There was a blog a few days ago authored by Judy Cicalese entitled, How do you know when it's time to give up a listing? soliciting comments from us as to when is the time.
In too many instances, the time is before you even take the listing, especially in our present market. I'm located in the Greater Orlando market and we have a much healthier market than most areas of the country. We all want listings, but I don't understand why someone would take an overpriced listing just to have it languish on the market with your name rider on the yardarm. Yes, I do agree that exposure is great and that is what promotes us as realtors, but there is a limit. Don't you think that when people see your name on a yardarm for an extended period of time, that they won't question your efforts (marketing, etc.) as a realtor?
I've continually mentioned that to sell a home within a reasonable amount of time in this market, that you have to show 'Price & Value.' Yes, there are many more factors, and I know that Price & Value are not on the top of the list as reasons for consumers to purchase a home. I've always felt that for a home to sell it has to be sold twice. First to the realtor and then to the consumer. I rarely forward overpriced listings to my prospects, unless this home just totally suits their needs. There are too many other goods values out there. I don't have time to waste showing a listing where the owner needs a reality check.
I've been working with a prospective seller who wrote to me that she wanted to price her home high so that she has more room to come down in price. I viewed the home for her out of courtesy, since she is an absentee owner who bought the home for her children to attend college. Before I went out to this home I wrote her that there was a good chance that I would not take the listing due to what she wrote me. She understood that I might not wish to waste the excess time on her listing, but she did not understand there is a price to pay.
It costs us money for a listing - there is the yardarm, producing marketing materials, virtual tours, etc. There is also the possible future cost to us if that listing languished on the market for too long. Yes, your name may be remembered from people consistantly seeing it on the sign, but will they call you? Don't you think that there might be a negative connotation given to your name for being out there so long? Don't you think that people might infer that this may not be the realtor for me? You know that they will be wondering why that home was on the market too long. Some may know the reason, but how about all of the others that don't know the story behind it.
What I do when I take a listing that the seller wants to price somewhat higher than I feel is to write in the listing agreement that the home needs to be reduced to the price that I suggested in 2 weeks time. This, of course, is dependent on the amount of traffic, realtor feedback, etc.
I apologize if I may seem to negative to some here, but we are the professionals. Our industry, unfortunately, gets too much negative publicity. It is our job to educate the public.
How many times has it happened that you may have taken an overpriced listing and then was meek about calling the seller and telling them that you needed a Price Improvement? It's best to address that at the beginning. Why put yourself in that position?
Thanks again for allowing me to rant!
Best Regards to all.
Interesting. I just turned down a $2,400,000 listing about an hour ago.
Things to consider include the market, the degree of difficulty, the market, the seller, the market and finally, the market.
Amen and amen. There was a post this week that described an agent taking overpriced listings and I believe she called them PREDATORY LISTINGS.
Taking a listing at an excessively large price harms not only the seller and the agent, but everyone else who has to work in that area.
I agree with everything said. I can't count how many times, in the recent market, I've coached my agents that simply taking a listing so you can capture market leads is simply a HUGE mistake! There's a fallacy out there that a for sale sign in a yard, no matter how overpriced, is somehow good for th real estate agent. I remind them that not only is this not good for them, it could be a violation of the REALTOR Code of Ethics. Sometimes that puts the fear of God in them enough to realize the error of their thinking.
Great post!
I went to a listing appointment not too long ago where I was at $425,000 and thought that was a bit high. I was competing for the listing where many agents buy the listings, but felt that it would still sell at that price. I didnt get the listing. Was I upset? No!!! The agent who got the listing priced the house at $595,000. He can have it!
It was cancelled on the March 23rd, 258 days later.
Many realtors need to learn how to tell the client what is hard and necessary not just what the client wants to hear. They don't need a "yesman!" They need a professional to tell them what price the market will generate for their property. Even if you don't get the listing you will get something worth a ton more...Respect!
They will never tell after they list with someone else and reduce the price 5 times and a year later that you were right, but they will remember.
In the current market, we turn down more listings than we accept. Why? The owners
Hi Marc,
First I ask the Seller when do they want their home Sold by? Then we go over the stats inducting the average time to sell and home, usually 60 days, with another 60 days for closing, that adds up to 120 days or 4 months..This helps the Seller understand that Over pricing may delay the Closing date. Ask them if they want to Sell the Home or just list it, and explain the difference.
Cheers, have an awesome day!
Fred Carver www.fredcarver.com
Yep, there is OUR cost as the agent - the tangible (marketing, etc.) and the less tangible (our reputation). But there is a huge potential cost to the seller - money they lose every day the home is on the market (mortgage, utilities, insurance), and the likely drop in price with the increased marketing time, so they get less than they would have if priced correctly from the get go. Duh!
Good post.
Jeff
Many agents "buy" listings in my market place. Even the experienced agents do. They do it because they rely on their skills to "beat up" the seller on the price during the listing. Me personally, don't have the mental energy to do this.
I can't help think, if as the professional, we do a market analysis, price and list the home, isn't asking for the reduction a reflection on OUR abilities to price it from the beginning.
Marc - Great post. When a lisiting is taken (especially in your farm), you future sellers will know if you sell houses in a short period of time or over months of time. If a listing is taken despite of condition or inflated price, your reputation "track record" is on the line.
Great advice!
James