How the business works, and how I work the business (Seller’s agent)

Does your Realtor utilize third parties to make their life easier at the cost of personalized service to you?

Does your Realtor offer services that have costs beyond the negotiated commission fee?

Does your Realtor present push button, canned reports as analysis?

Here’s a hint… Most do.  It is how the business works.  But it doesn’t have to, and it is not how I work the business.  It’s just that most Realtors® take the easy way out, leaving you to do most of the work they should be doing for you.  And the problem is so pervasive, many Realtors® scoff at the suggestion that there is another way, employing teams of assistants and companies to do the job you hired them to do.

For example, almost every Realtor will offer to host an open house as part of their marketing plan.  But the bigger Realtors have teams, and they often farm out this task to members of their team.  You hire Realtor Smith, and Realtor Smith places a sign in front of your house, but Team Member Jones is at the house and answering telephone calls.  When you interview and hire an agent, make sure that you are getting that agent.  This problem is especially true with “super agents.”  Of course I have backup for those times when we plan and God laughs, but short of God’s intervention, when you hire me, you get me.

And that means that anytime someone wants to see your home, I will be there to meet them.  I will be there to unlock the door.  I will be there to keep an eye on your property and posessions.  And I will be there to address any concerns, and look for angles that may facilitate a sale.  Most other agents have a subscription to automated showing services which set appointments and distribute access codes.  Essentially built on selling the premise that agents can serve more clients (and make more money) by outsourcing functions that once were always provided by personal service, automated showing services make it easier for agents to spend less time working for their clients and more time doing something else.

Properties being serviced by these firms (MAPASS in MA, and ShowingTime in CT) have showing appointments handled by a call center, feedback handled via emailed survey, and access to your home unsupervised.  I’m all for working both smartly and efficiently, but agents who utilize these services are purchasing a way to avoid personally handle showing requests, avoid personally obtaining feedback on showings, and avoid personally marketing your home during showings.  Additionally, since they do not attend the showings, they are unable to, on-site and in real-time, correct potential buyer’s perceptions, offer history on the property, suggest other uses for rooms, or in short, market and sell your home to a potential buyer.  Once they convince you that they will work incredibly hard for you, these agents simply “set it, and forget it” leaving the marketing and sale of your home to a third party.  Selling a house consists of listing, marketing, and closing.  When you hire an agent who uses these services to show and market your home you have accepted that the “talent” you’ve hired is not important throughout the entire process – only at the listing and closing.

I choose not to use these services, and choose to be present at all showings of a client’s property.  This is how I work the business, and in my opinion, it is how the business should work.

Many agents and Brokerages will also have a-la cart services available beyond the cost to you negotiated in the listing commission.  These can include any or all of the following:

  • photography
  • videography
  • installation of a sign
  • installation of a lockbox
  • advertising fees
  • open house fees
  • marketing surcharge

I establish clear expectations and discuss all of these items prior to you hiring me.  All of the above are included in the fee we negotiate as a commission, and payable only if and when your home sells.  When interviewing other agents, make sure that you know what they are offering, at what rate, and if anything is extra.  Like the old adage says, if it looks to good to be true, it probably is…

Finally, when interviewing potential agents with whom to list your house, make sure they understand their own numbers well enough for you them to explain them to you.  This might seem like a crazy idea, but most Realtors are not computer savvy.  They rely on push-button canned reports for their client sales presentations.  And these presentations are based off of a database that all Realtors use.  So the presentation you get from one agent, adjusted for brand name and colors, may contain the same information as one you get from another.  The slicker Brokerages has added some more fluff to the basic presentation, but not more value.

How can this be?  Available to Realtors® via their MLS subscription is a Comparative Market Analysis tool.  A Comparative Market Analysis (CMA) is the name given to the methodology used by a Realtor® to arrive at a pricing conclusion for a particular piece of property.  There is no one correct way to perform this task, but it seems that many brokerages believe that there is.  The tools provided within the MLS form the basis of the CMA’s provided by most of the larger brokerages.  In fact, the following Brokerages have menu options built into this tool:  Century 21, Coldwell Banker, ERA, GMAC, Keller Williams, Prudential, Re/Max, and Realty Guild.  With variations in font, graphics, selected properties, and accompanying text, a CMA prepared by any Realtor using each of these brokerages menu selections is based on the same algorithms.  The tool’s reporting menu permits inclusion of slick looking graphs, 3 up comparison sheets, and options regarding the presentation of pricing, but the nuts and bolts “analysis” is the same.  Here’s a screen print illustrating my point…

screen print (MLSPIN CMA)

 

As a licensed CPA, with a Master’s in Business Administration I feel very qualified to judge the level of robustness a CMA contains.  When necessary, I custom make my CMA’s for each request using tools, and queries I’ve designed myself.  I include verbiage about each of the comparison properties that shows that I’ve at least visited each house in person (again, because the data in the database falls quite short), and in most cases, toured.  My analysis includes factors for landscaping, house condition, age of mechanicals, flow, and/or other factors that are not captured in the database.  If you are seeking to hire expertise, it is important to understand that the expertise you are hiring from the brokerages listed above, may be pre-packaged and non-market differentiated.

Essentially a CMA should provide a clear and logical defense of a pricing opinion.  As many properties are non-standard, in these cases it should provide a description of the methodology employed to reach a price.  It should contain evidence that the Realtor® toured, to the greatest extent possible, the properties used as a basis of opinion.  If you review one that doesn’t you should question if it truly reflects analysis, or just the selection of options on an MLS pre-programmed tool.  Pricing is the most important aspect of selling a home.  Houses priced right sell.  Those not priced right sit.  The agent signs you see sitting around town for multiple seasons are telling of an agent that either does not know how to price a house, or of a client unwilling to accept that their net expectations are too high.   When looking at a CMA ignore the boilerplate and graphics developed in a corporate marketing office.  Unless you think that the college intern who developed that stuff is going to be available to help you through the process of selling  your house.

I work differently.  If you would like to see an example of my CMA work, or to discuss listing your home for sale, or just to pick my brain, please contact me either by email or at 413-564-9468.