Deerwood Realty and Friends Podcast
I feel like I’ve always been pretty honest when working with my clients, but I know that it’s easy to lie in the real estate game and it seems like few agents ever get caught to where it affects their business so I thought I’d take a look at some of the more interesting ones.
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Thoughts:
1. “Now is a great time to sell your home.” Is it? Right now, probably. When the market is down, is it still a good idea to sell your home? I was working with a seller just before the pandemic hit. He was getting emails from another agent in town. Just before the pandemic, the agent was saying you have to sell now because the economy is going to collapse and your house will be worthless. 3 months later, the housing market is on fire, same agent writes that it’s time to sell now because the housing market is totally on fire. What changed? Nothing…the real estate agent is trying to cause a sense of urgency for prospective sellers.
2. “I can’t negotiate my commission.” You can’t or you won’t? That is the real question. And, to be honest, I think the average seller has no idea what to expect in terms of commission. From what point does the negotiation start if you have no idea what your commission usually is? The agent in front of you may not be able to negotiate their commission for all kinds of reasons, so it might not be a lie. However, some can. That being said, you have to understand as a seller a few things.
a. Going with the lowest commission you can find as your only basis for choosing an agent will usually land you in a bad spot. For one, the agent isn’t going to be putting their best foot forward, or another, you might not be getting the service you’d expect.
b. There’s a time to negotiate a commission. If you call up an agent, and the first thing you do is try to negotiate commission, without any sort of context, the agent is probably, rightly not going to want to have anything to do with lowering their commission. They may raise it because they perceive that you will be a pain in the ass.
3. “Your house is worth x.” There’s an odd dance that occurs when home sellers are looking to list their property for sale. They tend to work in two camps. The first camp looks at commission as the only determining factor on choosing an agent, and the second camp looks at how much the agent says the house is worth. In the real estate industry, we call this practice buying the listing. It’s pretty simple: Let’s say you see a Zillow estimate and it says the house is worth 300k. Zillow estimates are still pretty terrible, so then you call 2 agents out. One shows you actual recent comparable sales that indicate the house is probably worth 325k. The second agent comes out and asks what the first agent says and says he can sell it for 350k.
Sellers in their mind think, I’m going with guy that says 350k…even though there is no justification for the price…but why?
a. They like the confidence of the real estate agent. They think it will help sell the home.
b. Seller wants to make the most possible on the house.
But, what happens when it doesn’t sell? Well, it’s likely to be months after you listed the house before you’re going to realize you’ve been duped…and you will probably hear how you need to lower the price with the agent you listed with. It’s not like you are going to call the first agent who was honest with the price and admit you were wrong. The world doesn’t work that way.
4. “I have a list of a thousand buyers ready to buy your house” They don’t have a thousand buyers ready to buy your house as soon as it’s listed. They may have a cousin that would buy your house if you sold it to them for a below market price, but they don’t have a thousand buyers, unless they’re counting the people in the local phone book.(are those still a thing?)
5. “Your house is perfect and you just need to list it” Could there be a house out there that is perfect before you list it? I guess. Would your home sell faster and for more money if you made some tweaks to the home before listing it? Absolutely. Is this the worst lie ever? I don’t think so. In making compliments to your home that are unwarranted, the agent is looking to position themselves as your buddy. They don’t want to come across as insulting…after all, you own the home and usually have pride in it.
6. “Something, something, something, we’re number 1” Top listing agent in St. Louis? By transaction or volume? Top brokerage in St. Louis? By transaction or volume? It’s usually a lie. If you work on a team of 15 people, and last week you were selling cosmetics at Macy’s, are you really number 1 at anything selling houses? Not to put down anyone at Macy’s. My point is that new agents are quick to take advantage of positions they didn’t have anything to do with. And the subjectiveness of number 1 makes the lie even more ridiculous.
7. “Your house doesn’t need professional photos” Why do people fall for this one? You’re paying a listing agent to sell your house, and you are going to let them use their iphone and snap a few pictures for the listing? What kind of nonsense is this? If you ever hear a real estate agent say this, just walk away. They aren’t serious and they aren’t professionals.
8. “If I don’t sell your house, I’ll buy it, Guaranteed” What kind of nonsense is this? Who falls for this? And, let’s be completely honest, if the real estate agent is so anxious to buy the house, why wait to put it on the market? Just sell it right there and then. Should also save on commissions because the agent didn’t have to go anywhere to find a buyer. This is a tactic to get in the door. It’s not real. Go ahead and ask agent how many homes they’ve bought in the past year, two years due to their guarantee. If there are a lot of homes purchased, why? Why is the agent that bad at selling homes to the public. If there are no homes purchased, why?
9. “I’ll personally work with you through the entire selling process” If you are working with a real estate team, the chances that the listing agent is going to work with you through the entire process is slim. They aren’t putting a sign in your yard, they aren’t going to personally be attending the open house, they aren’t preparing the listing, they may have a team member field all listing inquiries, and when the home is under contract, it’s likely to go to a closing coordinator. The only time you know that you’ve been had is when someone in the office asks for a review and by then you forgot that you went with that listing agent because they were going to work with you throughout. Note, it’s entirely fine for listing agents with teams to tell you up front that they aren’t around for anything more than the listing paperwork. It’s the lying part that I don’t like.
10. “Open houses don’t sell houses” This is a super contentious issue that will never end. You’ll read somewhere where some agent or some investor will say, the listing agent is only having an open house so they can find more listing opportunities. That’s not been my personal experience. I have sold at least 3 homes because of an open house, and I’m quite sure many buyers who end up writing contracts on houses have taken the opportunity of an open house to come through the house again to double down and make certain that they want to make an offer.
There can be instances where not having an open house makes sense, but the blanket statement that open houses don’t sell houses is a lie.
Source: ME
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