This is a post I originally wrote years ago, but it is still applicable today. In this age of information, there really is no reason to overprice your property. You can get the job done in less than 30 days. Read on.
I'm sorry to have to admit that some of my colleagues flat out lie. I'm also sorry that this is such a long post, but it's a rather long story, and people got hurt in the process, PLUS the seller lost tens of thousands of dollars. No names are mentioned, rather it is a cautionary tale to sellers everywhere. This is an old post. I had so many responses to it, I've resurrected it after 5 years, because, well ... you've heard the saying "the fox changes his fur but never his habits". I'm about the let you in on some realtor secrets. Be advised, not all realtors lie. There are some good ones who approach their task with professionalism. Like any field of service, you have the good, the bad and well, the ugly.
Okay, so here below is the whole story; this is one in a series of my "soapbox moments".
SOAPBOX MOMENTS !
Last week I met with a local resident who wanted to sell his Rockland home. As usual, I did a very thorough "Market Trend" Market Analysis. These competitive market analysis usually takes me anywhere from 4-6 hours to prepare so that I have absolutely no doubt what the chances are of the seller's ability to sell his/her property. With adequate research it is possible to quite accurately predict how much time, (and within a few thousand dollars) the expected price point at which the property will sell.
There is an old saying that is a favorite of mine. Facts and Figures don't lie, but "people do". "Overpricing a listing is good for nobody," agrees Rick Landuyt, e-PRO®, an associate broker at Coldwell Banker Schweitzer Real Estate in Troy, Mich. I whole heatedly agree with his mindset. This is why I always come prepared when I meet with a potential client and show them what exactly is happening in the Rockland Real Estate market. Unfortunately, this poor seller did not listen to my advice . . . he called in another realtor, who no doubt puffed him up with whatever drivel sounded good to this naive seller. For some reason many people think if a realtor "thinks (or says) a property is worth "x" then the realtor can get that price. It's an old old strategy on the part of agents, and unfortunately the seller often times buys into it. So .... this seller "drank the kool-aid" and bought the big lie that "oh your property will sell very high because _________" blah blah blah.
Why would a broker take an overpriced listing anyway?
Mr. and Mrs. homeowner let me tell you a big secret that most real estate brokers won't tell you. The reason that they will take an overpriced listing, knowing full well that they don't' have a snowballs chance of selling it anywhere near the price they listed it as follows: You see, when the calls come in on that overpriced gorilla, the caller will exclaim "what are you crazy"... I don't even want to see that house. And all of a sudden that "realtor" will inform the caller that they do have other properties that are available in the price range they really want to see. BINGO! Goal accomplished. You were just used, Mr. Seller to help sell someone else's house. Is this ethical? Of course not! Is it done often. You bet!
So, let me state it another way. You, Mr.or Mrs. Overpriced Listing Seller person have just been used. But you didn't even know it. You just LOVED this realtor because they agreed with you that your property was worth what you knew it was worth all along. This scenario will play out over and over and over. Within a few weeks you WILL begin to realize that you were lied to. But now its too late because you signed a 6 month (or more) listing. The agent waxed eloquent about their marketing expertise and their database, and maybe even their market share or the size of their company with its their thousands of agents, but here your house sits ... lonely and waiting for some poor slob to come see it, let alone make an offer on it.
So . . . there you have it Mr. Overpriced Listing Seller .... this is why a realtor (who in my opinion is not even a realtor) would take an overpriced listing. I'm sick to death of the unprofessionalism I see day by day around me. It's been my soapbox for decades.
So, Mr./Mrs. Seller ... when we meet for my marketing presentation, I can tell you what you want to hear (wow your house is worth gold, when in my heart I know its not) or I can tell you the truth.
Why in the world would a qualified buyer want to waste his/her time and prance through an overpriced listing when there are other well priced properties offered?
In case you're thinking/wondering if the realtor "thinks" so highly of your property that you'll certainly have the chance to get more...think again . . . Even "if" a buyer did come through and offered you your inflated price, 97% of these properties are financed through a bank. Guess what Mr. Overpriced Listing Person .... you now have to get through the arduous task of the appraisal. The appraisers will use the very same criteria and statistics for their analysis as I do. At some point, you will hear the truth, but now it may be too late, for your once enthusiastic buyer will walk away. This is the stuff that real estate horror stories are made of, and our market is rife with them. And to make it worse, now your property is "aging" on the market and you will most certainly not get anything near your asking price.
So ... I think/hope you get my point. PLEASE if you are serious about selling your investment, PLEASE do business with someone who will tell you the truth and support that truth with facts and figures. Understand too, that I take my job very seriously, and I like to get paid. There is about 40 hours worth of work I must do before my listing (your property) goes live. If I knowingly take a listing at a price point which I know in my heart is not on point, it is very possible I have done all my work for nothing. Would you, Mr. Seller work for an entire week, let alone months for no pay?
Don't think I'm not tempted Mr. Seller to do what my competitors do . . . I'm human too. I have bills to pay . . .but I have something more important to maintain and that is INTEGRITY. I can put my head on the pillow every single night knowing that I've dealt honestly and in truth. And one final thought so you don't think I'm being too frank . . . none of this is really your fault, Mr. Overpriced Listing Property Person . . . why ???
YOU'VE BEEN LIED TO. You didn't know any different, because after all . . the realtor said it was so, and you believed them.
Oh...ps. I get asked quite often "how many listings do you have" . . . My answer is this. It's not how many listings do I have....how many do I not have? How many of my listings have sold, and how many of my listings expired unsold. My answer is just about every single one. There are a couple of exceptions to that ... those small exceptions, in each case are because the seller did not listen to pricing advice supported by facts and figures readily available to all. In the case mentioned above, the seller rewarded my honesty with choosing a realtor who lied to him. I, (like many sellers and agents gone before me) have had to learn to hard way . . . overpriced listings are a total waste of time, energy and money.
and p.s.s. - I must hasten to add that not all realtors conduct their business this way. The professional agents will, of course, layout the truth for their clients. Common sense tells us that business will not thrive in an environment of deception, and referrals will be nonexistent. And please (realtors) do not accuse me of "sour grapes" because I lost this listing. As you can see, I "lost" nothing, except 6 months worth of grief from a seller who did not heed my advice.
In closing I want to share with you what happened with this overpriced listing: And I should hasten to add that it was a very nice house indeed which, if properly marketed would have sold in less than 30 days.
June 20, 2008 - Listing taken
July 2, 2008 - still unsold
August 2, 2008 -still unsold - The sellers have now reduced their property by $90,000 and the property is STILL sitting there, and we are now in August, one of the slowest market times of the year, plus after that fast approaching the fall market leading up to the winter months (another slower time). The agent who listed that property so high did a grave disservice to the seller.
September 3, 2008 - The listing is still unsold
October 3, 2008 - Still unsold
November 3, 2008 - Still unsold
December 3, 2008 - Still unsold
February 12 2009 - Finally sold. It sold for $100,000 LESS than the original asking. The seller came down, down, down, down when in reality the comparables were there all along. In the interim the market went down down down. This seller was trying to "chase down the market" but he could not catch up with it.
And so, after all these years, I stand my ground. I can not tolerate lying realtors. They hurt the industry, the sellers and ultimately themselves when they lose the listings after months of work with no compensation.
The moral of the story: DO NOT OVERPRICE YOUR LISTING if you really want to sell within 30-60 days, or you will sit there.
That's the truth.
Angela Fish Chan
Licensed Real Estate Broker/Owner
Rockland County Real Estate, LLC.