The Chicago Real Estate Minute

Seller myths: How to fail, conclusion

8 minute read

The con­clu­sion on seller myths is about the false beliefs often held about realtors, and about real estate marketing. These often unspoken thoughts a seller may just assume are the case, but the opposite is actually true.

Please read the prior post about seller myths here.

Thinking all realtors are the same

Image by Arek Socha from Pixabay

Nothing is further from the truth than this. A home is usually a person’s most valuable asset. Trusting the sale of it to someone that doesn’t deserve it only costs the most important person — you.

Most people know more than one realtor, they know several. They probably don’t give it much thought when they’re happily settled and not thinking about moving. But when they are, concerns about who to work with or how their friend­ship or social circle might be affected can cause many a seller to make the dreadful decision of working with the wrong agent.

Will that old college friend who’s sold a few houses in the past five years reimburse you for the many thousands of dollars their lack of expe­ri­ence will likely cost you? Does that sorority sister who really needs a sale strike you as a fierce nego­tia­tor? Speaking of costing you, any friend­ship is likely to sour if they fumble the ball unsuc­cess­ful­ly attempt­ing to help you sell.

Regardless of the agent or how you know them, ask serious questions and make sure they know that this is a business decision you are making, and not personal. Ask as many questions as needed, such as:

Image by TeroVesalainen from Pixabay
  • Valuation
    • What is your process of putting a home eval­u­a­tion together?
    • How do you determine what comps to use?
    • How do you evaluate trends?
    • What other market metrics do you use?
  • Track record
    • How long have you been a full-time agent?
    • What is your average sale-to-list ratio %?
    • What is your average market time?
    • What is your average selling price?
    • What % of your listings actually sell?
    • Based on your track record, why should I work with you?
  • Communication
    • How will you com­mu­ni­cate with me about showings?
    • How do you get feedback
    • How often will you give me a detailed report on the market?
  • Before going on the market
    • What do you do to help us get ready to go on the market?
    • How do you coör­di­nate the pho­tographs & marketing materials?
    • What agent-to-agent marketing do you do?
    • What do you do that other agents don’t do?
  • While on the market
    • How are showing requests handled?
    • How are showings handled?
    • Will I be notified of every showing request?
    • Do requests come straight to me, or to you first, and you’ll reach out to me? Why not to me first?
  • During nego­ti­a­tions
    • How will you let us know of an offer?
    • What’s your process for nego­ti­at­ing?
    • Why should I think you’re the best person to negotiate on my behalf?
  • After going under contract
    • What’s your process for keeping a deal together?
    • How is the inspec­tion handled?
    • How are you involved during attorney review?
    • How are you checking on the buyer’s loan?
    • How are you helping us to be ready to close?

Overpromising by agents doesn’t occur

This is one of the practices I hate to see in my industry. Some agents, desperate to get a listing signed, will inten­tion­al­ly tell a seller that a home is worth more than it is so the seller will decide to work with them. It cheapens us as agents and does the seller no good.

The practice is known in the biz as “buying the listing”. The agent says it’s worth more than it is in order to get the listing signed, much as Pinnochio would do if he were a realtor. Then when it doesn’t sell (because it’s priced too high), the agent goes to the sellers and tells them to reduce their price sub­stan­tial­ly.

Sellers may think that the agent who gives the highest list price must believe in the home the most. Sorry, Charlie. Ask them if they can ratio­nal­ly defend that listing price to you on the spot — if they can’t, what possible chance do you think they have in doing so if (and that’s a big “if”) an offer does come in? Worse yet, they may just be guessing — in which case, they’re always going to round up in hopes the sellers are deciding strictly on price.

Sellers often don’t realize that they are under­min­ing their own nego­ti­at­ing position. If a lower offer does come in, the comps will likely support the lower price and not their list price. These agents, who probably don’t have the stomach or the fortitude to tell their clients the truth, will bark at the buyer’s agent to raise their offer (without the comps to support it) since they’ve convinced their own client it’s worth more. By that time, their seller is likely already pretty annoyed with their own agent anyway.

Recommendation: trust but verify. I go into every listing valuation knowing exactly what I will recommend and why, which I can readily explain on the spot. Don’t trust any agent who can’t do the same.

#16: Unusual marketing helps homes sell

Marketing is a very important part of the selling process. An expe­ri­enced and knowl­edge­able agent will have a proven track record of success in marketing homes, and also in actually getting them sold. Ask as many questions as necessary to under­stand how they achieve the results they do.

Image by Steve Buissinne from Pixabay

Want to know what doesn’t sell a home? Fancypants full-page ads in a glossy magazine or local newspaper. Those ads are done for branding purposes, not to get the home mentioned sold. If you think I’m wrong, try this: open to a full-page ad for a home for sale, glance at it for five seconds, then put it down. What do you remember? The brokerage or the agent — but rarely the home itself.

There are proven ways to get home sold through marketing. I have a multi-layered process of doing so that has repeat­ed­ly worked for my clients time and time again. I have sold a $4M home outside the MLS solely based on my marketing efforts without any print adver­tis­ing, so it can be done.

Sellers in the highest price brackets in any market will sometimes think that over-the-top adver­tis­ing is needed. Luxury agents who crave the limelight will often enable this thinking because it allows them to bask in the glow of their own nar­cis­sis­tic self-image, even if it per­son­al­ly costs them thousands of dollars. Here’s what is needed: an agent who knows what to do to get a home sold regard­less of price range, under­stands how to interpret the market, and has the backbone to tell their clients the truth.

Agents who advertise in magazines and news­pa­pers want to hoodwink their sellers into believing that they’re marketing a seller’s home, but in reality, they’re just selling them­selves. It’s about as effective as standing on the sidewalk with a sandwich board. Marketing is important no doubt, but homes sell based on the following: pricing, staging, condition, finishes, and location.

A higher level of marketing? More inef­fi­cient, inef­fec­tive and expensive marketing does not help an over­priced home sell.

Final Word on Seller Myths

There are numerous myths out there, and all can cause dis­as­trous results if the seller believes them. Do yourself a favor — under­stand what they are, and disregard them!

To view the first post on Seller Myths, click here.

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