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Lets get realistic here. Regardless of how noble some people are, the majority of agents are representing themselves and will continue to do so until the end of time. They line their own pockets with commissions. If a house is priced 50k over what it should be, the seller has a 0% chance of selling, and the point is moot. The agent would actually do the seller more harm by keeping the price there given that houses are selling for less and less each month.
I have a lot more respect for the real estate agent that does not lie to my face and try to convince me that a house is a great deal than the real estate agent who "works for the seller" and tries to convince me that 280k is a great price for a 3 br cape with dated kitchens and bathrooms.
The only way a house will sell is if it is priced right. The way the price gets there is irrelevant to me. The truth hurts, but in the end, I'd rather deal someone who tells the truth than someone who lies.
I never said anyone should lie. In fact, I'd advise against that every time. And in the Realtor code of ethics, it's clear that we are not allowed to lie, even if you are not our client.
What I said was that a real estate agent representing a seller at that sellers house should not be telling people he thinks the house is overpriced. He should point out the positives, and encourage an offer. He is doing his client, the seller, a disservice if he is telling people it's over priced. He's neglecting his duty to his client. Unless of course, that client tells him he an tell people the house is overpriced. You may say you have more respect for the agent who tells you it's over priced, but put yourself in the sellers shoes. You list your house. The agent tells you he feels it's too high a price and should come down. "Let's try it at the higher price for 30 days," you say. He agrees. Now, at the open house, you want him telling people it's overpriced? No, you don't.
Like others have said, though, as a buyer, I'm far more interested in dealing with an honest realtor, and I'm far more likely to put in an offer with them. If the realtor thinks the house is overpriced, I think they should give their honest opinion. To me, that IS working for the seller, as they're more likely to get offers and sell the house rather than having the house just sit there.
Let's ask sellers what they think. Remember, the listing agent is working FOR the seller. The agent might have a conversation with the seller, tell him, "Listen, we're priced 8% too high. We aren;t going to get serious offers unless we lower it." The seller sasys, you may be right, but I want to try it here for a bit. So, do you really think the agent, who represents the seller, ought to be telling people, hey, we're 8% too high. What do you think?
I never said anyone should lie. In fact, I'd advise against that every time. And in the Realtor code of ethics, it's clear that we are not allowed to lie, even if you are not our client.
What I said was that a real estate agent representing a seller at that sellers house should not be telling people he thinks the house is overpriced.
However, if the agent believes that the house is overpriced and doesn't say so--especially if a potential buyer says, "Geez, I think this house is overpriced" or even asks the agent, "X amount!? Don't you think that's overpriced", then I would say that they are lying. You might call it "creatively avoiding the comment or question". I wouldn't.
Quote:
put yourself in the sellers shoes. You list your house. The agent tells you he feels it's too high a price and should come down. "Let's try it at the higher price for 30 days," you say. He agrees. Now, at the open house, you want him telling people it's overpriced? No, you don't.
No, as a seller, I still do not want an agent who lies. And if the agent thinks the higher price is too high, they shouldn't so readily agree to try to sell it at the higher price. When the seller says, "Let's try it at the higher price", the agent should be honest--at least say, "Okay, I'll try it at the higher price if that's really what you want, but I think it's overpriced, and I can not lie about that if someone asks me about it; I'm not going to bs them that it's 'really worth' that amount because you've got a granite countertop or something--I know it has a granite countertop and it's overpriced." The agent who thinks it's overpriced and goes ahead with the ridiculous price anyway is probably helping waste everyone's time.
Of course, the seller can always get a less honest agent who'll not speak his mind.
So, do you really think the agent, who represents the seller, ought to be telling people, hey, we're 8% too high. What do you think?
As above, I think that per what "honesty" refers to, the agent would not be honest if they do not say that they believe it's 8% too high should that issue come up with a potential buyer. Otherwise, we're twisting what "honest" conventionally refers to in a way that, well, I do not believe is very honest.
However, if the agent believes that the house is overpriced and doesn't say so--especially if a potential buyer says, "Geez, I think this house is overpriced" or even asks the agent, "X amount!? Don't you think that's overpriced", then I would say that they are lying. You might call it "creatively avoiding the comment or question". I wouldn't. No, as a seller, I still do not want an agent who lies. And if the agent thinks the higher price is too high, they shouldn't so readily agree to try to sell it at the higher price. When the seller says, "Let's try it at the higher price", the agent should be honest--at least say, "Okay, I'll try it at the higher price if that's really what you want, but I think it's overpriced, and I can not lie about that if someone asks me about it; I'm not going to bs them that it's 'really worth' that amount because you've got a granite countertop or something--I know it has a granite countertop and it's overpriced." The agent who thinks it's overpriced and goes ahead with the ridiculous price anyway is probably helping waste everyone's time.
Of course, the seller can always get a less honest agent who'll not speak his mind.
"Well, Mr. & Mrs. potential buyer, the seller feels he's got it priced right. And as you know, my job is to represent the seller. As to what he might accept or not accept, the only way to be sure is to put an offer in writing. Do you have an agent you'd like to represent you on this, or would you like me to just help you get an offer in writing to the seller."
I have had three houses in my 42 years. And you know what no real estate agent talked me into anything, why does everyone put so much "trust" or listen or creed into what an agent says. I had nothing but my own gut feeling and no agent every told me what do sell, or buy at and even if they did I would not listen. Can't anyone make a decsion on their own. I had a bunch of great agents and bascially made my own decisions. However Bill Your hired!!!!!!!!!!!!!!! You seem like a smart good man, and I wont listen to you either as my agent!!
"Well, Mr. & Mrs. potential buyer, the seller feels he's got it priced right. And as you know, my job is to represent the seller. As to what he might accept or not accept, the only way to be sure is to put an offer in writing. Do you have an agent you'd like to represent you on this, or would you like me to just help you get an offer in writing to the seller."
It's avoiding the question. I do not consider that honest (which I already stated).
I'd like to explore this further. So if you'll play, I'd appreciate it.
The seller & agent go through the facts & info, they review the market, they factor in the best comps, and come up with a price. Agent markets the property for 20 days, to a good deal of traffic, but, alas, no offers.
The agent & the owner sit down, review all the data, including the few homes that have sold & gone under contract since they listed. The agent says, "It seems clear that the market has continued to drop, and we need to get in front of it if we want to sell. I recommend dropping the list price from $685k to $650k."
"Not yet" says the seller. "I think we ought to go a full 30 days at this price, to see if we can't get it. I know it's worth it. If we can't get an offer in another 10 days, then we'll talk about dropping the price."
After trying for 15 minutes to convince the seller that dropping the price now is the better strategy, that the market is falling ahead of them and that it's better to do it quickly lest they have to do it more when they finally do it, the agent resigns himself to 10 more days at this price.
This is on a Wednesday. There's an open house scheduled for Sunday. Yes, we'll stay with that marketing plan, hold the open house.
The agent puts ads in the paper and on the internet, makes sure it's listed in the MLS & Realtor.com open house listings, does all the things he needs to do to create the perfect open house atmosphere. Half an hour into the open house, a couple stolls in. Sure we'll sign in. Thanks for this info sheet, yes, I see the Consumer Information Statement disclosing how real estate relationships work. Show us the house please. Yes, nice layout, good room sizes, gee I wish it had granite counter tops . "Hmm," says Mr. Potential Buyer, "It's nice & all, but geeze, it's overpriced by at least $30k , and probably more like $50k, for the current buyers market, don't you think?"
So, you want the agent to respond how?
Last edited by Bill Keegan; 12-02-2008 at 07:25 PM..
Reason: typos
Great points. Real Estate is a funny business because both buyers and sellers forget that this is all happening within a free market. Values have less to do with comparables, brokers, or what you paid then with the actual price at which people are willing to transact. Right now that price is falling and looks like it will continue to fall until the market reaches equilibrium.
It's just the way things work. So buyers can sit there insisting that their house is worth more, but unless someone is willing to pay that price, it's all make believe. The value of your house is simply what buyers are willing to pay for it!
A good agent can help you maximize that price, but realistically the improvement will be marginal, unless you find a dummy who is willing to pay way over market.
You make really good points. I love how some of the sellers in my area think that adding that granite countertop will add another 10k to the price of their house. If the buyer likes it, they like it, with or without the countertop.
It is a free market and a you're right, a house is only worth what someone is willing to pay.
I'm not sure how everyone else feels, but I know as a buyer, I don't care if every room has fresh paint, because I know I'm going to change it anyway. Doesn't bother me a bit and a lot of the people I talk to say the same thing.
I have to wonder, how much difference does it really make to do all the upgrades? If homes in a particular neighborhood are going for x amount, will upgrading put you above that amount? I just don't think so.
This being asked, keep in mind that I completely remodeled my entire house within the past 18 months. I'm just not willing to do any more. I need to save to be able to make my next one mine.
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. "Hmm," says Mr. Potential Buyer, "It's nice & all, but geeze, it's overpriced by at least $30k , and probably more like $50k, for the current buyers market, don't you think?"
