like, Derek, you can price it at $2 million, but if we don't get $2, $2.5, we're out. Our family dynamic is such, we need this number. I want to price it at that number or higher to begin with. The buyer is unique. Is this buyer coming from the mainland? Are they going to be coming from Big Island? Is it a corporation that's going to buy this property? Entirely unique situations that could take months, if not years, to sell. Can't get priced the way that something gets priced when you know it's going to sell in the first weekend. I'm kind of leading into the next type of home. How do we price a cookie cutter home? There's nothing unique about it. If ours isn't in the perfect condition, then something else is going to come on the market that's in average condition tomorrow. You're in a neighborhood that sells a lot. Higher turnover. These aren't legacy homes. We're not at legacy pricing. Let's say $800,000 in Ewa Beach. Different reason why you shouldn't overprice the cookie cutter entry-level single family home or the cookie cutter townhome is because, well, one, in order to come up with prices that make no sense, there has to be emotion involved, like, oh, this yard, this street, this neighborhood. The cookie cutter entry-level home doesn't have that. Maybe if it's well renovated, but that leads me to my second point. It's a commodity. There's nothing special about it, and the people typically buying the cookie cutter lower-priced real estate, they either don't have or aren't willing to bring in an excessive amount of cash to make up for a price that makes no sense. So if it's a VA loan and the VA lending can only get $800,000 because it only appraises for $800,000, would it get $850,000? There had to have been some kind of emotion and need and FOMO and excitement, probably not happening as likely in that situation, but even if it did, where's the money going to come from? Because that veteran is going to have to bring $50,000 extra in cash. So it's a conventional loan, $800,000, $160,000 down, plus closing costs, we're at $170,000 something. Still, if they offer $850,000 and it doesn't appraise at $850,000, that person's coming up with nearly $50,000 extra in cash. Who's going to do that for a home that they don't plan to stay in forever? This is the basic, small, 1,200 square foot. That's not the type of home that people do that for. So the reason why we don't want to overprice that home is one, we're probably not going to get it. There's nothing unique to spark that emotion. And two, as a seller, you don't want to get caught on the way down. If $800,000 is your mark, you want to price appropriately and hit your mark. If we could be on the upwards, we price at $790,000, get $800,000, $805,000, small margins within that under-pricing game, but we want to price it around $800,000 where your home deserves to be because there's a chance we get competing offers, but there's also a chance it takes weeks and months to sell the home. And in this day and age, in 2024, we just had 2021 a few years ago, and people think homes sell the first weekend. Homes sell the first weekend. They sell the first weekend. What did we do wrong? Is the agent bad? Did they not do a good job marketing? Are we not priced right? Not every home sells in the first weekend, and if we're in a cookie cutter commodity home in an entry-level neighborhood, in a suburb where there's tons of houses and tons of real estate, tons of inventory, a lot of competition, we don't want to overprice that home because we don't want to be on the descent. In 2024, which we're in right now, asking for credits and buyer closing costs and 2-1 buy-downs and these sorts of things are common. You start too high and experience price reduction, price reduction, price reduction. On the way down, as a buyer's agent, I can tell you, talk to Aiden, talk to Mahe, talk to Kenny, talk to our team. They'll tell you, well, we smell blood. We see them limping. We're in the middle of nature and that animal's hurt. It's bleeding and it's injured, and we can go in and safely get that home for $780 or $85 or whatever the case may be. I'd rather be at $800 for four weeks and never have done a price reduction than be at $830 and then came to $820 and then $810 and then $800, and now we're sitting at $800 in the fourth week. So you don't want to get caught on the way down. In sales, in real estate sales, we have all of these scripts that these real estate sales gurus teach. Well, they want to overprice the listing. This is how we get them to sign the dotted line, and later we use our sales skills, not on the market, on the buyers, on everyone out there that we're competing with or cooperating with. We use our sales skills on our actual client, on our seller, to get them down to reality. My team, we prefer not to be in situations where we have to even feel like we're kind of lying to you or bending the truth so that you'll sign the document and we'll get the sale completed. With all due respect, we sold 75 homes last year with just four agents in a market like Hawaii. Like, we'll be okay without this gross relationship that starts with, you know, overly selling a situation. Bait casting wasn't working, so I figured we'd move over to these flats where we could actually see the fish. So we're sight fishing at this point. We're using a floater rig, a little bit different setup, because we do want to show you some fish from Hawaii, catching-release style. Side note, do not do what Derek's doing here, walking on rocks with no shoes. Very dangerous. Gave him my Crocs here, and maybe that was a good look, because... Hee-hee-hee-hee! What is that? A little hina? Ha-ha-ha! Yeah! I caught bait. This one they call Christmas tree fish, huh? Christmas wrasse. Christmas. Yeah. Sometimes the fish decide when they want to go back. Whoa. Here, I'm going to walk out a little bit to try and target the deeper pockets. I lost my bait a few times, and on my way back, I picked up some limu. What is that? Limu. This isn't the right kind of limu. You're going to hit limu? I knew I would. That's not the one. That's not really the one? All right, just going to try it. The limu didn't work. The ika didn't work. But the shrimp did the job. Hee-hee-hee-hee! Another bait fish. Ho'opaa. Or rockfish. Yeah, as you say, rockfish, not poisonous kind. What's that? Nope, not poisonous kind. No, no, not poisonous. Hold him out close to the camera. Oh, yeah, yeah, yeah. Make him big. Oh! Fun kind, yeah? I mean, yeah. Just to be out here is better than being in an office. So there you have it. Fishing, but not really catching. That's kind of par for the course, but we had a good time. And if you saw this video, then you know we've got to take aid in fishing next. So stay tuned for that. Summary, two brothers, two small bait fish. Catch and release. And a whole lot of good vibes that you can only get when you're on the shore. Let's end on this point. Well, Derek, are you telling me it's your way or the highway? If we don't listen to your pricing style and opinion, we wouldn't be a good fit to work with each other? That we have to do it your way? That's not what I'm saying. What I am saying is we have to have a respectful relationship with open dialogue. Weigh pros and cons. Risk to benefit. Analysis. Percentage. What do you think the chances of us getting two million on this one are, Derek? I think there's a decent chance. These buyers are at 1.93 and they've expressed they really like it. Their mom lives down the street. Their mom's willing to help with down payment. We can probably squeeze more out of it. But Mr. and Mrs. Seller, you realize they're the only offer, right? We don't even have competing offers. I've made mistakes in the past for you so that you don't have to make them now. I've pushed a deal so hard that it's broken. I've pushed a buyer so hard that best buyer walked away. And we had to go to the second buyer, which was just not as good of a choice. So can we counter the 1.93 to 2 million, Derek? We can. But I'm not going to act like it's an entirely risk-free situation. I'm going to talk to you about my dialogue with their agent and that conversation at the open house with the clients. And we're just going to talk about the risk to benefit analysis, right? Now I'm talking about intra-offer negotiations. Well, Derek, can we price the home higher? I know that logic tells you it's only worth X. This home, 1.7 million. You just can't see a reason why it would be worth $1,850,000. There are enough comps that are somewhat similar enough in this rather unique neighborhood. It's Hawaii Kai. It's Kailua. You can come up with a price opinion. You're just not getting to where I am as Mrs. Seller. Should we still work together? Should I go look for someone who believes in my vision? What I'm going to tell you, Mrs. Seller, is the other agent that believes in your vision, they're very likely lying to you to get the sale. Sorry, not sorry. In my hypothetical situation, now is there a chance that I'm just missing and I don't see the 1.85? Sure, supposedly. But if 10 agents are saying 1.7 and one says, yeah, I see the 1,850,000, chances are they just want the dotted line. They're happy to have an open house. Give it a go and be there when you come to reality. I would rather not have that an unsaid thing. I'd rather talk like this. Hey, Mrs. YouTube Seller, who's going to go to coreteamhawaii.com, go to the bottom, fill out the contact form and reach out to us and say, hey, I want to talk to Derek about a price analysis. Hey, Mrs. YouTube Seller, I think we're at 1.7. I can see a world where we go like 1.75. Look at my data that I put. Look at what I'm deriving this from and tell me if you actually see 1.85 in the data. I know that's where you want to be. Tell me if you see it. No, Derek, but you know, the way the sun hits those houses, don't hit my house. We don't get as hot in the afternoon and, you know, we get mango trees. We tell you, you don't like mango, Derek. Mrs. Seller, I understand you have less afternoon heat and your mangoes are really good. I still don't see 1.85, but I have my floor. There's no reason we should sell for less than 1.7. It's possible we can get 1.75. And am I willing to have my upper level aspiration at 1.85 with you? Yes. How do you feel about me trying to get you 1.85? But if we miss the market, we can't get it. If the market is just not speaking to us at 1.85, are you, one, willing to price at 1.85 and just be on the market for the next year? Are you that patient and that committed? Is that your situation? You know, are you retiring? Is your kid going to college? Are you divorcing? Like, what are the reasons why you need 1.85, want 1.85? And do you really have the tolerance and the patience to wait it out? Because, yeah, maybe we get it if we wait a year. Or if we price more in the 1.7 range, we hope to get competing offers, we hope to drive it up and get the emotion, get the competition to get us north of 1.8, would you be okay with an outcome that tried to get north of 1.8 but really is priced with a floor closer to what the data shows? No. Okay. If we price it 1.85, but you need to get this thing done within two months. You agree, right? We price it 1.85. Let's talk about how we're going to do price reductions, the way we're going to communicate, you're going to treat me, I'm going to be honest and hardworking for you. And are we going to have a good, positive, professional relationship that allows the truth to be spoken and to be pragmatic and objective and data-driven? Can we try and you not be mad at me if we don't hit it? Because I'm not going to sit here today and promise you 1.85. I can find you agents that will, but I'm not going to do that. I'm going to be more honest with you, more skilled for you. There's two times in my sales history where I just really thought it was going to go lower and we went higher than I just could not make sense of it, and we did. It's happened to me twice in 200 and something home sales. Depending on how that conversation goes, we decide whether or not we're fit to work together. Hey, here's the thing. I want us to talk. If you're like, Derek, brother, I was hoping you saw my vision at 1.85, but I'm just not comfortable going with you unless you're just stoked, man. If you're not bought into the vision, I feel like we're not on the wavelength together, and I just don't feel like we're a fit. I could find you the agent who just will be bought in and is a good fit, and I will refer them to you. Not that I'm so good that I don't need business, but I'd rather respect you, respect your wishes, and get you to the right agent who's the right fit, even on this island. You're one of my competitors. That's a little monologue about how the listing process goes, about how price opinions for unique, amazing, legacy, crown jewel homes, cookie-cutter, nothing special, entry-level homes. A unique home that's kind of a funky one. Who knows what this thing will sell for? And then intra-escrow negotiations. Should we count, or should we step on their throat? Well, it depends. How much backup do we have? Do we have 10 offers waiting? We have no offers waiting. Should we count and respect the offer we haven't had? And finally, pre-listing. When we're coming up with a valuation for your home, what I can say is we're incredibly skilled, we're incredibly nuanced, and we're going to be honest with you. We're going to give you three prices. Shouldn't sell for less than this. This is probably upper end. And then we have an aspirational number. We know that every seller wants to hear, like, pie in the sky. What could we hit if we really knock this thing out of the park? And I want to talk about that. Because if I were selling my home, I'd want to hear that the agent at least thinks that there's, you know. You ever seen the movie where they're like, so you're saying there's a chance? Like if you're the last person on Earth, right? I want to know that the agent, like, there's some possibility that someone will come and buy this house for here. But let's be realistic and talk about strategy in the real world. We give you three prices. We're very skilled, educated, nuanced. We're always looking out for your best interest. And even if that means getting you to one of my competitors, I'll do that for you. Name me another person who will say that to the world here on this platform. No one, because no one can get on this channel and sell your house. Go to courtteamhawaii.com, reach out to us. Don't be shy. Look at me. I smell like squid. We're fishing. We're just normal people. Reach out to us. Go to courtteamhawaii.com. See you on the next one.