Promises, Promises. How About Guarantees?


One of my colleagues recently spoke of losing a listing opportunity to another agent, and when they asked the homeowner what persuaded them to go elsewhere, the answer that was given was the promise of a higher selling price . . . not a lower commission rate. Now, for those of us bound by the laws of gravity, and even more importantly, the laws of supply and demand, the promise of a higher selling price was the equivalent of telling the seller that they could defy the laws of the marketplace.

My colleague was not going to challenge the seller’s decision, and simply thanked them for disclosing the reason for going with the other agent. I, on the other hand, would have been seriously tempted (yes, only TEMPTED) to ask “Is this agent GUARANTEEING you that higher selling price?”, because, let’s face it, talk is cheap. Of course the agent couldn’t guarantee a selling price, but in this case, the disparity between the listed price and the comps was impossible to defend other than to attribute it to an impressive case of sheer guile on the part of the listing agent. The laws of gravity can be very inconvenient at times, however, that doesn’t mean that we can defy them, and the same applies to the housing market. An agent who has prepared a well-crafted Comparative Market Analysis will have one of the best tools for converging on a reasonable expectation of a home’s selling price – – not a guarantee, but a reasonable expectation. Keep in mind that a properly staged home has a much better chance of realizing a higher selling price than one which has not been critically analyzed for eye appeal and flow. Clutter can be costly; presentation wins the day!

Every seller would like their home to be the subject of a bidding war to maximize selling price, and every buyer would like to find a beachfront mansion for the cost of a rural tool shed, however, with the amount of information available today, neither scenario is terribly likely. Keep in mind that both overpricing and underpricing carry risks, so a market supportable price should always be the goal. An overpriced home may be overlooked because its price exceeds similar homes in the area, and an underpriced home invites suspicion that expensive repairs (or eccentric neighbors) may lurk out of sight, even if you’ve had a licensed inspector go over the subject home.

If you want more for your home than other similar offerings, you may be able to get it by stepping up the “WOW” factor. Your real estate sales agent is a professional, and they can provide you with ideas and proven techniques for maximizing the “WOW” factor of your home. More “WOW” factor can translate to higher offers. While a successful real estate transaction is generally viewed as a meeting of minds and wallets, value is still a judgement, not an absolute, and higher perceived value has a higher likelihood of translating into more dollars for the seller.

If I may be of service to you, I invite you to call, text message or e-mail me at your convenience. Have a great summer!

Naked In The Real Estate Jungle

moss-2I recently received a lead on a potential home buyer, and as is my customary practice, I promptly placed a phone call to not only introduce myself, but also to verify the accuracy of the narrative in the lead. If the information is correct and they are not already represented, I ask the prospect if I may be of service to them. Not surprisingly, this particular call went to voicemail, and I recited an oft-rehearsed introduction with an invitation to call me. An introductory e-mail went out immediately, briefly touching on how my background and commitment to outstanding service might help them realize their real estate goals.

This morning, I found a response to my inquiry in my Inbox, reproduced here: “The house I want is not listed and be sold directly to me without a bunch of costs. Thanks. Xxxxxx” (Xxxxxx being the prospect’s first name – – which I will not print here, but a name which also did NOT match the information initially provided to me).

If you or I walked into a professional’s office, let’s say a neurosurgeon, and said “Well, performing surgery on my back will take you about an hour and require about $1,000 in supplies and medication. How about doing the surgery for $1500? That way, you’ll make $500 for that hour, and I won’t have to pay for all those costs that everyone else pays.”, how quickly do you think that surgeon is going to set an appointment for your $1500 back surgery? (If your answer is “the 12th of never at 2:00AM sharp”, you can move on to the bonus round. Their response would likely be unprintable here.) To put their response into perspective, my back surgery in 2008 was billed at over $40,000, and I can assure you, I didn’t have any heart-to-heart conversation with my surgeon about doing the work at cost.

The old joke that real estate agents are often rated only a notch above toothy-grin cigar-chomping checkered sportcoat-wearing used car salesmen carries a sting of reality at times, and while I like to think that I have a thick skin, sometimes this dismissive treatment of those of us in the real estate business actually hurts. This arena in which we operate was not created by $49 correspondence school courses and hour long infomercials, and consider this: It is a highly regulated profession in which nearly every governing authority in existence, Federal, State, County, Local, DBPR, EPA, DEC, DOJ, etc., has a hand . . . . but all of it for the CONSUMERS’ BENEFIT, so where is the disconnect?!? Oversight is a good thing when it serves to reduce bad behavior in the industry, and it should boost people’s perception of the industry as being one of professional service by trained and qualified individuals overseen by guardians of the public’s best interests.

Whether buyer or a seller, there are going to be costs, and the lack of a real estate professional on your side of the transaction doesn’t eliminate those costs. In point of fact, what you may appear to save by working without a real estate professional may be outweighed by surprise costs for which a real estate professional could have prepared you. Worse than that, however, would be paying too much for a home because you didn’t have a real estate professional provide you with a well-crafted Comparative Market Analysis. A house is usually the largest single investment that anyone makes in a lifetime. Would you let your favorite meat market butcher perform a heart transplant just because they are good with a knife and would do the work for half the price of a trained heart surgeon? Of course not. And if you were falsely accused of murdering someone, would you want a fresh-faced 22-year old law student defending you in a murder trial? Ridiculous, right?

Real estate agents are trained professionals, having accumulated a body of knowledge, demonstrated familiarity and mastery of the skills necessary to navigate the thorny path of home buying and selling, and ready to use the experience gained in every transaction to benefit the next customer. Those who have come from different backgrounds often bring with them additional skills and talents, which also benefit their customer. And while you may see a multi-thousand dollar commission as a lot of money for a 1-hour long closing on a home, that skilled individual will have certainly invested several dozen hours in the weeks and months leading up to the closing, they will have paid for licenses required to do business, attended continuing education seminars and classes, and consulted with their broker on trends and new developments in the industry. In addition, they will have incurred many costly expenses to conduct real estate business such as broker fees, business insurance, costs of computer software and supplies, sales and marketing resources, and automobile expenses. Television’s portrayal of real estate sales as simply a part time job conducted from a room in their home with a phone and a computer is the equivalent of a grade school play held on a gymnasium stage with cardboard scenery. The real world of real estate is exponentially more complex than television’s simplified illusion.

Many years ago, a college accounting professor of mine was fond of saying “It’s a jungle out there!”, frequently reminding us that the working world is a dangerous place. He was a very wise man, and I’ve never forgotten his words. But in the jungle of real estate, a real estate professional is the equivalent of a consumer’s tour guide of the jungle, helping to keep them safe, and assisting in navigating the often-complicated terrain.