You’ve heard it many times. “Your competitor’s homes are less expensive.”
This reminds me of my mother’s response to the whine that everyone else was able to do what I was asking of her. “If Jimmy jumped off a cliff, would you do the same?”
New home sales can carry the same “follow me” course, if you allow yourself to be a follower instead of a leader.
When your prospective buyer says, “Your competitor is discounting his homes by $20,000”, lob this one back. “Why do you suppose he is so willing to cut his price? That seems to be a price apology.”
Let your buyer ponder a moment. He might reply with, “Well, he’s having trouble selling homes in this market.”
And your response should be, “Why do you think that is?”
“No one is buying,” he says.
“Or, more accurately, no one is buying from him,” you counter. “And why do you suppose that is?”
Perhaps the other builder has a lesser location, fewer amenities, cheaper materials, smaller homes, or some other reason that justifies a price reduction. Plant that seed in the buyer’s mind that he might be getting less value with that lower price—and remain firm in the exceptional value that you are offering.
Secondly, you can equate that price difference to a more relevant figure. A $20,000 difference, over 30 years, equates to $4.67 per day—about the cost of a cup of coffee. Doesn’t that seem like a small price to pay for the added home value you’re offering?
Above all, listen to your mother and don’t go jumping off that cliff.
