Section 1 quiz Flashcards
(21 cards)
Which of the following methods is a correct way to value property?
- None of these answers are correct.
- Add the original cost of improvements to the market value.
- Add the real estate commission and selling costs to the asking price.
- Add the value of the house to the value of the lot for a total asking price.
- None of the answers are correct
Buyers compare the seller’s property and asking price to other properties
Most sellers see their property as….
- below average
- above average
- average
- above average
Studies have shown that most people have a strong tendency to see themselves and their things as being above average.
Which of the following is a problem with a seller overpricing their home because they want to take their time selling it?
- the best chance of receiving the highest possible price is to sell during that “golden moment” when is a fresh listing
- the seller most likely will change their mind before the property is actually sold.
- the buyer will only make offers if the seller offers bonuses.
- the best chance of receiving the highest possible price is to sell during that “golden moment” when it is a fresh listing.
Overpricing will…..
- ALWAYS damage your relationship with your client
- NEVER produce a sale
- needlessly prolong the marketing time
- needlessly prolong the marketing time
No matter how much money and time is spent on advertising and promoting the property.
“Seller-centric” pricing is:
- sellers going over the facts with a “microscope.”
- a playground game
- the seller’s price opinion being affected by subjective biases
- the seller’s price opinion being affected by subjective biases
The best possible chance for a seller to receive the highest price is….
- to raise the asking price as high as possible
- to put the house on eBay
- to hire multiple listing companies
- to sell when it is a new listing
- to sell when it is a new listing
Aggressive and competitive pricing should be the beginning strategy, because buyer bargaining positions generally improve as time wears on and the listing ages.
Which of the following is often at the heart of overpricing?
- the seller’s optimism
- the seller’s image
- the seller’s fear of failure
- the seller’s optimism
The most indispensable piece of information an agent can learn from a seller is:
- where they are moving
- what price range they think is right
- when they purchased the house
- what kind of advertising they want
- what price range they think is right.
Yes, it is the single most important question because it has the greatest bearing on marketability.
True or False:
The seller controls price, product, and terms.
True
SEllers control the most powerful levers that affect marketability.
What do sellers often misunderstand?
- The reason for wanting to sell
- The theory and mechanics of pricing
- The right to price their own property
2.The theory and mechanics of pricing
Which of the following is a way that sellers use to justify unrealistic asking prices?
- Objective overview
- Subjective bias
- Price projection
- Subjective bias
Sellers sometimes invest their own self-importance into the property.
Which of the following is NOT a source of bad advice?
- Competing agents who may be attempting to “buy the listing” by suggesting an unrealistic price.
- The seller’s children, who love the old family home.
- The Comparative Market Anaysis
- The Comparative Market Anaysis
Yes, the market predicts buyer behavior by looking through the buyer’s eyes to compare the subject to other available and sold properties.
One reason sellers overprice their property is:
- defect denial
- objective anaysis
- good advice
- defect denial
Yes, sellers become accustomed to things that hamper the enjoyment or quality of a property.
Which of the following is an example of an open-ended question?
- “Which real estate services are important to you?”
- “Would you like to price your house at $500,000 or at $495,000?”
- “Do you think a buyer would pay that much ore because you re-roofed the house?”
- “Which real estate services are important to you?”
yes, this question seeks information.
True or False:
Correcting defects resulting from deferred maintenance will always add value to the property.
False
No, the seller might be simply neutralizing a negative impact on price caused by obsolescence or neglect.
True or False:
When comparing existing homes (3+ years old), the cost approach adds or subtracts today’s replacement cost without allowing for depreciation.
False
No, it should allow for depreciation
Who determines what a property will eventually sell for?
- The seller
- The buyer
- The buyer’s friends
- The buyer
One of the ground rules for pricing discussions is that conclusions should be:
- drawn from your claim of professional infallability
- drawn from facts
- drawn from seller assumptions
- drawn from facts
Yes, and this requires a well-constucted, comprehensive, and professional market analysis.
In pricing discussions, the agent should…..
- defend the seller’s unrealistic reasons for overpricing
- should not apologize for disppointing facts
- skip over any negative aspects of the property
- agree with the seller and sort out any misconceptions later
- should not apologize for disappointing facts
The agent does not create market realities, but he or she must convey those realities to the seller.
When working with sellers, as a real estate agent, you should…
- make sure sellers understand that you are helping them achieve their goals.
- ALWAYS apologize for disappointing facts.
- ALWAYS defend your position
- make sure the sellers understand that you are helping them acheive their goals.
True or False:
Adding or subtracting the differences between subject and sold comparables prices will help you determine the subject property’s best asking price.
True
Correct, differences must be adjusted.
