What is your barrier to setting expectations?

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I think REALTORS have got it… “it” being the connection between current market trends and the need to set reasonable expectations.  The REALTOR seems to know that they are in for the long haul when taking a listing.  I am not sure that brokers and educators are doing a good job of equipping the REALTOR with what they need, to set the seller’s expectations.  Knowing the connection and relaying it to the consumer are two different skill sets.

My wife is a REALTOR and recently she has prepared two market analysis for indvidiuals wanting to sell for lifestyle upgrades.  It’s interesting to me that these sellers haven’t “gotten the memo”.  It’s a buyer’s market.  In the county where we live, in December there were 399 homes for sale and only seven went under contract.  In this same county these folks are asking to get substantially more for their homes than ANYTHING that has sold in the past year. 

I have recently gotten information from a Zillow.com survey that was done.  What was reported in the Real Estate Intelligence Report was of great interest to me.  Zillow reported that 77 percent of Americans do not believe that the value of their home has declined.  34 percent advised that they were going to try and sell their home….this year. 

Wow!  Someone really hasn’t been listening.  For a generation of REALTORS, we’ve been saying that it’s location, location, location; but isn’t that just if there are actually buyers looking?  I think it’s important to remind the seller that it’s price, price, price.  It doesn’t matter where you’re home is located in this current market if it’s overpriced, not compared to the appraisal the received a year ago, but in comparision to the other competition.  Let’s not forget, that even if it is priced well, the chance that a buyer is going offer full price is pretty slim in a lot of cases.

I’m sure that it’s not everywhere, but in plannig district 16 it’s a tough market.  It’s time that we frankly tell your seller just that.  Setting a reasonable level of expectation will help you and the seller sell the home.  It’s the REALTOR’s obligation to sell the home – not simply generate more listings.  I recently spoke to a listing agent complaining that her clients were calling her almost daily upset that there had been no activity on the house.  When I asked about the price point, she replied that it’s very overpriced and was when she took the listing.  She simply took it, so that she could get a sign up to generate more listings.

I have to ask… is the pain and suffering of dealing with a unreasonable seller, in a home that has no chance of selling worth the “free” marketing that you can get.  I would think a busness analysis would probably not relfect that ideology.

A marketing strategy employed by some other practitioners has been to find out who else the seller is interviewing and show the seller the “success rate” of that other agent jockeying for the listing.  If you are an agent who takes every listing, it’ll be pretty easy for these “success rate” agents to show the seller that you’ve failed in selling the listing more than you’ve succeeded. 

Whereas there may be many barriers to agents giving the sellers the hard facts about what’s going on, it’s still your ethical duty to let them know if they are off target.  It’ll save both you and them a lot of headaches in the long run.  As a buisness decision, every REALTOR should know their walk-away point.  You should be able to articulate to the seller why you can help them, and why as a professional you have to give them the tough news.

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5 Responses to What is your barrier to setting expectations?

  1. Kim Wood says:

    It took me a while to learn this. When I was new I wanted to take everything I got – but all I ended up getting was LOST money on those listings that weren’t realistic! I try the best I can to talk the reality into sellers (and buyers) but often their ears won’t listen.

  2. Jeremy Hart says:

    I agree, with both Kim and you, Matt. I guess if you throw enough spaghetti against the wall that something will stick, but right now in a lot of areas NOTHING is sticking. You’re exactly right – our obligation is to sell the home we’re marketing. Sure, we can market multiple homes in multiple ways, but maybe it’s not just about numbers. It should be about results.

    Buyers and sellers need to have a realistic look at the market, but so do agents. Be honest up front …

  3. Julie Emery says:

    I can’t count the number of listing appointments I’ve gone on where competing real estate agents have made no attempt to give the sellers realistic information about the current market. I spoke with another agent yesterday who had gone on a listing appt and was told that her competition had not given them any indication of market value, merely asked what they wanted to list the house at.
    There are plenty of agents that will take any listing, regardless of how overpriced. It’s an interesting business model, but I agree that it’s ethically flawed if you’re not giving your clients a real picture of what to expect in this market!

  4. Tony Arko says:

    The problem exists not with agents taking over priced listing but in the business model of real estate industry. If real estate agents would only value their time and effort like most true professionals, they wouldn’t be willing to do things for free. But we know deep down inside that if we can only sell one of these over priced listings, or get one realistic seller from the over priced listing, or get one buyer off the sign call, we could collect our ridiculously over priced commission and all will be well.

    If you have any self worth as a professional, do what I do, charge them up front for the privilege of listing. Then charge a reasonable commission rate on top of that. Imagine not having to charge 2 or 3 times as much as you should for a successful sale, just to make up for all the people that waste your time.

  5. Rick Linhart says:

    Cleveland City of Light City of Magic”
    Randy Newman
    I have been appraising properties in Cleveland for 30 years. If the house is in the “City” proper and has been mortgaged in the last 5 years, 90% of the time the value of the property is most likely 30% less then the mortgage amount.

    Rick Linhart
    Certified General Appraiser
    Member of the Unified Appraisers Guild. Local 17

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