7 Strategies | Short on Inventory? Try This.

Check out these strategies for building more listing inventory. Are you experiencing a listing inventory shortage? Most markets around the country are out of balance, with more buyers than sellers. In some markets, the shortage has led to multiple offers and near panic by both buyers and real estate professionals. As a leader, what are your strategies to help your people? Here are seven strategies that have helped us find and create inventory in this market.

1. Look under the bridge.

With today’s computer searches, most real estate professionals (and buyers) search in $25,000 to $100,000 increments. For example, they look for a house priced between $250,000 and $300,000 or from $300,000 to $350,000. In this case, the pricing bridge is $300,000. A house priced at $300,000 will catch both searches and receives 28 percent more showings than a house priced just under the bridge at $299,000. Many real estate professionals still price with a retail mindset at $299,000 or $299,500 rather than a computer search mindset. A study in our market showed that 12 to 24 percent of all homes were priced right under the bridge. Want to find more inventory? Look under the bridge.

2. Drive until you qualify or until you find it.

Inventory tends to be the shortest in the core areas. Buyers (and real estate professionals) who are willing to drive to the outlying areas may find more inventory at lower prices.

3. Hold a modern open house.

What do we mean by a modern open house? This is the new, Internet-prompted open house. Here’s the buying pattern: approximately 90 percent of buyers search online. If they see something they like, about 74 percent will drive by it. If they like the neighborhood and the outside, then 63 percent will find a way to go inside. Their preferred method? An open house. These open house visitors are self-pre-qualified via the Internet and a drive by. Sixty-five percent of them have a house to sell. Hold open houses to find sellers as well as buyers.

4. Contact out-of-town owners.

During the great recession, many sellers couldn’t sell but had to move on with their lives, thus leaving their houses behind. They rented their houses and moved to a new area. Target a neighborhood and work with a title company to help identify the out-of-town owners. There is often a difference in the property address and where the tax notice is mailed. Develop a postcard-mailing program to these owners.

5. Focus on new construction.

During the great recession, there was virtually no new construction, so we got out of the habit of selling it. Refocus on this area as the builders start a comeback. 6. Build hot and warm Lists. Help your people develop hot and warm lists. Hot lists are people who want to buy or sell within the next 90 days. Warm lists are people who want to buy or sell within the next year, but may not know they want to buy or sell. (You know they want to buy/sell because you’re observing the changes in their lives, such as divorce, empty nest, etc.) Encourage your people to share their lists. These hot/warm lists become an alternative MLS and a great source of listings.

6. Build hot and warm lists.

Help your people develop hot and warm lists. Hot lists are people who want to buy or sell within the next 90 days. Warm lists are people who want to buy or sell within the next year, but may not know they want to buy or sell. (You know they want to buy/sell because you’re observing the changes in their lives, such as divorce, empty nest, etc.) Encourage your people to share their lists. These hot/warm lists become an alternative MLS and a great source of listings.

7. Bump up your real estate reviews.

Help your team develop an annual real estate review or check-up program for all your clients. Just as clients meet with their accountants or doctors once a year, offer them the opportunity to sit down and evaluate their real estate holdings. This is not a disguised listing appointment. It is a service that you provide. An evaluation of real estate review conducted by those real estate professionals in the Ninja Selling coaching program in 2014 showed that a listing, sale, or referral resulted 43 percent of the time when they had a face-to-face review with clients. Help your team follow these seven strategies, and you will find and create more inventory. The result for our firm has been to outperform the market on listings each of the past three years. With the listings dropping by double-digit percentages each year in our market, we’ve been able to increase or maintain our listing inventory each year using these strategies. As we say in Ninja Selling, T.S.W.—This Stuff Works!

Written by Larry Kendall, chairman emeritus of The Group, Inc. and author of Ninja Selling. This article originally appears in the April 2015 issue of the REAL Trends Newsletter and is reprinted with permission of REAL Trends Inc. Copyright 2015. 

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