Which Listing Agent Should This Seller Choose... ?

By
Real Estate Agent with New Home Hunters of Fort Worth and Tarrant County

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.

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Anonymous
Anonymous

Couldn't have said it better myself, Karen Anne. You hit the nail on the head! Here is a quote directly from an email that I sent a seller yesterday:

 "I realize that there are real estate agents out there that will tell you that they can get your house sold for a really high amount, just to get your listing. I would rather be up-front and honest and get your house sold in a reasonable amount of time than let it sit and have you get frustrated."

They appreciate my honesty and hard work and want to list with me.

Sep 18, 2007 04:16 PM #1
Anonymous
Anonymous

As usual, right on point, Karen Anne.  And even as the market is cooling down, Sellers still expect to make a killing.  The agents who take listings at inflated prices are hurting both the Sellers and the Realtors.

Sep 18, 2007 05:04 PM #2
Rainmaker
997,080
Karen Anne Stone
New Home Hunters of Fort Worth and Tarrant County - Fort Worth, TX
Fort Worth Real Estate
Hi Bridget:  It can really get frustrating when on a listing, and have the seller tell you that so-and-so Realtor said he could get them $20,000 more than the comparables show.  I usually ask to see the "comparables" that the other Realtor used, and the usual answer is that there weren't any... the other Realtor just had a "gut" feeling he could sell it for that.  Gee... what kind of pie-in-the-sky would you like ?  Apple or blueberry ?   Thanks for your comment, Bridget...     Karen Anne
Sep 18, 2007 08:20 PM #3
Rainmaker
997,080
Karen Anne Stone
New Home Hunters of Fort Worth and Tarrant County - Fort Worth, TX
Fort Worth Real Estate
Hi Adele:  It is our job as good Listing Agents to make sure our sellers are being told the real truth.  Anything else will just prolong the selling process, and will only hurt them in the long run.  Thanks for commenting... hope things are going well for you, Adele.     Karen Anne
Sep 18, 2007 08:23 PM #4
Rainmaker
86,091
Paula Henry
Home to Indy Team @ Sycamore Group Realtors - Avon, IN
Realtor - Indianapolis Real Estate - 317-605-4174
Karen Anne - I have had agents tell me recently they took listings over priced just to have listings and get buyer calls. The problem with that is, buyers online know what the values are in neighborhoods and they won't call, much less visit the home if it is overpriced. I do not provide a price, rather a range based on a comprehensive study, then let the seller decide the price within the range. If they want too much, they will have to list with the agent who wants to buy their listing and.......................WAIT!
Sep 18, 2007 10:43 PM #5
Rainmaker
997,080
Karen Anne Stone
New Home Hunters of Fort Worth and Tarrant County - Fort Worth, TX
Fort Worth Real Estate
Paula:  That is an excellent comment.  Thanks for being an Agent who is brave enough to tell your seller the truth.  When agents "buy" listings like that... it hurts everybody.  Thanks for your comment...     Karen Anne
Sep 18, 2007 11:09 PM #6
Rainer
274,098
Adam Waldman
Westcott Group Real Estate Company - Hauppauge, NY
Realtor - Long Island
KAREN ANNE:  This is a great point, and sadly, most homeowners will go with the person that tells them what they want to hear, and not the ones that tell them what they need to hear (at least at first).  Once this listing expires, they will then have to listen to the agents that told them to price it lower, but that's not the worst part.  The worst part is that the home is now "stale" and the homeowners will likely have to price the home lower than what the other two agents originally said.  Greed is a very foolish concept when selling a home, but this is the world that we live in.  The smart ones price it right and sell it fast.  Good post, Karen Anne.
Sep 19, 2007 04:46 AM #7
Rainmaker
637,311
Brian Block
RE/MAX Allegiance, Managing Broker/Branch Vice President - McLean, VA
Northern Virginia & D.C. Real Estate
Karen Anne, this happens just way too often and this is why we have such an overflow of inventory sitting on the market for months now.  I had the daughter of some homeowners contact me about a week ago saying that she was worried for her parents because they had their home on the market with the same agent for over a year, have reduced the price and it hasn't sold.  She said she's worried about them because they have already moved out months ago and are now carrying two huge mortgages.  I researched the home and it has been listed for 392 days with the same agent (I wonder how they got a listing agreement for over a year or got the sellers to renew!!) and is still about 15K overpriced.  The daughter said she was passing on my information to her parents but didn't want to part of this.  The parents still haven't called and are still waiting for their overpriced home to be sold by the agent who bought the listing.
Sep 19, 2007 04:55 AM #8
Rainer
67,172
Keith Perry
Coldwell Banker - Hiram, GA
REALTOR - West Metro Atlanta

Karen in our business plan we target expired listings. Sometimes they were priced too high and we adjust when we list them. Often the price is fine but I see very poor marketing for the home. Agents that buy listings get lucky from time to time but we see their name over & over on MLS expired sheets.

my humble 2 cents

Sep 19, 2007 05:03 AM #9
Rainer
234,324
Susie Roscoe
Signature Realty Associates - Brandon, FL
Real Estate Specialist | Brandon, FL
Great points Karen Anne!!  I've lost a few listings due to "this" very program.  BUT...when the listing did NOT sell at the recommended price, I was happy to return and re-list at the appropriate price.  What you need and what it's worth are NOT the same story anymore.  Sellers need to be educated not mislead.  How great to have "your sign" in their yard and watch it NOT SELL...huh?
Sep 19, 2007 05:19 AM #10
Rainmaker
997,080
Karen Anne Stone
New Home Hunters of Fort Worth and Tarrant County - Fort Worth, TX
Fort Worth Real Estate
Adam:  Another sad part for a seller who falls into this trap... is that the seller is often one who really needs to sell for some critical reason... other than just wanting to sell their house.  Sometimges I think it is this very critical need... that clouds their judgment.  Thanks for your insighful comment.
Sep 19, 2007 12:17 PM #11
Rainmaker
997,080
Karen Anne Stone
New Home Hunters of Fort Worth and Tarrant County - Fort Worth, TX
Fort Worth Real Estate

Brian:  Along with my comment to Adam above, in the same vein, it may be the Listing Agent who has that critical need... a need to get a listing... that is part of the problem.  Thanks for your comment.

Sep 19, 2007 12:19 PM #12
Rainmaker
997,080
Karen Anne Stone
New Home Hunters of Fort Worth and Tarrant County - Fort Worth, TX
Fort Worth Real Estate
Keith and Robin:  In targeting expired listings, you could be met by sellers who are either reeeealy angry because they may now know they got "snookered..." or reeeely glad to see a Listing Agent who is finally honest with them.  Good Luck on your expireds, and thanks for commenting.
Sep 19, 2007 12:22 PM #13
Rainmaker
997,080
Karen Anne Stone
New Home Hunters of Fort Worth and Tarrant County - Fort Worth, TX
Fort Worth Real Estate

Hi Susie:  Yes, "need" does not determine value.  When my sellers start to go into telling me how they need to get a certain price for some unconnected reason,  I often tell the story about my Great Aunt Brenda, who needed to sell her home for $50,000 over what it was worth so she could buy a new Corvette.

I had the unpleasant task of telling her it wasn't going to happen, and that she needed to invest in a skateboard.  LOL  Thanks for your comment.  Hope to see you in November.

Sep 19, 2007 12:27 PM #14
Rainer
197,603
Marshall Enterprises
Marshall Enterprises - Saint Michael, MN
Antiques, Lawn Care, and Trashouts

I came back this far, Karen Anne, to find a post to reblog.  This one is excellent.  But, I can't reblog it!

Dec 27, 2012 03:13 PM #15
Ambassador
1,131,186
Joni Staples
Berkshire Hathaway Home Services - Anderson Properties - Huntsville, TX
Your Huntsville / Lake Livingston Area REALTORĀ®

I looked for posts to reblog, as well, Marshall. If I could, I would be reblogging a ton of her posts!

Oct 17, 2013 12:15 PM #16
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