If you have ever sat down with a homeowner and tried to convince them that their house is not worth what they think it is, you probably understand that homeowners are not the most realistic people in the world – especially homeowners in distress.  One of the most frustrating parts of being a Real Estate Investor is dealing with unrealistic sellers who refuse to believe that their house is not worth what they think it is.

This is frustrating enough in a normal market.  In a normal market your job is just to get the seller to realize that their house might not have appreciated as much as they think.  In a tumultuous buyer’s market like most of the country is facing now, we face a much harder challenge.  In this market we are faced with the task of convincing people not only that their home has not appreciated, but that it has most likely depreciated significantly.

Even as sellers see the news reports that prices are falling precipitously all over the country, they stubbornly think “Yeah, but not my house.  My house is different.”  People see their neighbors being forced to sell their homes at big discounts, and but they refuse to see that the value of their house might have dropped too.  Homeowners tend to think that their house is different and special – that their house is impervious to market conditions.  You can come at them with all of the sales charts, statistics, and comps that you’ve got that show prices taking a dive and inventory skyrocketing, but they still tend to think that their house has either stayed the same, or might even have appreciated a little bit.  It can be even harder in the markets that have been hit especially hard.  In those markets, even if a neighbor sold their house at a loss three months ago it still might not be a valid comp because prices have fallen even more.

When faced with the facts that the market has crashed, homeowners will cling to some pretty ridiculous reasons to explain why they think their house is still worth more.  One homeowner I met with had a refinance appraisal done three months prior that came in at $540,000.  The home was clearly worth no more than $430,000.  The appraiser either had no clue what they were doing, or they were acting maliciously.  I asked to see a copy of the appraisal, and I immediately spotted some errors.  The home was 15 years old, but the appraiser had taken comps from a much nicer, brand new neighborhood over a mile away.  The home was 3,200 sf, but the appraiser used homes that were up to 4,300 sf as comps.  It ignored that fact that the house three doors down, which had almost exactly the same square footage, lot size, and floor plan, had sold four months earlier for $425,000.  Four other homes had sold in the neighborhood in the previous six months for under $450,000 and not one home had sold for over $500,000 in the previous year.  When I asked them why, even when faced with all of this evidence to the contrary, they still believed that their home was worth every penny of that $540,000 appraisal, their response – “we have a generator and storm shutters.”

Real Estate Agents across the country are reporting an increase in denial over the price of sellers’ homes.  Just read this article from MSNBC.

So what is the bright side to all of this?  When you follow The Agent Magnet system, you don’t have to spend another minute trying to convince a seller that their house is not worth what they think it is.  With The Agent Magnet, the Agents do all of the convincing for you.  They weed through the unrealistic sellers in denial and deliver the cream of the crop to you in the form of cooperative, motivated sellers.

When you are running your own business, you need to learn the power of leverage.  Spend your time doing only what you love and makes you money, and find someone else to do the rest.  If you are answering the phones, putting up the signs, painting the houses, mowing the lawns, writing the letters, and negotiating all of your own short sales, you are going to be burnt out and out of business before you know it.  There are service providers out there who can handle just about everything else, and The Agent Magnet has provided at long last a way to outsource the most frustrating part of the entire Real Estate Investment business – dealing with unrealistic, unmotivated sellers.

Enjoy all your new free time!