THE TRUTH DOESN'T ALWAYS PAY. I have found this to be true especially during this tough real estate market. It was always true to some extent but a depreciating market increased the number of times I was reminded of this.
One of the backbones of many Realtors business is having a number of listings. This is something I've heard this told many times during my two decades as an agent. Unless you are going to work strictly as a Buyer Agent you will no doubt find truth in this statement.
Like many agents I am always interested in good listings. Good listings mean listing that have a high probability of selling. To get most listings it requires doing a listing presentation for the home owner(s). I enjoy doing these. I know what my strengths are and I know that I have a good shot at getting most properties sold.
However, some sellers do not want to hear the truth.
In fact sometimes when you tell the truth you lose the listing. You immediately lost the ability to earn the listing commission. I don't mind if I've lost it to someone else they feel will do a better job. My disappointment is when my suggested list price is not considered high enough that I have to shake my head in disbelief. I don't just grab a number out of the air. I'm disappointed not just for me but for the seller. Chances are they are not going to have a quick sale and no matter what they say, most do not want their homes languishing on the market only to eventually reduce them over and over again.
Someone might wonder if I come in below market value. The answer is: ABSOLUTELY NOT!
One recent example is a house where I suggested a sale price just over the half million dollar mark. Instead it got listed with someone else for $599,900. Months go by. No contract. Reduction. Months go by. No contract. Another reduction. Still no contract. Now it is listed below my suggested list price. Would the owner have been better off to list lower to begin with? I would certainly think so. Perhaps he does too.
Could I have done something different in order to change the outcome?
Definitely! I could easily have suggested a much higher list price. Chances are I would have gotten the listing because, in the example mentioned above, I had been called in to provide advice on fixing up the property months before it was put on the market and continued to do that up until I presented him with my suggested list price.
Did I change my business practice based on losing this listing (or any of the others)?
No! For me it's better to lose the listing than to do that. Real estate can be a very stressful business. I do not believe in knowingly adding to the stress in my life. Over-priced listings are exactly that...unnecessary stress.
Lesson learned:
Know your market inside and out. Work at it until you are comfortable with what your gut tells you the value is and then double check the numbers to make sure you are in the ballpark. Stick with the facts and work with those that appreciate your honesty.
©Copyright Kate Elim 2011
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That is always a shame when another agent lists higher than you and then you see it sitting there. When that happens to me, I always exit the listing appointment with a note for them to reach me if they change their mind regarding price. Or, I tell them that we can list at their price for 30 days and if we do not get showings or offers that they will reduce to my recommended price and have them sign the price reduction ahead of time. This works also and shows them that you will at least try their price. It is not much work to do a price reduction and well worth it to prove a point.
Very well said and totally true. I handle my listing presentations and suggested list prices the same way. An inflated list price doesn't do justice to anyone, and I'd rather not take the listing than "reformulate" my recommended list price to suit a seller's expectations. That sets everyone up for the stress (as you so aptly called it) of many, many days on the market and almost certain future price reductions before it'll sell.
The TRUTH is what our profession is about. Stick to your ethics and morals. Do not compromise them for one listing. In the end, the Sellers will realize this. After all is said and done, it is still your reputation at stake. Years of honesty can be wiped away with one act. Just move on with your pride and dignity.
Before advising the clients for weeks prior to the listing date, I get the listing agreement signed, with the understanding that price will need to be reviewed again prior to the on-market date, in case comps have changed. That way you're not doing the job of someone else who will be getting the listing. Thanks for sharing your story in The One That Got Away.
Taking an overpriced listing is a common practice of far too many real estate agents, and my local market is no exception. I applaud your thorough research and market knowledge. If a seller chooses to not accept it, then move on to one who will. My local MLS is crowded with far too many overpriced listings.
Hi Diane...Good point. That is certainly something I do when we are not that far apart but there was absolutely no way he would have agreed to a $75,000 reduction in 30 days. Realizing that meant there was no way it would work. Thanks for your suggestion though because it is important to be flexible.
Kate
Hi Charlie...I try as well. I may end up with a few less listings but the goal is to get them sold, not just listed.
Kate
Hi Clay...I always feel that the truth is one of, if not the most, important thing I can bring to a relationship. That certainly includes those I establish with customers and clients.
Thanks for your comment.
Kate
Hi Kate, I guess we all have one that got away sadly I had about three this year....I just got "moral satisfaction" one of the sellers e-mailed me and said that the agent they chose "was the devil" and wished that they went with me....minus $30k for me but moral victory....
It takes guts to follow your guts. Good for you-- and sometimes you just have to walk away. Thanks for sharing your story! Kathy