Top 10 Ways Not to Pick A Listing Agent, Part I
Posted in For Sellers | By Blair Newman and Dave Emerson | Tags: Home Seller Tips, How Not to Pick a Real Estate Agent, Lakewood real estate, Long Beach Real Estate, Orange County real estate, Picking a Realtor, Real Estate Tips, Southern California Real Estate
Poor Mr. Williams. We just drove by his house & noticed the sign was down. Hadn’t sold. If he’d read this post 6 months ago, it could have saved him at least $50,000 and half a year of his life.
Unfortunately, Mr. Williams has lots of company. We’d say at least 90% of the today’s sellers today are making at least one of ten major mistakes in picking their agent.
These are mistakes people naturally tend to make–and virtually all agents are able to easily take advantage of those tendencies if they choose to. Because they’ve listed a whole lot more homes than you have!
Here’s our list of the most common wrong reasons to pick a listing agent. Read it and weep. We do.
10. Amazing gimmicks. Mr. Williams picked his agent because of his “This House Talks” sign. Uses an 800 number to capture leads & texts them right to the agent’s phone. Very impressive to demonstrate to a potential seller.
But a gimmick is just a tool, & it doesn’t sell the home any more than the latest lazer level makes an incompetent carpenter into an expert. Selling today takes expert pricing, staging, negotiating, and marketing, plus integrity, diligence, & experience. Not one or two flashy gimmicks. Just ask Mr. Williams.
9. Mr. Williams also liked the agent’s warm friendliness. Can’t say we blame him–we like the guy too. But he’s only been in the business a few years, has never seen a market like this before, and it shows:
Of the 27 listings Mr. Williams’ friendly agent has taken over the past 12 months, only 4 have actually sold. 16 have expired or been canceled without selling–4 expireds for every sold! We had zero actual expireds in the last 12 months, but quite a few closed sales. Gimmicks and friendliness alone just don’t cut it.
8. Never list with someone from work. Inherently bad decision. Today you need a full time agent who’s good enough to make his living from real estate sales alone. If you know her from work, she’s not full time, no matter what she claims. Blair and I were both part time once–the first two years of our career, when we were also quite inexperienced. We know a whole lot more now than we knew then! Never, ever, ever list with a coworker, unless you work in a real estate office!
7. Friend or family, especially one who “really needs” the listing (duh!).
I recently met a fellow whose Lakewood home had been on the market for five months without an offer.
“How’d you pick your agent? ” I asked.
“Friend of my wife.”
“Any idea how many homes she’s sold in this tract?”
“Not as many as you.”
Actually, that agent had never even listed a home in that tract before. In fact, I just checked the SoCalMLS data base, & she’s never listed or sold a home in the entire city of Lakewood. And she’s only sold a grand total of one listing in the past 12 months, anywhere! That home in Lakewood’s still on the market, but now it’s in foreclosure.
Blood lines, friendship, club or church membership, or having a kid on the same soccer team as yours has absolutely nothing to do with being a good agent. Before you even mention your situation with a friend or relative, do some research. (We’ll give some tips in a few days.) Otherwise, you may become “obligated” to list with an agent that isn’t right for you. It’s a great way to ruin a friendship or family relationship. And lose money.
6. Because of the office or franchise. You can’t tell a book or an agent by their jacket! Our 30 years of selling hundreds of homes has taught us that their are bad agents in virtually every office. And good ones in some. You’re never even going to see the broker, let alone any franchise employee.
Franchises are primarily created to help the broker recruit agents and secondarily to pool funds for generic TV and other old-media ads.
The office we work at is affiliated with one of the most successful franchises in California, but I don’t think we’ve ever once mentioned which franchise it is. You really have to search to even find it on our commercial website. That’s because it just isn’t that important. We’re the ones our clients see & must rely on.
Those are five of the top ten mistakes we’ve seen sellers make, but this post is getting too long.
For the top five wrong reasons to list, including one that most agents know will get them the listing almost every time, just click here.
Tags: Home Seller Tips, How Not to Pick a Real Estate Agent, Lakewood real estate, Long Beach Real Estate, Orange County real estate, Picking a Realtor, Real Estate Tips, Southern California Real Estate
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March 26th, 2008 at 9:51 pm
Hello,
what did you mean when you wrote “If he’d read this post 6 months ago, it could have saved him at least $50,000…”?
Dave Emerson here, one of the authors::
Good question, Cyberdude. Figuring out how much info to include is always a challenge. Thanks for asking!
Here are the details.
This is a vacant house which this seller, who lives near Riverside, inherited. So it’s been sitting empty for six months with nobody getting any use or value out of it, declining in value, while the seller pays the mortgage, taxes, gardener, utilities, & commutes out here to check it out periodically.
This was a very nice but overpriced home that needed some tweaking in staging, aggressive marketing, and an immediate, aggressive price “adjustment,” as we diplomatically say. In any market, especially a declining one, our goal is always to have the home in a solid escrow within 30 days of putting it on the market. When our clients cooperate, we normally have the home in escrow within ten days. (See “How to Sell Your So Cal Home for Top Dollar in 30 Days” )
There’s no reason that home shouldn’t have been in escrow five months ago. Instead, it’s still sitting vacant and unsold, and a little the worse for wear/time.
During those five months since we should have had it in escrow we’ve seen major declines in value, as you’re aware. I estimate it at roughly $30,000 - $40,000 for this specific home. There are currently 6 homes for sale on his street, including a couple below-market foreclosures. There were about 2 6 months ago.
Instead of banking his ever-declining equity or using it to pay down credit card and car loans, the seller’s been making about $4,000 a month payments on interest, tax, and insurance. $4,000 x 5 months = $20,000. (Technically, it would have only been closed for about 4 months by now, but it isn’t even in escrow yet, so I added a fifth month.)
I could add in costs of ownership like the gardener, trips out weekly to inspect it, utilities, and ongoing repairs. There’s also the effect an extended time on the market has on buyers’ perceptions. Unoccupied homes just don’t get better sitting–landscaping deteriorates, dust and dirt accumulate, things break while nobody’s there. If his insurance company finds out it’s vacant, insurance costs could increase tenfold.
So we’re already well over $50,000–and there’s still no sign of that home selling any time soon. All because he picked an agent for his gimmick and friendliness (as well as our # 1 way not to pick an agent, coming later today). Instead the seller should have looked for experience, diligence, competence, integrity, track record, and appropriateness for the property and situation. The agent he chose did have a “Talking House Sign,” but had never sold a home in that tract, had only a few years experience, and had a track record of selling only 1 of every 4 or 5 listings taken.
The other sad fact, is that when the seller first invited us over to give him input about seven months ago, he’d already spent several months and tens of thousands of dollars trying to “fix it up,” while the market was declining. Then he tried to sell it himself at a price way over market for another 4 -5 months. We’ve been preaching “the time to sell is yesterday” for the past two years. Had this seller called us when he first inherited the property we could have saved him well over $150,000, between declines in value, expenses for upgrades, and ownership costs.
The sooner a seller calls us, the more money, time, and grief we can save him or her. In this market, it’s kind of like treating cancer as early as possible! 562.822.7653.
Does that help?
March 31st, 2008 at 11:24 pm
Could you tell me which real estate company you are with, Century 21, First Team, ReMax, Coldwell Banker, etc… I couldn’t find any mention of it on your other website. Also, do you handle Orange 1 mile east of the 55? It seems you don’t, looking at your bio.
April 1st, 2008 at 4:47 pm
Cypherdude,
Dave’s a broker himself, but we’re both affiliated with Prudential California. We think it’s a good company, but still don’t recommend picking an agent by his or her company.
As for franchise affiliation, Dave’s worked for Prudential, Gallery of Homes, and Realty Register (for those of you who were around in the 80s)–without ever changing office, managers, or corporate president!
We could probably service a seller in Orange, but would most likely find a local agent for a buyer there, depending on the specific situation. After over 30 combined years selling & something like 80 combined years living in So Cal, we’ve gotten to know a lot of communities.
We have represented sellers with property from the west San Fernando Valley to a 400 acre “dry farm” in Oklahoma.
In both of those cases, we located and contacted experienced local agents to assist us, but we stayed in the loop for various reasons.
We generally service the area roughly south of the 105 freeway between the 710 and 55 freeways, but have been going further south into OC of late, depending on the situation. Blair is also familiar with the area around his alma mater, Biola, in La Mirada.
For buyers out of our area, we normally find a competent local agent to refer them to.