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Posts Tagged ‘how to choose a real estate agent’

Every first of the month Ronnie, our administrative assistant, arrives at the office and begins the daunting task of addressing letters to several hundred homeowners whose listing expired at the end of the previous month. One of the good people who came off the market on November 30th called me and we met just this evening to see how I could help them sell. The details of why homes do not sell are not unfamiliar to me; price is certainly a big reason, but there are often other fatal mistakes the prior agent made that punctuate the home’s failure to sell. In this case, the home’s MLS data indicated as the size of the yard as “0 acres.” In other words, anyone who put the yard size in their search criteria would not find the house. Not good.

In discussing the options facing the home owners and what could be done to get the house sold, I was impressed with one of the seller’s concerns about the feelings of their prior agent. They didn’t get the job done, and they didn’t have my record in sales, but all the same she felt bad about letting them go after they tried so hard and were so nice.

I have to say, I wish more people cared about my feelings the way she cared for theirs. This is a woman with a good heart. I told her that this is business, not personal, but she was still kind of bummed about her old agent.

I wish there were more people like her. We spoke about it more, and the thing she acknowledged in our discussion was that it doesn’t take a cold and calculating person to make a smart business decision. You can still be a good person and do what is right in a business sense without being mercenary. Being good to people is important. That does not mean, however, that you subordinate your financial health and well being to appearing nice. If the right thing for her is to get a new, better broker, she owes it to herself to do so.

Selling a home is serious business. And it is not a vehicle for relationships. It is something some people do but once in their lives, and they owe it to themselves to have the best representation, even if their prior agents were cordial and nice. Huge money is involved, and there are no do-overs once a closing is over. I would say that all people should have a good agent, but good people especially deserve a good agent. I know of no other Westchester agent that sells more homes that previously expired with other brokers than myself. It is what we do, what we excel at, and how we grow the company in these rough times. When we do get started with this particular family, we’ll get them the results they very richly deserve.

 

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With the economy in decline and the housing market more so, real estate agents are leaving the industry. This is first and foremost a sad thing for anyone who loses a job or has a business fail; I never like to see anyone suffer or have financial problems. Overall, however, there is a silver lining to that cloud for the consumer and the licensees who remain active in the industry.

Not all, but a disconcertingly high percentage of the ex-agents should never have been agents in the first place. In the market run up from 2002-2005 we saw an unprecedented number of new and reactivated licensees enter the market to share the bounty. However, while the short term profit may have been favorable, we are still paying the price of the inexperience and, often, the negligence of practitioners who were able to outrun their mistakes in the irrational exuberance.

I remember well the calling cards of new agents who could hardly believe their good fortune at their involvement in a high-dollar transaction. Deals got screwed up left and right, but who cared? Another offer was a week away. And if you had a neophyte representing you in a purchase, it was never their fault your offer wasn’t accepted, you just lost a bidding war. We had people who never sold a house in their life collecting commissions on multimillion dollar sales like it was candy land. Just like the stock market spike of the late 90’s, many of people looked far smarter than they really were.

I know this because I am part of the cleanup crew. People listing their homes for sale today are horrified to discover that decks, finished basements or bathrooms they were told were legal at their purchase are, in fact not in compliance. Neither the last listing agent nor their buyer agent bothered to pull the property card, and the title company missed the detail in the rush of the time. I am in the midst of selling a property that last passed title in 2005 which has a submerged oil tank that would have failed a test in 1995, let alone now. It is costing my clients over $20,000. Twice in the past few months I have run across people who have excellent credit inexplicably stuck in high interest loans, most likely because a loan officer decided that profit superseded honesty. Where was their agent? Where was the advocacy? The list goes on, but I wish I had a dime for everyone who tells me that they regret using their newly licensed cousin or part-time aunt for their agent last time.

In each of these instances, an agent was paid handsomely. They did not earn that commission; it was monopoly money they used to buy homes and cars that they can no longer afford. In many cases they meant well, and their broker is responsible for the mistakes. We’ll never know in most cases, but our collective karma has caught up with the industry. Sadly, whatever price we bear is more than being shared by our clients who trusted us with their financial lives and were often hurt. We made our bed and now we are sleeping in it.

This brings us, of course, to today. One agent I know has his real estate website redirect to another endeavor. BMW’s have given way to Hyundai’s. An attorney told me recently that his biggest source of bankruptcy filings and short sales are real estate agents themselves. Enormous brokerage offices have rows of empty desks. And I am bombarded by solicitations for 2nd income opportunities from people who must know that agents are scrambling for income. Attorneys are actually thanking me for referrals.

But those of us who remain plying our trade have discovered a new environment: fresh air. It isn’t so noisy in here anymore. The overwhelming percentage of agents I am dealing with now are returning my phone calls and emails in a professional, timely manner. Oil tank tests, surveys and other due diligence are being handled in the beginning of transactions and not as part of a last minute scramble. Many agents are telling me how they remember the last decline in the late 80’s and how they coped. We are a profession again, not a pit stop for career nomads. We are conducting business, and even though the circumstances are worse, the process is civil and professional because the frosh and junior varsity are no longer clogging the field. And we know how to cope with the PR problems exacerbated by the “exes” because we always have.

Consumers now should have more confidence in the industry because by and large the pickers of low hanging fruit have left the market. Those who remain are survivors, fighters, and overall far more professional and experienced. They don’t pick apples with a broom and bucket; they know how to use a ladder. The drama may come from the outside, but far seldom from the agents themselves. It is for these reasons that I am glad the herd has thinned. I no longer have to sift through newbie’s to find a competent colleague. And these are people that know how to return a phone call, pull a property card, review a good faith estimate, and advocate for their clients. I’m not doing their work for them, or cleaning up their mess.

I salute the survivors, and I look forward to closing transactions with them. Together, we’ll help repair the damage done in the past decade and build the public’s confidence in the profession.

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In light of this postingon the Inman News Blog, here the few questions a home seller should ask of the prospective agent soliciting their business.

  1. Are you full time? (correct answer: yes)
  2. How long have you been in the business? (hint: you don’t want someone cutting their teeth on you)
  3. How many houses have you sold in the past 12 months?  (the more the better.)
  4. Can you provide me with references? (This can be tricky. Nobody wants their past clients inundated with calls from curious prospects, who can be time vampires. Recent thank-you notes are good)
  5. What will you do to market my house?

This has been said 1 million times and is worth repeating: it is the agent, not the company, that makes a difference in the sale of your home. Large companies have copious numbers of part-time, mediocre and/or fledgling licensees, so there is no guarantee that someone waving a big flag has much ammo. I admit some bias toward independent firms (I own one), but it is well founded, as technology allows us to do as much as the big outfits. The agent is the key. If you are talking to someone who is full time, has a proven track record, happy references and a marketing plan that makes sense, you are reducing your chances of being frustrated and waiting for the listing term to expire.

There are other questions you can ask, but these are the Big 5. I have been told by clients who hired me that they did so because of seemingly insignificant things I said that resonated. A few times I was told that I was hired because I mentioned that I am good at returning phone calls (they couldn’t reach their previous agent). People have chosen me because my marketing plan made sense to them. For example, if you own a farm in Dutchess County and you feel it would be a perfect 2nd home for a Manhattanite, you’ll be more likely to go for me if I am willing to pursue that kind of marketing (I am).  

 A few other points:

  • Never sign a contract longer than 4 or 6 months. Committing to a year is unnecessary and can make you a hostage.
  • Agents who tether their performance to their office, team, or company may be obfuscating their own low numbers or lack of experience. 
  • Print advertising is overrated. People look for homes on the Internet now.
  • Agents who promise a lower commission  rate than others have a low opinion of their services. You get what you pay for (please refer to Foxtons USA). There is a school of thought that says that higher commission can get you sold faster and for more money.

There is certainly more to say, and future posts will do so, but the above points are a good place to begin.

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