How do I convince flippers to list their homes reasonably?
Background: I am a real estate agent who runs a flat rate listing company, meaning I make the same amount no matter how much houses sell for. For that reason I don't mind necessarily care if houses sit on market forever, but they are losing tens of thousands of dollars over and over and over again and its sad.
How do I get flippers to list their homes for reasonable prices? I have listed probably 40 or so flips over the last few years as an agent. Obviously I'm just getting started, but I want to hear from both flippers and agents as to why I cannot convince flippers to list their homes for reasonable prices? I've got 12 comps all adjusted for upgrades, overall market analysis, detailed zip code analysis, exact model matches, recent flips, let's say all that data suggests a list price of $425,000, inevitably 90% of my clients want to list at $475,000 "just to see". The wholesalers ARV estimate is $430, my CMA is $425, we have 3 different ways to analyze the property all arriving at price between $420,000 -$440,000.
This is not once or twice for me, but upwards of 30 houses sitting on the market for months, most of the time in the hottest real estate market in the history of the U.S. After 60-90 days, multiple price reductions, and extra $10-12k in holding costs, house closes for lets say $419,000. 90% chance we could have gotten multiple offers and sold for around $435,000 if we listed at $425,000.
All said and done I still make my money, but the flippers are losing (and I actually calculated the average) around $12,500 per flip by doing this. What am I doing wrong? As a flipper what can I tell you to convince you that numbers don't lie? The market is shifting and it's more important than ever to list reasonably and I had 2 more flips in the last week listing 10% above all comps. I have very detailed analyses. Both these clients are experienced flippers, one has sold 3 houses, the other about 5 (all 5 with me and my CMA was within 1% 4/5 times, and every time they insist on listing 10% too high)