Thinking of Selling your Home Don’t Believe the Hype When Hiring a Realtor to Represent You
Just peruse through the Sunday newspaper, real estate books or scan various Realtor websites and you will see alot of hype.
Real estate is a cutt thoat, competitive industry. Realtors are always trying to find new ways to attract home buyers and sellers. With so many to choose from Realtors are constantly trying to make themselves stand out from the crowd. With this desire to be different we naturally create alot of hype.
Let’s go through a few of the more common ways Realtors try to grab your attention.
Largest Producer!
People should be impressed by any agent that is the largest producer. Right? What if that Realtor is in a 2 or 3 agent office? It is not as impressive anymore. What if the agent was the largest producer for just one week? They don’t advertise that information. Again, not as quite as impressive. Most people just assume that the agent is the either the largest producer ever or for atleast a long period of time like a year.
If we don’t sell your home we will buy it!
Are these Realtors so confident in their ability to sell your home that they will buy it if it does not sell? Not really. If you read through the details you will see that the chances of the Realtor buying your home are slim to none. Most of the agents who advertise this have never bought one of their client’s homes. In order for the agent to purchase your home there are usually numerous requirements such as them buying your home for the appraised value minus various costs like financing and marketing (broker commissions) fees. In the end, it does not make much sense for the home owner to sell to the Realtor.
Your home sold in 30 days or we will sell it for free!
This one is similar to the above hyped program. Typically, there is a list of things the homeowner would have to do to get the Realtor to sell his house without a commission. In reality, it rarely happens. Typically, the Realtor requires that the homeowner price the property at a value given by an appraiser or by the real estate agent. Other requirements may be:
If the homeowner does not perform on any these tasks then the Realtor would not be required to sell the home free. There are all kinds of caveats that the agent can have to get them out of selling your home for free. Some of them are very entertaining.
We will advertise your home until it is sold!
Most Realtors will do this one without too many caveats. Most agents know that advertising rarely sells a home. A very small percentage of people buy the home they originally called on. The main purpose of advertising by a Realtor is not to sell your house directly. Advertising generates phone calls and some of those people become clients of the Realtor. Over time this builds up a list of home buyers looking for property. Another reason Realtors like to advertise is to get future listings. People thinking about selling will usually interview agents that advertise heavily. So when an agent tells you how much they plan to advertise your home keep in mind that most of that advertising benefits the Realtor and not your house.
We guarantee to save you $5,000 on your next home purchase!
Most home sellers have a built in cushion in their asking price. Here in Sarasota, Florida on the average a home will sell for about 97% of list price. If I sell a home for $350,000 chances are that the home was listed for $360,000 - $365,000. In this situation it would be pretty easy for the selling agent to say he saved his buyer $10,000 - $15,000. Was the agent such a shrewd negotiator that he got the seller to drop his price? Most likely not. The seller probably just factored a 3-5% cushion into their asking price.
In many instances, especially in hot markets, homes sell at or above their asking price. Most Realtors who advertise these guarantees either give you something small such as a home warranty or a some other type of buyer credit if they do not help you negotiate a lower price.
We will sell your home for 1% 2% or 3%!
This is another hook that Realtors use to attract home sellers. Usually this 1% 2% or 3% is the listing agent’s fee for selling your home but it does not include any co-broke fees.
Depending on the market, sellers will list their home anywhere from 5%-7%. What happens now is that the listing agents goes to the Realtor community via the Multiple Listing Service (MLS) and offers a co-broke fee (usually 3% or half of the total commission). If the other agent brings the buyer he is paid the co-broke fee. The majority of real estate transaction involve 2 Realtors. Therfore, the 6% total commission is split between the two agents. Often times when an agent advertises 1% 2% or 3% they are only advertising their fee but the commission goes up if you want your house listed on the MLS. Most of the time it is crucial to have your home listed on the MLS.
#1 Real Estate Agent!
#1 at what? Are they the absolute best Realtor in the world? Have they sold the most real estate? Are they always the biggest producer? Did they sell the most homes last week, last month, last year?
I see Realtors throw this one around alot. Any real estate agent can #1 at something on any given day. There are so many statistics in this industry that it would be pretty hard not to find an agent to be #1 at something. I think agents use this one because it tends to grab people’s attention more.
I think it is normal to see this type of marketing in a highly competitive industry. I feel it is the nature of the business and there is nothing wrong with it. Many successful agents have used or are currently using these marketing ideas. When looking to find an real estate remember not everything is as it seems.
Marc Rasmussen is a Realtor in
Sarasota, Florida. He works with mostly second home buyers for Sarasota,
Siesta Key and Longboat Key.