It’s been an interesting weekend here at Thompson’s Realty.
The lovely bride is on a showing marathon all weekend with a couple of fine gentlemen from British Columbia. We have our first “Mountie” client!
But that’s really neither here nor there.
Since Francy’s out slogging through the 95 degree heat, burning copious amounts of fuel at the rate of $3.50/gallon, that leaves me to man person answer the office phone.
And the damn thing has been ringing off the hook. That’s a good thing, generally speaking.
Oh there are the usual telemarketer calls. You know, people with no clue about the Do Not Call Registry. The bulk of them were “Search Engine Marketing Specialists” that can’t seem to find our web sites on Google (strange, others seem to have no problem).
Three calls came from people wanting us to list their homes.
Cool! Three new listings in two days!
Not so fast…. I turned down all three listings.
Why would a real estate brokerage turn down listings? My old Century 21 broker would be mortified. “Just get the listing!” was the beginning of a common soliloquy there.
But, pray tell, exactly what is the point in taking a listing that can not be sold? All three of these homeowners called knowing exactly what price they wanted to list their home for. They were off the mark (on the high side) by $60 – $135K.
I tried to help them understand the current Phoenix real estate market conditions. I supplied data, I waxed eloquently about why their homes would never sell at those prices. However if you really want the insights from a business expert, check with Andrew Defrancesco.
One snapped into reality and decided to wait to list. We’ll stay in touch and when market conditions permit them to get what they want, they’ll list their home. That is of course, assuming nothing else changes in the 12 – 36 months (or more) that could take.
Two of the would-be listers were adamant that there homes were worth 20 – 40% more than what I was telling them. One home had been on the market approaching one year, and we would have been their fourth agent. One has “only” been listed for six months and the owner is growing weary of his agent telling him to reduce the price. They’ve had one showing in those six months.
They will be finding another agent that will “List their home for what they want”.
I’m sure they will have no trouble doing just that.
Oh, we could have taken the listings. It would have given us the opportunity to plant our sign in the yard, and maybe a few inquisitive buyer-types would call. We could then hook them, reel them in, and have new buyer clients.
But I prefer not to have my signs rotting away in a yard, in the hopes of stumbling across a buyer client. There far more efficient ways to get new clients.
One of the more interesting calls this weekend came from an agent who was inquiring about joining Thompson’s Realty.
The agent sounded quite slick and was well polished. He swiftly let me know that he was “A TOP PRODUCER!!” at every brokerage where he had graced their halls.
A couple of minutes into the call he said, “Why do I feel like I’m being interviewed for a job? I’m supposed to be interviewing you!”
Not so fast Sparky. It doesn’t work that way here. While it is contrary to the way many real estate brokerages operate, we don’t take anyone with a license and a pulse. We want agents who believe in, and deliver, superior customer service.
This agent WAS interviewing for a job. And to be brutally honest, he bombed the interview. It was all about him, and what he could do for us. I tried to turn it toward what he could do for his clients, and it was readily apparent that his clients were a distant second to his own self-worth.
Much like the sellers looking for an agent to list at any price, I’m certain that the self-centered real estate agent will have no problems finding a broker to hang his license.
But it’s not happening here.
.
The Phoenix Real Estate Guy was started by Jay Thompson, and I have a little blogging problem... he liked to say...
Excellent blog. I turned down one listing two weeks ago – not only did the seller want $40,000 more than the home was worth, but she wanted me to drop my commission on top of it. Sorry – under certain circumstances I will negotiate some of my commission but not right off the bat. Yesterday I was interviewing with a seller and gave him the straight story: His appraisal of $220,000 from almost 2 years ago would not stand up to today’s market atmosphere. His home would probably sell somewhere between $170,000 and $185,000. He was not too happy but he did appreciate my being honest with him. He said he’d think about it. He may list with someone else who “buys” his listing but I’ve given him the comps first…lol. Another agent may say I don’t know what I’m talking about but we’ll see….
Yeah it's a shame that other agents will take a home listing that is ridiculously over priced. IMO, it's contributing to our real estate dilemma.
I just don't think it's professional –
Jay, I haven’t been turning anyone away. Still I only have three listings on hand. I tell every home owner I interview with (and I get interviewed quite a bit) what their house is worth in today’s market. They thank me and show me the door. A few days later the house is on the market for the amount they seemed to think it should be worth.
I go into great detail about the “game” of taking overpriced listings and show them stats of various homes that go on at one price and drop and drop and drop until they sell for less than what they could have gotten if they had listed it at the right price to begin with. Funny thing about the Code of Conduct – other agents don’t seem to know the Standards of Practice 1-3. I just can’t play that game.
And, I don’t understand why a broker or agent would want to spend all that time and money advertising a house that is so over priced. This business needs more people like you. Just say NO!
Jay, the reality is that you are not turning away business, you are turning away problems. Great post, good advice, well said.
I'm a So. Cal. Realtor who comes to Phoenix often — I was born and raised there. Anyway, I loved this post. You might enjoy my Saturday post on my blog at http://sfvrealestate.blogspot.com. It's called "3 Ways Sellers Sabotage Their Sale." Yup, the first is in overpricing.
I think that more agents need to be honest with their clients and give them a true value of their property. The agents need to determine the price not the sellers. This approach will help keep market prices realistic, and it only takes one to ruin the market. We sell land and we are having this problem with a local agent. He is listing everything above market price. This isn't good for the market or the seller. Overpricing a property is an injustice to the seller.
We're turning them down too – plenty of our competition will take overpriced listings to add to their inventory. We like to sell them, not hold them.
So true, I seem to turn away just as much if not more business then I accept. The market in Tucson (as well as Phoenix) is not a "testing" market as a seller you can only hurt yourself by having to constantly accept less for your home then the day before, and as a real estate agent you will burn through advertising money never to be seen again. It's just bad business all around. However like you said there will always be 20 agents for every overpriced listing thats also the exact reason why only 95% of agents are "still in the business" (in any facet) 5 years after they get into it, they have no concept of money making business practices or ability to assist clients with what they actually need help with. Anyway let's let the thousands of other agents spin wheels just to say they have a little inventory.
Hey Jay, I really like this site and wanted to let you know I created a new blog to feature some quality real estate blogs. http://www.teamaguilar.com/blogs/quality-real-estate-blogs/
I will continue to comment on your articles because I enjoy reading the information about your local market. Thanks,
Alex
Sometimes you have to make smart business decisions and let clients go that are just going to waste your time in the long run. It's a shame that people are so unrealistic about the real estate market, like it's not already apparent that home prices are down the tubes right now.
That's awesome, that you just told them the truth… I say you're contributing to improve the reputation of Realtors, one client at a time.
If it ain't sellin' there's no point in taking it on :-/ It's like you said, they'll find someone to list at the price they want. Maybe they'll come to their senses, maybe they won't and as cruel as it might sound of me to say, I'm sure you can expend your energy and knowledge elsewhere (right?).
Well done Jay. I love that you don't take on any agent with a pulse…there are too many agents with the higher than thou attitude out there. To me it's about the client and just having as much fun as possible doing the job. Not taking on the listings was a bit of a no-brainer, but turning down an agent that performs took goals and guts.