Make More Listing with an Agent

Should you hire a real estate agent when selling a home? During any recent sellers’ market, there are many home sellers who opt to sell their home “for sale by owner” (also known as FSBO). The recent sellers’ market is no exception. Many home sellers sold FSBO with the perception of saving money by not paying a real estate agent commission. But did they really save money? Can you make more listing with an agent?

make more listing with an agent
Hire a seasoned professional real estate agent

Over forty years ago, it was theorized that technology would replace many service professionals. Over time, the prediction manifested. However, the exception has been real estate agents. The role of the real estate agent has and continues to evolve. Real estate agents continue to demonstrate their value, and provide a valuable service.

Seasoned real estate agents are sales and marketing specialists. Experienced agents understand the market and use home sale data to determine a price, as well as suggesting when to list your home. Professional agents can suggest how to prepare and present your home to attract potential home buyers.

Regardless, there are many home sellers who feel they are saving money by selling without an agent (including those who sell to investors). Nonetheless there’s a body of research that has demonstrated that hiring a seasoned professional real estate agent yields a higher sales price and shorter time on the market. And a recent study reveals that selling your home FSBO could actually cost you.

Can you make more listing with an agent ?

Research by Miller, Sanchez, Sklarz, and Vamosiu investigated price differentials in FSBO and agent listed home sales (Saving Real Estate Commissions at Any Price: Does Having a Real Estate Agent Influence the Sales Price of a Home?; Journal of Housing Research, 2021, vol 30, no 2). They point out that although MLS premiums are no longer a factor, the study indicated that FSBOs sold for significantly lower sale prices than agent listed home sales. However, the amount of price differential depends on the type of home and region.

If you’re planning a home sale. Hire a professional for a smooth transaction with little drama. However, if you’re leaning toward a FSBO sale, consider all the factors. Although it may seem easy to sell a home on your own, the idiom “the devil is in the details” holds true. Even in a sellers’ market, when home buyers are competing for homes, you could be losing out if you’re unable to procure, manage and negotiate multiple offers prudently.

By Dan Krell
Copyright © 2023

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Disclaimer. This article is not intended to provide nor should it be relied upon for legal and financial advice. Readers should not rely solely on the information contained herein, as it does not purport to be comprehensive or render specific advice. Readers should consult with an attorney regarding local real estate laws and customs as they vary by state and jurisdiction. Using this article without permission is a violation of copyright laws.

Real estate agents have a role

real estate agents have a role
hire a professional

Last year, at the height of the latest sellers’ market, I talked to a friend about selling his property. He gleefully quipped “Haven’t you heard? Nobody uses a real estate agent anymore [to sell a home].” To be honest, I hear that every seller’s market…and it’s a false statement.  In fact, most home sellers hire a real estate agent to sell or buy a home. So, in response I asserted that Real estate agents have a role in the real estate transaction.

The National Association of Realtors’ 2021 Profile of Homebuyers and Sellers indicated that 90 percent of home sellers hired a real estate agent.  The reasons for hiring an agent to list your home apply in any market, and include assisting you to set the list price, to prepare the home, and to facilitate the sale process.

Setting the right sale price is important in any market. During a sellers’ market, it may be tempting to set a high sale price. But the fact is that you can still turn off home buyers with an unrealistic price.  A real-life example comes from a listing appointment I had last year.  The seller was disappointed in the price range I suggested for her home (her home was smaller than other homes in the neighborhood). She was clearly dissatisfied with what I shared and said, “In this market, all homes sell for more than the last one that sold.” This is also a false statement. In a market where homes sold on average 7 days, she wasted 30 days on the market only to sell for a price that was in the range I suggested based on comps and adjustments.

Home preparation is also a key factor in any market. Home preparation entails decluttering, staging and sometimes repairs.  Let’s face it, the better the home presents, the quicker it sells. In a seller’s market, a well-prepared home can elicit a bidding war, raising the sale price above list price. 

Hiring a real estate agent is not for everyone.  But the stats revealed by NAR’s 2021 Profile of Homebuyers and Sellers indicate that real estate agents have a role in the real estate transaction. Real estate agents are housing-market experts, recognizing and anticipating trends.  Agents can provide detailed market analyses to assist in formulating a home’s listing or sale price.

Furthermore, from the time your home is listed to the day of settlement, agents are facilitating the transaction. Starting with marketing your home, the agent will work to procure offers on your home and assist in negotiation. They will also assist in helping completing the sales contract and follow up on contingencies. They will also work alongside other professionals to ensure any bumps in the journey to settlement are worked out.

By Dan Krell
Copyright © 2022

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Disclaimer. This article is not intended to provide nor should it be relied upon for legal and financial advice. Readers should not rely solely on the information contained herein, as it does not purport to be comprehensive or render specific advice. Readers should consult with an attorney regarding local real estate laws and customs as they vary by state and jurisdiction. Using this article without permission is a violation of copyright laws.

Back to the future for residential real estate

If you consider the roots of brokerage in residential real estate, you can imagine how much the business of selling homes has changed.  Unlike today, the first real estate brokers were independent. Their “listings” were exclusive and proprietary.  Buyer agents didn’t exist until well over one hundred years later.  And at the beginning, there was no broker cooperation on listings and commissions. 

Real Estate
Real estate consistently voted as best investment

Of course, everything changes over time. Brokerage cooperation began with loose networks of brokers who agreed to help sell each other’s listings.  Early multiple listing services evolved out of those local networks.  And as the real estate industry adopted emerging technologies, the MLS concept evolved into the listing service we know today. 

The MLS framework promoted the evolution of real estate brokerage as well.  Centralizing and standardizing listed homes made home searching easier for brokers and their respective buyers. 

Brokerage cooperation allowed agents and brokers to sell others’ listings to buyers.  Up until the early 1990’s, all agents and brokers represented the home seller.  However, it’s likely technology and a robust MLS fostered buyer agency and dual agency. 

It seems as if it wasn’t until the advent of buyer agency when people began questioning agency and compensation.  Prior to buyer agency, the commission was negotiated between the listing broker and the home seller.  Selling agents (those who brought the buyer) were a subagent of the seller, so it made sense that the commission would be shared with subagents. 

The commission structure of today’s listing agreements seems to be an antiquated carryover, where commissions are “shared” with sub agents and exclusive buyer agents. 

As an aside, it’s common, if not required, for a buyer agent to disclose to their clients their compensation amount. If the coop commission is less, they will likely collect it from their client.

Currently, real estate agent and broker compensation is undergoing a meticulous and exacting scrutiny inside and outside of the industry.  During the last two decades, there have been legal challenges to the industry’s status quo on residential agent and broker compensation.  However, recent legal proceedings have gained traction such that a growing number of real estate brokers are embracing a possible future with “decoupled” commission.

When change is afoot in the housing industry, there is a lot at stake for real estate brokerages.  Although the outcome to the current challenges of real estate compensation is uncertain, the result may be that residential real estate brokerage comes full circle, where buyer and seller compensation are respectively exclusive.

By Dan Krell
Copyright © 2022

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Disclaimer. This article is not intended to provide nor should it be relied upon for legal and financial advice. Readers should not rely solely on the information contained herein, as it does not purport to be comprehensive or render specific advice. Readers should consult with an attorney regarding local real estate laws and customs as they vary by state and jurisdiction. Using this article without permission is a violation of copyright laws.

Real Estate Agent Personality

real estate agent personality
Working with a real estate agent (infographic from keepingcurrentmatters.com)

Many home buyers and sellers don’t give much thought in choosing their real estate agent. They may decide to work with an agent after meeting once or a phone call.  But having the right agent by your side can mean the difference in having an event-free home buying or selling experience, or one that is full of pitfalls and non-communication.  Besides professional expertise and experience, is there a real estate agent personality trait that gives you an advantage?

Lee Davenport conducted a groundbreaking study comparing real estate agent personality differences (Home Sales Success and Personality Types: Is There a Connection?; Journal of Real Estate Practice and Education; 2018; Vol 21, No 1; p29-57.)  The study investigated the question whether there is a connection between successful real estate agents and their personality type.  Success was measured through lead generation (e.g., meeting new clients).  Although you might think there is a personality that is better suited for real estate, the study concluded that there wasn’t one specific personality type that correlated to real estate success.  However, he suggested that there should be further research to understand why there is no difference in the success among real estate personality types.

Back in 2014, Graham Wood wrote an article for NAR that also questioned if there was a perfect agent personality (Are You Sure Your Agents Have the Right Personality for the Job? nar.realtor; April 11, 2014).  Although the article was not a study published in a peer reviewed journal like Lee Davenport’s, it does provide food for thought and an obvious conclusion. 

Wood, like Davenport, questioned which personality dimension on the DISC test was better suited for real estate.  After testing himself, Wood believed his personality traits were not suited for a people-skills intensive field (such as real estate sales).  However, after interviewing several brokers, he learned that there is place in real estate for pretty much any personality type.  The DISC (discprofile.com) is a behavioral assessment tool that helps people be more self-aware, and increase productivity. 

What should you look for when choosing your agent?  First, make sure they are licensed in the area you intend to buy and/or sell.  I can tell you that there are agents who try to do business over state lines where they are not licensed.  It happens more than you think. 

Second, what’s their experience and expertise?  In today’s market, most agents don’t confine themselves to specific neighborhoods.  The idea of “neighborhood specialists” is antiquated.  Information is abundant to agents and consumers, and can easily be applied to any neighborhood.  You can learn more about an agent by how they handle adversity. Instead of asking about how many sales they have or neighborhood experience, ask about specific transactions where they overcame obstacles.

Other considerations include getting a referral from a friend or relative. But referrals should be vetted.  Just because your friend had a good experience with their agent, doesn’t guarantee success for you.  Sometimes agents and clients connect and work well together, and sometimes they don’t. Just in case, make sure you can walk away from your agent by ensuring your buyer or listing agreement provides for termination without a penalty.

Also, it doesn’t hurt asking the agent for a couple of references from recent clients.  You can get insight into the agent’s business by calling the references and asking about their experience with the agent. 

By Dan Krell
Copyright © 2020

Original located at https://dankrell.com/blog/2020/11/28/real-estate-agent-personality/

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Disclaimer. This article is not intended to provide nor should it be relied upon for legal and financial advice. Readers should not rely solely on the information contained herein, as it does not purport to be comprehensive or render specific advice. Readers should consult with an attorney regarding local real estate laws and customs as they vary by state and jurisdiction. Using this article without permission is a violation of copyright laws.

The open house – still important when selling a home

home for sale

Have you wondered how the open house tradition evolved? Earlier this year, Realtor.com detailed its history. Apparently, the first recorded open house was over one hundred years ago and described as “open for inspection.”  The inspection was held over days or weeks allowing home buyers to inspect the home’s structure, layout, and features. It wasn’t until the 1950’s when the more familiar format and term “open house” took hold (Rachel Stults, A Brief History of Opening Our Homes to Total Strangers (aka the Open House); realtor.com; April 21st, 2015).

home for sale
from HouseHunt.com

Transformation of the open house can be gauged along with licensing, sales and cultural trends. If you were selling your home one hundred years ago, having your home open to buyers for a week or two made sense because it allowed prospects to see what they were getting. In a time before licensed home inspectors, the internet and virtual tours; a week of inspection was an important selling tool.

Home buyers are once again taking the time to “inspect” homes through multiple visits; usually initiated at the open house. The internet has empowered buyers to be proactive, giving them the means to search on their own; often visiting open houses without an agent. Seeing a home virtually is just the first step, visiting the home logically follows. The visits give buyers the ability to view the home with their own eyes (not the camera’s); as well as being able to make the all important emotional connection – deciding if they can live in the home.

Regardless of what you hear about the effectiveness of the open house, it’s still an important sales tool. And if you’re planning on having one or several, there are a few important points to keep in mind:

Advertise.  You could say… “if you advertise they will come.” Most open house advertisements have moved away from the Sunday classified section to online real estate portals. I can tell you that when I ask visitors how they found out about the open house, the overwhelming answer is that they saw it advertised online. When setting up your online open house announcement, make sure that there is an enticing and brief description of the home to grab the buyer’s attention.

Make sure the advertised times for your open are accurate. More importantly, confirm your agent is at the home on time, if not early. A common faux-pas is not having anyone at the home when the open house is planned to begin. And unfortunately, a buyer left waiting to get in will more than not move on to the next open house.

Prepare. Organizing an open house offers the opportunity for you to focus on the details. No matter how much de-cluttering you have undertaken prior to listing your home, you can always tidy-up. Additionally, pay close attention to your home’s curb appeal, as it can be the difference between buyers entering the home or driving on.

Finally, make sure your agent is working the open house to sell your home. Agents know that many buyers visit open houses without an agent. And in the past, many agents advocated to have the opens not for the seller’s sake, but instead to build their buyer pipeline. Knowing this, the Maryland Real Estate Commission reminded listing agents a few years ago of their duty to their seller, clarifying their role at the open house.

By Dan Krell
Copyright © 2015

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Disclaimer. This article is not intended to provide nor should it be relied upon for legal and financial advice. Readers should not rely solely on the information contained herein, as it does not purport to be comprehensive or render specific advice. Readers should consult with an attorney regarding local real estate laws and customs as they vary by state and jurisdiction. Using this article without permission is a violation of copyright laws.