A pinball property, or pinball listing, as it’s also called, can be a real estate agent’s best friend – just as long as they’re not the ones listing the property!
Pinball listings, as the new term has been coined, are unrealistically-priced properties that, because of their high asking prices, are used by competing agents to make their own asking prices more attractive to potential buyers.
Ken Harney, a syndicated columnist who focuses on real estate, referenced a hypothetical that Joe Manausa, the owner-broker Century 21 First Realty in Tallahassee, Fla., has described:
“If two very similar homes are near each other, with one priced at $250,000, and the other at $280,000, the higher-priced home is often shown first. Then the real-estate agent says, ‘If you like this home at $280,000, you are going to love the home down the street at $250,000!”‘
Given how detrimental a “pinball” status can be for your listing, how do you avoid it? We’ve got three suggestions:
- Avoid the Listing Altogether – If the seller refuses to list with a price that’s a better fit for the market, given what the CMA says, don’t take on the listing. It may not be worth your time and effort, especially if the seller is unwilling to negotiate on the price. But if the seller is willing to listen to the facts, then it won’t become a pinball listing with a too-high price.
- Don’t Believe the Hype – There’s a good chance that pinball listings will get lots of traffic with their high price, but remember what we just wrote about agents using the listing to their advantage? It may seem like people are interested in the property, but it actually benefits nearby, lesser-priced residences, so you may want to reevaluate your pricing strategy if you notice that pattern.
- Contractual Obligations – Another agent quoted in Harney’s piece had a good recommendation – take the listing, but bind the seller to a contractual agreement that if the home does not sell in a specified time (two or three weeks is a good measure), the asking price must be automatically reduced.
Even though it sounds fun, this is one case where you do not want to be The Who’s Pinball Wizard.