What to Do If A Client Says, "I'm NOT Selling My Home for THAT Price!"
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| Image by Kim from Pixabay. |
Curb appeal – check
Staged to a neutral palette and decluttered – check
Priced competitively according to the most recent home sales/comps – check
So why – in such a competitive housing market – is this homeowner being lowballed?
Getting Lowballed Despite a Competitive Market
One elephant in the room when it comes to being lowballed while selling a home: unfair housing practices.
Yes, we have fair housing laws now, with the most monumental beginning in 1968, spurred by the Rev. Dr. Martin Luther King's tragic assassination.
However, laws are not "Disney magic". In other words, laws did not instantly mean all violations would stop.
The misbelief that laws stop violations is the biggest myth that I consistently have to dispel with both those in the industry and everyday community members.
To explain this common misconception (that no one should feel shame over), I like to reference how, Dateline and True Crime podcasts show that although kidnapping, murder, and other crimes have BEEN illegal, they still happen. Laws simply mean that IF someone is caught and IF there is enough evidence, that person may POSSIBLY face some sort of penalty. It is no different for illegal, unfair housing practices.
In short, unfair housing still happens and/or may be a threat (just three – of many – cases in point: this, this and this).
Thus, we would be wise to have "The Talk" fair housing edition to ensure homeowners sell. I know many think of the "birds and the bees" when we say "The Talk", but there is another talk that is key for (what I call) being a Fair Housing D.E.C.O.D.E.R. (with decoder being an acronym to “advocate not alienate”).
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Why The Talk” Matters: We can acknowledge the problem AND ensure people it does not happen on our watch
I was intrigued by and grateful for this comment left on a prior article I wrote for HousingWire – my empathy (the “E” of the DECODER acronym) kicked in so please hear me out.
John Baldwin
How areyou concluding that past discrimination by the federal government, lenders and real estate agents is the fault of current real estate appraisers? We are hired to provide an unbiased opinion of current market value for a given property in irs market area. We can’t ignore sales in the same market because of past discrimination. And we don’t care who may occupy the property. We are getting sick and tired of being wrongfully accused of bias when we are just doing our job.
I want to highlight a few phrases that this commenter left that may resonate with many in our industry – myself included:
– “fault of current…”
– “We are getting sick and tired of being wrongfully accused of bias when we are just doing our job”
Let’s address these specifically, as well as his full comment.
First, let’s review current data to support how unfair housing did not disappear with a seemingly “bibbidi boppity boo” from the legislative pen. Sadly, it still happens (frankly, once is too often).
Here's data showing that although homes should be appraising for more over the last few years due to how quickly the market has appreciated, some sellers may be lowballed based on a protected class.
Plus, here are some first-hand accounts.
As a nerdy author, I always link to the data if you have time to review the datasets but I know sometimes the raw data is skipped due to it often being too technical. This is why I try to simultaneously share personal stories, especially by video, like the link above.
Although unfair housing is likely NOT a practice of every appraiser by any stretch to the commenter's point, it is still imperative to have “The Talk” to raise awareness and community members’s savviness.
Again, it is no different than how most of us approach True Crime podcasts. The stories are often heinous crimes that may never happen to the listener but we are better off for having our awareness raised about things like:
Not buying a beverage while alone at a pub,
leaving it uncovered while in the restroom,
and then returning to drink it.
It should not take us personally being slipped a roofie or some other drug to be aware that this can happen and that we need to take precautions (this man said it recently happened to him).
Proactive awareness-raising is preparation and preparation is never lost time.
Essentially, they are cautionary tales that we would be wise to heed without going through the “school of hard knocks” (a.k.a. firsthand experience).
The same is true with most violations, including unfair housing.
Thus, instead of personalizing the issues that have been documented – that we have had no part in – and being disheartened, I want to encourage us to be proactive change agents (what I call a Fair Housing DECODER).
If you have not participated in unfair housing, then you are not guilty or at fault for past episodes. PERIOD.
Yet, the broader point of fair housing advocacy is that we ALL have a responsibility going forward to ensure everyone has equal access and opportunity.
Back to our pub example. You notice someone goes to the restroom and then another person tampers with her drink. You are not at fault for the drink being tampered with but you may sense an ethical responsibility to at the least mention it to the person once she takes her seat, you may tell the bartender, or you may even boldly question the person tampering with the drink. In a nutshell, we share a collective responsibility even when we are not at fault.
In short, we can affirm to clients, “This IS an issue, but / don’t do it and here’s how I want you to stay on guard”.
Essentially, we can acknowledge the problem AND ensure people it does not happen on our watch. Interestingly, that becomes a key tenet of business growth (that the community knows, likes, and trusts you). Thus, proactive awareness raising is a key marketing and business growth strategy and an advocacy strategy – a win-win. Booyah!
Be a Fair Housing DECODER
First step, sellers should know how much the homes in their area are going (ask your real estate pro for the most recent home sales a.k.a. "the comps").
Secondly and unfortunately, "staging" a home for an appraisal, may mean having a person of an opposite protected class being a stand-in for the actual homeowner. Of course, staging a home should only entail neutralizing the property, not the people who own it! However, since the 1940s and 1950s, often the only way that unfair housing (and lending, including lowballed appraisals) can be determined is if testers (similar to secret shoppers) of a differing protected class step in and pretend to be the homeowner.
For example, from the fair housing version of "The Talk”, point number two can stop a seller from selling dead in her tracks.
"Of course, staging a home should only entail neutralizing the property, not the people who own it! But, lowballed RE appraisals are often revealed when a “secret shopper“ of an opposite protected class covers for the homeowner (e.g. Christian vs. Muslim, White vs. Black, Able-bodied vs. Disabled, Male vs. Female, Single vs. Single with Kids, etc.) --> keep receipts + know area comps"
Fair Housing Testers are currently sent out annually by local fair housing agencies to detect unfair housing (but many offices need volunteers). Laws did not stop the need to uncover discrimination, but laws provide a level of remedy if exposed. Such knowledge is only power for clients.
Thirdly, don't just let your "spidey senses" tingle. Go with your intuition and document and report any instances of unfair housing. Often, the reason unfair housing can continue unchecked is because it is typically not reported. The National Fair Housing Alliance has estimated that although there are upwards of 30,000 reports of housing discrimination annually, that is likely only one percent of actual fair housing violations, yeesh!
If you are not sure if your "spidey senses" are on point and need a consult before going straight to HUD, start with:
https://nationalfairhousing.org/report-discrimination/
Lee Davenport, Ph.D., is a real estate coach/educator and author (of including Be a Fair Housing D.E.C.O.D.E.R. and How to Profit with Your Personality). Dr. Lee trains real estate agents around the globe on how to work smarter with their unique personalities and how to “advocate, not alienate,” so everyone has access and opportunity in real estate.
Have you ever needed the “Cliff Notes” version of fair housing? Well, move over Spark Notes!
The Starting Point: How to Be a Fair Housing DECODER Guide https://books.bookfunnel.com/learnwithdrlee
It is available to download for a limited time at no fee. Score!
This condensed workbook (based on the nationally acclaimed workshop) offers Dr. Lee's novel concept of being a Fair Housing DECODER© who skillfully and proactively advocates --not alienates-- for equitable access and opportunity in real estate for EVERYONE.
“Interesting approach on the topic of fair housing that I have not seen offered to Realtors.” --Maria, Broker/Owner, REALTOR®
“I have the Realtor GRI designation and they should make this part of that designation. This is THAT good. THANKS, Dr. Lee!” --Michael, Broker/Owner, REALTOR®
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