Why would a Seattle Real Estate agent not list a house?
Recently I passed on following up with listing a house, why would I do that? The seller (a person I knew slightly) had a "Free" market analysis done of her house by an agent who farms that area. The seller, lets call her "Sarah", is thinking of moving to another state where property values are much lower, she can buy a new dream house, and invest in some rental properties.
The farming agent, lets call her "Kathy", has valued the property at least $75,000 more than I see the property selling for. Because of this value opinion, and what Sarah believes her net proceeds would be, she has already made an offer on some out of state property. A week prior to this she had called me to talk me about selling her house herself, I gave her some tips on how she could do it, and she said if it didn't work out she would ask me to list her house. I did not know about the other Comparative Market Analysis at the time.
Sarah called me a few days later about listing her house, she did not have time to sell it herself since she found a home that she loved and had sent earnest money with her offer. Sarah then told me about the "Free CMA" that Kathy done, the value given, she wanted my opinion and wanted me to list her house to sell. I said I would have to work up an analysis to see what I thought I could market her house for (I was thinking at that time the market value was too high) and we set up a time to meet.
We met at her house, and I talked about the importance of getting a house "market ready" to get the hightest price possible. Sarah said would not be able to do anything to get her house ready, because the business she runs out of her home takes up too much of her time. Sarah is also a collector of a wide manner of things, has many of them on display in her house, and stored in a packed garage. I was beginning to doubt if I could help Sarah to get the price she was counting on, especially since the home is dated, lacks some things buyers would expect in that price range, and she would not be able to get her house "market ready".
After analysing the market, I realized the highest price I could determine was at least $75,000 lower than Sarah was hoping for and had based her move on. I wanted to meet with Sarah to show her online what I saw, and what buyers and their agents would be seeing, but Sarah wanted to know the numbers then. When I told her she did not like them. I let Sarah know that I was fine with not listing her house, and that she should list with the other agent if she felt the other agent could get her that price.
We talked about it and I assured her that while I did not think Kathy could sell Sarah's house for that price, she should list it with Kathy because if Kathy was right and I was wrong, then Sarah gets the price she needs to move. If I am right and the house does not sell for that price, then I have not spent my time, effort and resources marketing a house at a value I don't have confidence in and more importantly lost a seller's confidence. Sarah waits another year or so until her house appreciates closer to the value she wants before selling, and spends the time getting her house more market ready.
I did not lobby to list this house because the seller had expectations of a higher value than I felt the house warranted. I did not want to be the agent who lost her seller's respect, and wasted her seller's time. I have learned that lesson the hard way, if I do not have the confidence in the value the seller expects their house to sell for, then I should not list it, it is not in my (potential) seller's best interests.
Deborah you did well! You have saved yourself time, effort and energy. You can spend those resources on other listings that will sell.
Rick
It's hard to take that posture, but it is worth it in the end. I always look at the hours saved as extra time to spend with my family.
Deborah - You did what all good professional agents should do in that kind of situation - thanks but no thanks when a seller has unrealistic expectations. Experience in the market and the business gives an agent the confidence and ability to do just what you did. For many, it is a hard thing to walk away from a listing, but if it's starting out based on unrealistic expectations, it will never be a win-win situation for anyone involved.
One of the courses I've recently taken talks about 'feeling free to return clients and/or potential clients to the marketplace'. You did just that, and likely saved yourself must wasted effort and energy that was put to better use working with realistic clients and on family time.
Great post and congrats on the gold star!
I have had similiar situations and applaud you. I commented on it in my active rain blog here.
I'm sure you will eventually get the listing when the seller gets realistic.
Let us all know.
Good job Deborah! I had a similar experience with my best friend. She is in a different state and called me to find out a good Realtor in the area she was in. I welcomed the opportunity for a referral. I contacted an agent who gave my friend and her husband a CMA of the neighborhood with a reasonable selling price. They nixed her after the other agent who "knew" more about the neighborhood told them they could get more. Almost a year later the home sold for exactly what my referral agent told them to expect. I am sad they had to spend an extra year of mortgage payments to learn that an accurate CMA is a powerful pricing tool used correctly by the best in the real estate industry.
We all want property values to go up. We all benefit from a higher priced sale. However, I am not hired to "list" a property. I am hired to market and sell a property.
Kudos Deborah!!
Good morning! Thank you all for stopping by!
Sharon - You're right, meeting a sellers expectations is a great reason too!
Rick - Thank you, I agree, my time and effort for other sellers (and potential ones) will not be absorbed by working to market a house that the market shows me I won't be able to find a buyer for.
Sarah - I do feel for the other "Sarah", we did discuss her options and they do work for her. She will list with the other agent at that higher price, if is doesn't sell at that price, then Sarah won't sell now because that is the price that pays off her mortgage, allows her to buy a dream home out of state and some investiment properties. Sarah will stay build more equity, spend (some) time on getting her home more market ready, and sell her house when the timing is better. I could be wrong about the price, and Sarah could be moving this spring/summer, or I could be right and Sarah waits for the magic of equity to build. Either way she is in a win/win situation. You (our Sarah!) are right that it is hard to hear something that is not what you were expecting.
Chris Elizabeth - That's a great way to look at it, more time to spend with family!
Jennifer - I did think about what you said about "reputation in the marketplace" and that isimportant. I am working very hard to establish myself as a knowledgable, credible real estate agent and making a mistake like this will not enhance that. I have made that mistake before, and I always learn from a hard lesson!
Ann - I got a "Gold Star"? Cool! Thank you, you are right, my time is better spent working with other clients, my business development, my friends & family and my new community here at AR!
Greg - Yes, you're right determining the motivation is important (more hard learned lessons!), in Sarah's case while she is motivated to sell (has an offer out of state) she won't if she can't get her price, she will wait for her house to appreciate. So she does not need to lower her price to sell, which makes her ultimately not a motivated seller.
Missy - Thank you! I will check out your post...a little later!
Ravi - Thanks! When the listing on Sarah's house expires, it will be done for a year or so until the equity on her house has gained enough to allow her to sell to achieve her next stage in homeownership.
Renee - Thanks! You are right, it was a challenging conversation!
Allison - Thanks! Yes, I have had the "bad experience"!
Michael- Thanks! I did not want to dissapoint Sarah if I was not able to do the job she wanted: marketing her house to sell at a price I did not feel the market would support.
Virginia - Thanks! Great story, and terrific statement: "I am not hired to "list" a property. I am hired to market and sell a property".
Thank you all for commenting...I am so glad to be here at Active Rain and participating with the community!
The bottom line is, agents that are taking too many overpriced listings are just tasking them because they need inventory and are hoping for the wish price, they saying what sellers want to hear, it ends up with the third realtor selling it at its true price or the first realtor finally gets them to keep droping the price.
Any realtor can take the listing at the price the seller believes it will sell.
I do not know how many times i refused to take a listing too high in the market, only to tell them it will sell for what i say it will, then they give it to another, they end up selling it for what i said it would when they get desperate.
I have may be 2 that are overpriced and it is only because if the seller drops the price, they will be upside down in the deal.
Deborah, great decision.
I had a similar lesson learned about 8 months ago. A husband and wife came into our office, and wanted me to list their home for sale. They were actually here from New York. The house was used as a rental. They had told me that the wife would be living in the house until it sold and the rest of the family would be going back to New York. Ok, so I think it needs to be priced right to sell.
After a walk through, it was obvious that she wasnt going to get what she wanted out of the house. We explained to her what the problems were that we saw, and the things we would definitely fix before putting the house on the market.
(Keep in mind she is an HGTV queen, and truly lives by what she sees there)
Needless to say, 8 months later the house is still on the market and they just now dropped the price $20,000!
I guess it probably didnt help that for the first 4 weeks there was no picture on MLS and then when it was put on there, it wasnt even of the right house! Can we say attention to detail?
Anyway, I am glad I didnt take on that headache. I do wonder though if she has really stayed away from her family that long.