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You Are The Seller... Which Listing Agent Should You Choose ?

Mr and Ms Home Seller have decided to sell their home. They have a fairly good idea of what they think their home is worth. After doing their own homework online with some of the automated pricing web sites, The Sellers, being very sensible sellers, schedule appointments with three local Listing Agents who've been hanging stuff on their front doorknob for years.

Each Agent comes prepared with a "Competitive Market Analysis" (called a CMA). It is on fancy paper, and two of the three even have "professionally done" flip charts as part of their presentations. Each of the three Listing Agents recommends a specific sales price.

Amazingly, a couple of the Listing Agents have come up with prices that are lower than the Sellers expected. Although they back up their recommendations with recent sales data of comparable homes, The Sellers remain convinced their house is worth more.

When the third Listing Agent arrives, The Sellers find his pricing numbers are much more in line with the Listing Price they had hoped for, or maybe even higher. Suddenly, they are two very happy and very excited home sellers, already counting their money.

Which Listing Agent Should The Sellers Choose ?

If they're like many people, they pick Listing Agent Number Three. They feel that this is an agent who seems willing to listen to their input and work with them. This is an agent who cares about putting the most money in the Seller's pockets. This is an agent who is willing to start out at The Seller's price, and if they need to drop their price later, they can do that easily, right ? After all, everyone else does it.

The truth is... that The Sellers may have just met a Listing Agent using an unfair listing practice called "buying a listing."  He "bought" the listing by suggesting that The Sellers might be able to get a much higher sales price than the other agents CMA's recommended. Most likely, he is quite doubtful that their home will actually sell at that price. The intention from the beginning is to eventually talk The Sellers into lowering their price.

Why do some Listing Agents "buy" listings ?

There are basically two reasons. A well-meaning and hard working agent can feel pressure from homeowners who have an inflated idea of their home's value. On the other hand, there are some agents who engage in this unfair sales practice routinely.

Which makes more sense ?  Which Listing Agent should the Sellers choose ?

It depends on whether The Sellers just want to "list" their home... or if they really want to "sell" their home.

Comment balloon 11 commentsKaren Anne Stone • February 07 2009 11:58PM

Comments

Well said and so true.  It is our challenge to help Sellers understand the ramifications of pricing their home at an inflated price.

Posted by Sharon Parisi, Dallas Homes (United Real Estate Dallas ) over 9 years ago

Karen Anne,

I did a ton of work for a customer who was a referral.  I went and spent 2 hours with these people.  I found them a packing company and called them within 30 minutes of leaving the listing appointment with the information.  I also found a company that would pack carefully some very expensive  collectables, and gave them that information as well.  They had a power of attorney that was not executed correctly.  I took that back to my office, faxed it to two attorney's that I knew (for free) and had the answer back to them about the POA within 2 hours.  I suggested a listing price of $450K.  They wanted $500K...

Guess what, they went with another agent at a price of $459K, which I would have been OK with...and the condo is still not listed.  I explained to them that it could be listed, get the info out there, but could not be sold until the POA was fixed (this was not going to sell in a day, so they had time).

When I called him and told him that the condo still was not on the MLS he told me, yes, she (the other agent) told me we could not use the POA as it was. I said, "I was the first agent you saw and I told you that."  That was a week ago and it is still not listed.

Go figure. 

Done ranting, sorry...the point is...I would go with a realistic agent who is giving me the best advice and not the one "buying the listing".  What's the point?  That property will still be there next year.

Posted by Karen Monsour, REALTOR, SSRS - Sells FL Waterfront, Short Sale Expert! (Coldwell Banker Fort Lauderdale Beach) over 9 years ago

Hi Karen Anne... it sounds like the first couple of agents had factual data to back up their pricing recommendation and that is one element of what any seller should look for in a good agent.  Agents offering pricing recommendations without current data to back it up, even if it is a price the sellers like hearing more, is most likely leading the seller to unrealistic expectations and unhappiness down the road.

Posted by Steve Shatsky over 9 years ago

It sounds like Agent #3 told them what they wanted to hear.  It makes our job tougher since we want to tell the sellers what the reality of the market is but they just don't want to hear it.

We have to use all of our skills to prove our worth to every client.  Sometimes they get and sometimes they never do.  I suspect the seller will have a difficult time selling because they can't come to grips with what the market says their home is worth.

Posted by John Alesi, (Orange County California Real Estate) (Century 21 Award) over 9 years ago

Hi Karen Anne,

I will be putting a condo onto the MLS in the next few days.  The building is new construction (2006) - yet every listing seems to be wildly overpriced when it first goes on the MLS.  The final sales prices are about $50k under almost all intial listing prices.  Yet only THREE condos sold in the entire city of White Plains during the month of January.  It's as if everyone is just letting the seller price it wherever they want to.  I was able to get a listing agreement at a more sane price.   But seriously - units that are selling for about $340,000 - $350,000 are being listed at $399,000.

 

Posted by Ruthmarie Hicks (Keller Williams NY Realty - 120 Bloomingdale Road #101, White Plains NY 10605) over 9 years ago

Hi Karen, with so many homes on the market, it is very important to list the home within the correct range to start, or it will just be eliminated.  There is plenty to show.  And it does not look good to see a stale property with several price reductions - looks like they are ready for another.

Posted by Virginia Hepp - Mesquite NV REALTOR, Mesquite NV Homes and Neighborhoods - Search MLS (ERA - Mesquite NV Homes For Sale) over 9 years ago

This is so often so true. I do a CMA based on a quick turn around and price it accordingly. I dont get paid to list I get paid to sell it!

Posted by Chip Jefferson (Gibbs Realty and Auction Company) over 9 years ago

Karen,

Of course, if I were a seller and did not know anything about selling real estate, I would pick Agent #3.  After all, I would be getting more money from the sale of my house. 

It drives me nuts when they want to add onto the price after you have provided them with a suggested list price, because they know that buyers will offer less than the asking price.  So true, but they will not LOOK at your house if it is overpriced! 

Judy

Posted by Judy Jennings, Broker - The Lanterns at Warren Woods - Ashland MA (The Green Company) over 9 years ago

Hey, Karen Anne.

There's another reason why agents here buy listings: they get bonuses or perks from their brokers for bringing in the listings. Doesn't matter if it ever sales. I guess their theory is that it's better to have a listing than not to have a listing.

Since parking is at a premium throughout California, one of the perks is a prime parking spot near the entrance with one's name on it:

  • Reserved for Top Listing Agent Karen Anne Stone

The other serious problem we have here is that many of the baby boomers who bought homes in the '70s and '80s with 20-year mortgages now own their homes free and clear but are downsizing as empty nesters. For some reason they think that their homes are worth $100,000 more than the foreclosure next door and the short sale across the street. Nope. Doesn't work that way. But you can't convince them of that. Of course, they have nothing to lose because they haven't had a mortgage payment in a while and their home is still worth ten times what they paid for it, even when interest is added in.

I've already turned down three listings this year from "F&C" home owners. It's the power of knowing when to say "No, but good luck."

Posted by Jim Frimmer, Realtor & CDPE, Mission Valley specialist (HomeSmart Realty West) over 9 years ago

A listing just sold for $185000.  I had the opportunity of trying to get the listing (from a friend and I sold them the house).  I did not agree that it would bring $215,000 which is what they HAD to have.  I lost the listing.  It is selling for approximately what I told them.  They didn't like what I told them and I guess didn't like me anymore.  : (

Posted by Barbara S. Duncan, GRI, e-PRO, Executive Broker, Searcy AR (RE/MAX Advantage) over 9 years ago

Very well said!!!!

Posted by BethAnn Long, Realtor, CRS, e-PRO, Spokane Wa Real Estate (RE/MAX Inland Empire) over 9 years ago

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