Supply & Demand . . . Liquidity and Innovation

When there’s more supply than Buyer Demand, Prices go down and Buyers are at a negotiating advantage.

The Sellers must get more creative about how they “package” their wares because EVERYONE is clamoring to snag one of those rare and elusive Buyers.

This creates 3 distinct “markets”

Some Sellers have enough depth (equity/liquidity) to dump their pricing to the bottom to “create value” for the Buyers most interested in getting a DEAL. These folks represent a very small segment of the market – Probably less than 5%

Other sellers are INNOVATORS. they’ve mastered the art of standing out in the crowd through differentiation (sometimes RADICAL). They might invent new ways for Buyers to buy THEIRS (Owner financing) . . . or they might get creative with their product to make it “COOL” . . . These folks also represent less than 5% of the market.

The 90% of all Sellers remaining make up most of the inventory that sits there day in/day out, week in/week out, month in/month out, year in/year out.

When the experts analyze the monthly sales statistics, they almost always learn that the 10% (Right pricers and innovators) consummate 90% of the sales

When there’s more demand than supply, prices go UP and SELLERS are at a negotiating advantage.

Guess what?

Still 3 markets . . .

5% of the Buyers have more liquidity (Buying Power) and can move FAST

5% of the Buyers Innovate by finding sweet spots for sellers

the remaining 90% stay in the market and whine about how tough it is to BUY

So . . . What’s the strategy of the 90%ers?

Most have a master plan to stay where they are and let the market come to them . . . and pledge to take action at that perfect moment in time at which supply and demand are in perfect harmony.

The problem with this strategy.

The harmonious balance of supply and demand might last 30 minutes (if that long) . . . and the pendulum swings before they can take action, so they do nothing (again).

In a Seller’s market (Low inventory), there are often multiple offers . . . Several Buyers vying for a single property.

In a Buyer’s market (High Inventory), There are multiple properties for each buyer.

How can you win in ALL markets?

Be one of the 10%ers . . . because what they understand and practice works just as well in both markets.

Liquidity and Innovation create multiple opportunities . . . always.

The irony of this game?

The 90%ers are the little fish

The 10%ers are the BIG fish

And Big fish eat little fish

Just sayin’

Best,

 

b

Published by Barry Owen

Strategist-CEO of Pareto Realty Real estate sales Professional Inviter-Facilitator-Practicer of Open Space Technology Opening safe space for people & organizations to self-organize around issues & opportunities BarryOwen.US Invite-Listen-Love

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