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Commercial Real Estate Property Owners You Need to Avoid in This Market

By Jim Gillespie | April 28, 2010

When the market was hot several years ago, you could list properties at above-market prices, and the market would often eventually catch up to your listing price. But we’re in a very different market right now in today’s economy, and with this in mind, you only want to be listing properties for sale with owners who will sell at today’s fair market value.

Owners who are real sellers in today’s market have underlying reasons why they really want to sell. They may want to exchange into another property, they may be doing estate planning, they could be going through a divorce or a dissolution of partnership, or they may just want to take the money and run. But in any event, an owner who will only sell if they get an above-market price in today’s market could end up being one of your greatest nightmares.

Before listing a property ask the owner something similar to, "Are you only a seller if you get $1,200,000.00 for the property? Or are you going to sell the property for the best price a buyer will pay you for it in today’s market?"

And if the owner responds by saying something like, "I don’t care if I have to wait 5-10 years to get $1,200,000.00, that’s the price I’m going to sell it for", you may want to just walk away…especially if you think there’s no way of getting anywhere close to that price.

Another good question to ask an owner before listing their property is, "What would happen if you didn’t get the full $1,200,000.00, and you ended up still owning the property 5-10 years from now?"

An owner who has a true underlying reason to sell would respond by saying something like, "That’s not possible. We need to sell the property because…" And that, as a broker, is definitely what you want to be hearing from them.

But again, an owner who’s only a seller if they get an unrealistic price for their property might respond by saying, "Oh, that’s OK. If we still own the property 5-10 years from now that would be just fine with us."

And those owners, in today’s market, are the kind of owners you want to be avoiding.

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You and your office can easily listen to my five-minute audio presentation titled, "Positioning Yourself for Commercial Real Estate Brokerage Success". Dial 1-507-726-3727 to begin listening to the presentation, and if you’d like to play the presentation during one of your company’s sales meetings, just utilize the speakerphone feature to listen to it on the phone inside of your conference room.

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Coldwell Banker Commercial

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