Hey! It's Not 2005 Anymore!

By
Real Estate Agent with Evers & Company Real Estate, Inc. AB95346

Last week, a nice house came on the market in Woodley Park, a favorite neighborhood of mine.  It's also a favorite for some clients, and the day the house was listed, I called to arrange to show it to them.  Sorry, the agent said, no showings until the broker's open house (6 days later).  OK, I am a patient woman, and I knew that no one else can get in, so last Tuesday I finally showed it.

The house shows very well.  It was also very well priced, which was a good thing because there are two very similar houses for sale on the same block.  My buyers liked it and we were discussing maybe possibly writing an offer.

The agent decided to help me out.  She told them she expected the place to sell for way more than the asking price and that she was pretty sure there would be three other offers. She even speculated that they expected to get about $70,000 over the asking price.

Whoa!  Pricing for that much less than your sellers want to get is a strategy that went out of style here about two years ago!

These buyers are what you might call motivated.  They live in an adorable doll house in Georgetown, and baby number two is due very soon.  But they are also being very smart about this move, and the thought of getting involved in a bidding war in this market did not appeal to them one bit!

This listing agent is an old pro.  I really like her a lot and have enormous respect for her.  But even the best of us have breakdowns of the old brain-to-mouth filter mechanisms.

And I think her listing will sell quickly, it just won't be to my buyers.  Ah, what might have been!

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Rainmaker
996,054
Karen Anne Stone
New Home Hunters of Fort Worth and Tarrant County - Fort Worth, TX
Fort Worth Real Estate

Patricia:  It sounds to me like you need to put one more thing in your purse to take while showing besides mls keypad, blackberry, pen, and other stuff.  In this case... it would be a rolled-up sock to stuff in this darling woman's oversized blabby-mouth.  Not a good plan.  Take care....

December 12, 2008 04:26 AM #12
Rainmaker
996,054
Karen Anne Stone
New Home Hunters of Fort Worth and Tarrant County - Fort Worth, TX
Fort Worth Real Estate

I know this is off the subject... but with this being Christmas time... I would love to see a post on how one of my favorite places to shop, Pentagon City Mall... got decorated this year.  Always loved that place.  Take care...

December 12, 2008 04:28 AM #13
Ambassador
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Cindy Jones
Integrity Real Estate Group - Woodbridge, VA
Pentagon, Fort Belvoir & Quantico Real Estate News

Ahhh what about the appraisal?  Is the house 70K underpriced?  It is amazing that anyone would try that tactic in today's market.  We all know how quickly it can backfire.  Oh and by the way if the home was in the MLS and you were not allowed access that is a violation of MRIS rules!

December 12, 2008 05:15 AM #14
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Richard Iarossi
Coldwell Banker Residential Brokerage - Crofton, MD
Crofton MD Real Estate, Annapolis MD Real Estate

Patricia, I'm stunned that she would try that strategy in this market. Good houses still sell over list on occassion today, but $70K over is a stretch. Sounds like she's playing games, especially since no showings until six days after entry into MLS...completely illegal.

December 12, 2008 06:45 AM #15
Rainmaker
468,836
Janice Roosevelt
Rory Burkhart Team, Keller Williams - West Chester, PA
OICP ABR, ePRO,Ecobroker

Definitely information overload. I hope you hae a spectacular 2009, you deserveit!

December 12, 2008 06:46 AM #16
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Todd Clark
Keller Williams Realty - Beaverton, OR
Broker - Beaverton, Oregon Real Estate Expert - (503) 524-9494

What happens when she doesn't get more than one offer over the listing price? Are her sellers going to be upset and turn down the offer? She really is setting herself up to have some unhappy sellers.

Todd Clark, Helping Families Home - www.IFoundYourNewHome.com

December 12, 2008 06:51 AM #17
Rainer
99,720
Heather Oberhau
Prudential Fox & Roach - Newtown, PA
Bucks County Real Estate, e-PRO

Silly agent.  She blew an opportunity to look like a superstar.  I still do think that you can price a home to generate multiple offers, by pricing it *right* where you think it will sell and staging the crap outta it.  Then, you use the multiple offers to pick the best offer (Personally, I would pick the one with the strongest financials).  Thinking you're going to get $70K over asking is CRAZY, though, unless it's a multi-million dollar property.

It sounds like she over-promised her Sellers. 

Also, we can put our listings in as Active/No Showing in our MLS and it's perfectly legal as long as NO ONE goes in the property.  I try to put them in at least 2 to 3 days before showings start to allow agents to get the house out to their Buyers and build interest.

December 12, 2008 01:38 PM #18
Rainer
151,345
Ken Montville
RE/MAX United Real Estate - College Park, MD
The MD Suburbs of DC

I don't know about blabbing about the price but the technique is as old as the hills and, hey, we gotta be creative these days.  The old "auction" method of keeping people at bay and then having muliple groups in the house create a sense of urgency.  Pricing way below market is an almost sure-fire way to get multiple offers (I'd do it myself if  could only get a Seller to go along with the plan).  Of course, it can backfire when buyers are less than thrilled about getting into a bidding war.

However, I can tell you from experience that it does work and it will usually get the Seller close to what they "really" want.

December 12, 2008 06:41 PM #19
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Jeff Belonger
Social Media - Infinity Home Mortgage Company, Inc - Cherry Hill, NJ
The FHA Expert - FHA Loans - FHA mortgages - USDA loans - VA Loans

Pat... awe. that important list. Everyone should have one and not settle for less... this is a huge investment.

On another note...  I will be down in the DC area on the 21st and 22nd... I am going to put together an AR gathering together for noon on the 22nd... I might be staying in Annapolis...  or in that area. Any recommendations? 

jeff belonger

December 12, 2008 06:59 PM #20
Rainmaker
476,374
Barb Szabo, CRS
RE/MAX Trinity Brecksville Ohio - Cleveland, OH
E-pro Realtor, Cleveland Ohio Homes

Pat, It reminds of some very good advice I received many years ago.  "State your case and then keep your mouth shut", which is exactly what she should have done.  Sounds more like she is working for herself and her bottom dollar than for her sellers.

December 12, 2008 06:59 PM #21
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Nestor & Katerina Gasset
International Properties and Investments LLC - Wellington, FL
Realtors, Wellington Florida Homes For Sale

Patricia- Did you notice these cool blue colors for comments returned now? It is so easy now to scroll down to the return comments.

December 12, 2008 07:09 PM #22
Rainmaker
573,877
Terry & Bonnie Westbrook
Westbrook Realty Broker-Owner - Grand Rapids, MI
Westbrook Realty - Grand Rapids Forest Hills MI Re

Buyers need to make the final decision all we can do is give them the opportunities. Sometime listing agents do make comments thinking it will help the seller and sometimes it does backfire.

December 12, 2008 07:45 PM #23
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Ellie McIntire
Ellicott City Clarksville Howard County Maryland Real Estate - Ellicott City, MD
CDPE, Howard County Homes for Sale

No showings for 6 days till the brokers open? If it's on the market it means it is available to show, right? Isn't that a violation with the MLS?

 

December 12, 2008 09:56 PM #24
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Jon Zolsky, Daytona Beach, FL
Daytona Condo Realty, 386-405-4408 - Daytona Beach, FL
Selling Daytona paradise for heavenly good prices

Patricia,

Things happen. You can't always change things, and the toughest thing to change is the opinions of your clients

December 12, 2008 11:27 PM #25
Rainer
339,851
Kris Wales
Keller Williams Realty - Lakeside Market Center - Macomb, MI
Real Estate Blog & Homes for Sale search site, Macomb County MI

Wow. What are the sellers going to do if someone hands their agent a full price cash offer with no contingencies?

I can't believe the agent is doing this today, in 2008.

December 13, 2008 04:33 AM #26
Rainmaker
91,381
LaShawn Norden
Keller Williams Heritage Realty - Longwood, FL
REALTOR, (321) 377-0157, Your Real Estate Advocate in Central FL

Patricia~I believe that less is more. The less you say, the more you may receive. I'm sure you'll find your clients the perfect house!

 

December 13, 2008 07:39 AM #27
Rainer
256,188
Debi Ernst
St. Charles County, Missouri - Prudential Alliance Realtors - O'Fallon, MO
GRI, e-PRO, Broker/Sales Associate

Patricia - Wow! I'd like to know what the house actually sold for.  Please keep us posted...  :)

December 13, 2008 10:28 AM #28
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Barbara-Jo Roberts Berberi & Corinna Birgit Cromartie
Charles Rutenberg Realty - Palm Harbor, FL
Palm Harbor & Dunedin FL Residential Real Estate

Pat - I don't know ANYONE right now that is offering MORE than the asking price - they are all low-balling everything!

December 13, 2008 06:26 PM #29
Rainmaker
310,864
James Downing - Metro DC Houses Team REALTORS®, CRS, GRI, ABR,MRP, MilRes
Real Living | At Home - Washington, DC
When Looking to Buy or Sell - Make the Right Move

Thats a bit nutty.  Not to mention the fact that; isn't not having a property in MLS and NOT being able to show it a violation?

December 15, 2008 05:32 PM #30
Rainmaker
312,527
Carol Culkin
Reece & Nichols - Leawood, KS
Overland Park

Pat - I agree with you, buyers prefer to feel like they got a fair shake in this market instead of feeling pressured by a bidding war to pay above and beyond the list price, especially by 10's of thousands. 

December 18, 2008 12:04 AM #31
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Patricia Kennedy

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