Special
Report...
Selling a home should be like any other business transaction,
but all too often sellers make emotional or impulsive
decisions that cost them money and time. Choosing the
right Realtor to market a property and negotiate the
sale is the most important step in the process.
“My friend (or family member) sells real
estate.”
Friendship alone isn’t enough to establish a
professional’s credentials. Use tough standards
when selecting an agent, just as you would when hiring
an attorney, a doctor, or an accountant to handle your
taxes. A true friend will understand and appreciate
that this is a business decision and will offer their
credentials and expect to compete for the listing. Besides,
if a problem or challenge develops while selling your
home, do you want to risk damaging a friendship or family
relationship? Could you fire your friend or relative
if it wasn’t working out?
“Your presentation sounds good. I’ll
list right now”
Look at more than one presentation and consider the
advantages and disadvantages of each. Making an impulsive
decision when caught up “in the moment”
could be difficult to correct later. Since you normally
contract to list your house with the agent for a specific
period of time, you may find yourself unable to “switch”
to another if you find yourself unhappy with the service
you receive.
“You’re the only agent who agrees
with my selling price.”
Some agents tell you what you want to hear. In the
real estate profession, this is known as “buying
a listing” and is employed by shortsighted agents
who are more interested in themselves than they are
in you. However good it works as a short-term “sales
tactic” in getting your listing, it is an extremely
poor strategy in selling a home at the highest possible
price.
You see, your house gets the most attention from other
agents when it is a “new” listing. If priced
properly, lots of agents will show it to their buyers.
If you price it too high, no one will show the house
and it will sit on the market for some time. Matter
of fact it will draw attention to the other properties
for sale in the area as they will look like a great
value compared to your asking price. When you finally
drop your price to reflect its real value, your house
is “old news” and buyers may think you are
growing desperate. Therefore, the prices you are offered
will come in lower and lower - and you may find yourself
accepting a price that is below what you could have
received had the house been priced properly to begin
with.
Remember, pricing your home too high will only make
similar houses for sale look that much better. Overpricing
helps sell those houses, not yours.
“I don’t need references. I’m
a good judge of character.”
A snap judgment isn’t good enough. You also need
to determine if the agent is competent and the best
way to do that is to check up on references. Ask for
references on their recent sales -- check up on references
of recent customers. Find out how an agent’s customers
feel about their selling experience.
Remember that how long an individual has been in real
estate isn’t necessarily all you should look for.
Experienced agents can grow jaded and not work as hard
- newer agents sometimes make up with enthusiasm and
effort what they lack in experience.
“I’m going to list with the agent
who has the lowest commission.”
You get what you pay for. Paying a cut-rate commission
will often get you a sign in the front yard and placement
in the Multiple Listing Service, but little additional
effort from your agent.
Realize that agents and real estate companies put up
their own funds to market and advertise your home. Marketing
and advertising costs money -- the lower the commission,
the less incentive for an agent to put up his or her
own money to market your home.
Incentive plays a very important role in sales. A “full
service” agent earning a full commission will
often “drop everything” to handle any challenges
that come along - an agent earning a small commission
does not have that same incentive.
Incentive is also important to the buyer’s agent.
Since there are almost always two agents involved in
every sale, they split the commission according to the
listing agent’s instructions. One agent is your
listing agent. The other agent is the buyer’s
agent. When your listing agent dropped his commission,
did he also reduce the commission that will be paid
to the buyers’ agent? If so, you won’t find
as many agents willing to show your house - they’ll
be showing houses that offer a customary commission
to the buyer’s agent.
Finally, negotiating ability is an important skill
in a listing agent. Are you willing to put your faith
in an agent who can’t even negotiate his or her
own commission?
“The agent is what counts - not the company.”
Agents who work for large well-established companies
with lots of agents do have some advantages. Large companies
generally have longer office hours, so someone is always
available to answer an ad call on your home. Large offices
often have larger budgets and can spend more on advertising.
The ad space for your particular home might not be huge,
but because the total ad is so large it gets lots more
attention.
Large real estate companies often have lots of agents.
This is important because when your house is newly on
the market, the company may stage an “office preview”
where every agent in the office comes through and tours
your home. Every agent who views your home and is impressed
is another agent on your sales team.
Additionally, larger companies are often better at
offering ongoing education to their agents. As a result,
your agent may be better qualified and prepared to offer
a quality service. Although most states require real
estate agents to enroll in “ongoing education”
to keep pace with changes in the real estate market,
many agents only take the “bare minimum”
in ongoing education courses. Sometimes, large offices
are better at convincing their agents to go beyond the
minimum.
There are exceptions to every rule, of course. Some
very effective agents go off on their own and open private
offices or “boutique” agencies.
“All realtors passed the same test so
they must know the same things.”
The real estate profession is constantly changing and,
as mentioned above, the best real estate professionals
stay abreast of those changes by continuing their education.
Some go beyond the required minimum requirements. Many
agents acquire “professional designations”
that show they took additional specialized courses.
“This agent will hold an open house every
week.”
Open houses can and do sell homes, but usually not
your home. Only a small fraction of the homes held open
are sold as a direct result of the open house. More
often, “open houses” are a way that real
estate agents “prospect” for potential clients.
If they develop a rapport with those visitors to your
open house, they can find out about their housing needs
and sell them the home that most closely matches those
needs. Meanwhile, the person who eventually buys your
home may be visiting someone else’s open house.
Good agents know better than to pin all their selling
efforts on an open house. They use their time in more
effective marketing methods. The most effective marketing
is not directly to the public, but to other agents.
By getting other agents interested in your home, your
listing agent multiplies your sales force beyond just
one individual.
“I want an agent who lives in my neighborhood.”
Knowledge of the local market isn’t only acquired
by living in the immediate neighborhood. Sure, your
agent should have intimate knowledge of recent sales,
models, schools, businesses, and so on, but that is
easily achieved through extensive research. Convenience
shouldn’t be the primary reason for choosing an
agent.
Residential and Investment Property Advisors
Alan Siebenaler, Founder
Direct: (310) 625-6398
alan@investLA.com