Ahhhh... back from vacation... and I must confess it's awfully darn cool to GO to the beach and then come HOME to the beach!
Anyway, here's a follow-up to my last pre-vacation blog about the show Loreena Yeo and I did together in the SWS Virtual Studio about getting listings sold FAST.
One of more memorable messages conveyed during that show was Loreena's utter and complete commitment to walking away from a listing that doesn't meet her requirements. If the seller refuses to price properly and/or to follow her advice on preparation and staging, she does not want the listing. Period.
Many listeners commented to me afterwards how refreshing it was to hear a real estate agent so secure in her value and confident in her abilities - that you couldn't help but FEEL the control Loreena takes of her business and her clientele, and be a bit awed by it.
Perhaps that's a bit melodramatic, but only a little bit. Seriously, it was impressive.
Well, so maybe everyone wasn't so impressed. A few listeners contacted me afterwards chiding us for making it sound "so easy to walk away." That we were being unreasonable and irresponsible to advise agents who are not yet "there" to turn down business. That it's fine for us fat & happy established agents to be selective about which clients we accept and which we don't, but for the average new-ish agent, being selective is simply not an option. After all, new agents NEED the practice; they NEED the experience, and perhaps most of all, they NEED those For Sale signs to generate calls from buyers.
Whoa, let's back up here a minute.
QUESTION: Under what circumstances does Loreena respectfully walk away from a listing? Hmmmmm?
ANSWER: She walks away because the seller refuses to do what Loreena knows needs to be done to experience a successful home sale.
Loreena knows what it will take to sell a home in her Frisco market. And presumably, that's what the seller wants and therefore, it's what Loreena wants to deliver. If the seller is going to stand in the way of that goal, Loreena feels duty-bound - both to herself and to the seller - NOT to acquiesce and allow the seller to fail.
That's her job. And she takes it seriously.
To allow a seller to call the shots - to "drive your bus" as Loreena calls it - is to neglect your fiduciary duty to your seller. Your personal needs for experience, practice and sign calls are not remotely relevant to your responsibility as a licensed real estate professional who is being considered for the honor of listing a home.
I have a friend with high blood pressure. When his doctor discovered it, he prescribed a blood-pressure-lowering drug. My friend balked, saying he didn't want to be on a prescription medication the rest of his life. The physician calmly replied "Well, then, that's your right, but I have to tell you that if you refuse treatment, I will no longer accept you as my patient. I feel that strongly that you take this drug for the sake of your health."
And guess what? My friend takes his medicine and is grateful his doctor respectfully insisted. We owe our sellers (and ourselves) the same respect, don't we?
Too many agents, brokers forget they don't own the home, or the seller either. The trust, balance is the relationship where together you get the property listed, marketed, sold. With adjustments along the way. Life is not always pat, simple and to have absolutes, everything black and white means no bend, flexibility. Cookie cutter listing process is a tad too mechanical. The wheels on the bus go round and round. Sometimes it is a case of musical brokers until the timing, circumstances change.
Great input Andrew. There are some listings I am not driving the bus and I can tell you it would have always been better not to take the listing.
It would be funny if the agents who took those listings were upfront with the sellers and told them why they were taking them. "Mr. Seller, I need some practice with listings and I need a few more signs in the area so I will hold my nose and take your over priced listing because it is what's good for me."
I think it is always best to know the sellers motivation...but always good to have some ground rules...I have a few that i am wishing I would n't have taken ....I knew they were over priced to start...and guess what...they are still over priced...and have not had any offers! Doesn't do anyone any good!
Absolutely! Despite this business being so friggin' "agent-centric" it makes you want to scream, it really IS about the clients. Period. We only THINK we are helping when we take overpriced listings and you know that is true when you justify it to yourself as "well, if I get a buyer out of it, it will be worth it."
No, it just isn't. It's not good for the seller and it's not good for the agent. THAT is what new agents need to practice. Be upfront and saying NO when applicable.
I think some of these overpriced listings are an ethics violation. We need more agents thinking that way.
Susan - you said that so well! The fact is that as soon as you take an overpriced (or otherwise unmarketable) listing, you have, on some level, assured the seller that you can, indeed, sell it. Doesn't matter how many disclosures or disclaimers you gave upfront - once the sign goes in the yard, you have taken the responsibility of selling it at whatever price and/or condition you took the listing at/in.
You're totally right- taking an overpriced listing is NOT serving your seller! What is so hard about that to understand???
Deborah - We've all done it and wish we hadn't, but maybe it's a rite of passage every new agent must go thru a time or two or three or four or a dozen before they finally say NO MORE. But again, it's NOT about us and our needs for training; it's about serving the seller who has honored us with his business...
Tim - Actually, if an agent would do that in this scenario, I'd be just fine with it! I did something similar a few years ago when a friend of mine had a short sale listing - I told her I'd never done one before, but she was at the point of truly not caring what happened to the house, so she just shrugged and told me to knock myself out learning about short sales on her house if I wanted to.
Chuck - what new agents don't always understand is that by being willing to walk away, they've just sent a powerful message to a seller of their commitment to doing a good job. Letting the seller "drive the bus" is NOT the right thing for either party.
Andrew - Good point. We always seem to want a system or formula that will work every time, but most of the time we need to stay flexible and play it by ear...
Hiring the Professional in the specific field you require is always the best recourse. It's not a designation you can purchase, others know it and will seek your expertise. Advice which has gone unheeded will inevitably cause the failure we won't admit to. REALTORS who can subscribe to Loreena's ability to "walk away" may just lift our level of professionalism to that of the Physician you described in your post. Thank you JA.
This prompted me to write a blog post here. A new-er agent has too many expenses already to take on the expense of marketing a listing that most likely won't sell.
D&D - I agree! It would go a long way toward giving us the credibility we so desperately crave.
Kevin - Very well said... and you're welcome.
I'm role playing here: So what if this rookie-agent takes the listing and gets a call from the sign:
Buyers who's serious in the neighborhood can tell if it's an overpriced listing.
What's the price of the house?
It's $XXXX.....
Isn't it a bit over-priced?
Yeah. But I can show you other homes in the neighborhood.
Now, what did the agent just do? Just to get buyers off that sign? It's unethical business practise if you ask me. I need to calm down now because I shouldn't raise my blood pressure. Geeesh
I learned this lesson the hard way. I have a seller right now that is on the bubble. Refusing to do what he needs to do to get his townhouse sold as he waits in vain for the bank who should be helping him with his shot sale to do something to help him.
I agree with Loreena but at the same time agent should do what they feel comfortable. If they are not going to get over the hump of letting go a listing let them learn the hard way or they may be just lucking that seller will come around and agree to work as a team.
Welcome Home!
Everybody and their brother wants to be an armchair real estate agent and like to believe they know what is in their best interest. We are in the trenches every day (hopefully we are) and if sellers or buyers are not willing to take constructive advice in the beginning, what will happen down the line. And in the end whose fault will it be - yours, they'll start the blame game, because after all you are the professional.
Knowing what's right though can certainly be hard to face though when times are tough.
Hi Jennifer,
Sadly, many people are simply using listings as buyers bait. There were several posts hanging around in partial response to my post on buyers bait that they have every right to take an overpriced listing in order to attract buyers. The premise for most of it was that they WERE truthful with the seller but the seller insisted on that price and they knew that if they didn't take it someone else would. And then their competition would have the listing carot that they needed to dangle in front of buyers.
The contention here is that they fulfilled their fiduciary duty to the seller by telling them the truth about what they felt it could sell for and that if they danced the dance they would eventually talk the seller into lowering the price. Around here listings are like pure gold. It's very, very hard to turn down a listing right now. Even top agents can have as few as 2-3 listings. So many agents are swallowing hard and takiing listings they know won't fly. Then they jawbone the seller down to a reasonable price over time. My problem with that right now is that pockets of our market are still depreciating. So this IS hurting the seller. In other pockets - time is on the seller's side. So it really all depends on where the listing is located.
I think also that some of this comes from the fact that brokers in some areas who have 50:50 splits with newbie agents help "support" the listing. What new agents don't realize is that the "support" generally is miniscule and generally there is no avoiding the agent having to pony up to maintain the listing. Some may not fully understand the risk factor.
Jennifer, life is too short to take over priced listings that won't sell quickly and to work with uncooperative sellers.
In my first year, I had a manager who told me, "Go ahead and take the listing anyway. We call those loss-leader-listings. At least you'll get calls from the sign!" I took the listing, didn't get a single call, and it expired. I also left that company after a year.
Fortunately, I now have a broker who's motto is, "No business is better than bad business". That may be a bit extreme, but you get the idea.
There's a company in Denver that encourages their agents to take any listing, at any price they can get it and then teaches them how to get a price reduction down the road. That's their strategy and it works - for the company. Their signs are everywhere. But the other agents know their stuff is always overpriced and I can't imagine how frustrating it must be for the agents who did as they were told and then have a bunch of overpriced houses they can't sell!
This is good advice. It really bugs me when I have an over priced listing that expires after I have tried getting ( and usually get) the seller to reduce the price. Then they relist with someone else at the price I told them and it sells. If I just don't take it over priced in the first place, I would avoid the aggravation.
Hi Jennifer,
Out of curiosity - how do their numbers look? The difficulty here is that this practice is rampant because so many buyers no insist on tracking down the listing agent. So agents working with buyers need to dangle carrots (buyers bait) in order to get a stream of buyers who think they can twist the listing agents arm into reducing commission for a double-sided deal. We only have one brokerage that specializes in buyers. They don't seem to be doing that well.
My point is that the tactic works financially - if it makes the phone ring with buyers. I think it is terribly unfair to the seller though.