Firing the Realtor?
August 28, 2006 5:51 AM
When to fire the Realtor?
How do i determine if it's him or a flattening market?
Our house has been on the market for 39 days when the average for our neighborhood is 34. We have the lowest priced house, comparatively speaking, in the neighborhood, and there has been a decent amount of 'traffic' and one near-offer.
Our realtor has a different type of fee structure. We paid him $500 up front, with an agreement that he would get 1/3 of a percent at closing. Since we are now in our new home 10 hours away, it's hard to tell if much legwork or advertising is being done. He does have a decent track record, or so we heard, and came highly recommended as a friend of a friend.
Our prior first choice for a realtor is well known in the neighborhood and has been representing a surprising number of buyers and sellers in our subdivision. He sold our neighbor's home in 4 days at the beginning of summer. He, of course, has the traditional 3% commission structure.
So while I have no problem firing realtor #1, I would hate to lose the $500 on a whim when it could simply be a flat market.
Our realtor has a different type of fee structure. We paid him $500 up front, with an agreement that he would get 1/3 of a percent at closing. Since we are now in our new home 10 hours away, it's hard to tell if much legwork or advertising is being done. He does have a decent track record, or so we heard, and came highly recommended as a friend of a friend.
Our prior first choice for a realtor is well known in the neighborhood and has been representing a surprising number of buyers and sellers in our subdivision. He sold our neighbor's home in 4 days at the beginning of summer. He, of course, has the traditional 3% commission structure.
So while I have no problem firing realtor #1, I would hate to lose the $500 on a whim when it could simply be a flat market.
$500 is sunk. You won't "lose" it more or less if you keep this realtor or get a new one. I can't tell you if you should switch or not, but the $500 is gone and you shouldn't let it be a consideration any longer.
posted by sohcahtoa at 6:07 AM on August 28, 2006
posted by sohcahtoa at 6:07 AM on August 28, 2006
I would suggest first talking to your current Realtor, and find out what he thinks about why your house isn't selling. Remember, 34 days is the average, which means those 4 day sales are balanced out by 60 day sales (which is still remarkable).
Unfortunately, your Realtor doesn't have the same incentive to sell the home that a "traditional" fee structure provides - namely no sale, no payment. Even on a $300K home, he's only looking at another $1,000 when the home sells - as opposed to $9,000 for a traditional 3% sale (or $18k around here for a 6% listing fee, which is the norm around here).
It could be the market. It could be that your home has a certain quality that makes it less desirable than similar homes (layout,paint colors, yard). Why did the near-offer not happen? It could be that you hired a discount Realtor who is providing discount services. Ask him to take some pictures of the home, outside and inside, to show you its current condition. That curbside appeal really is crucial, and if no one is maintaining the yard, it will hurt your chances.
If you really decide to move on, try to negotiate that $500 in your next deal. Listing fees are always negotiable (although more established Realtors are in a stronger position in this sense), so tell the new potential Realtor your past issues, and that you'll list it with them for 3% - $500. Just remember, if it takes an extra three months to sell it with this discount Realtor, that's an extra three mortgage payments you're making on the previous home.
Good luck, if you have any questions, email is in my profile. (I am a Realtor, not your Realtor)
posted by shinynewnick at 6:21 AM on August 28, 2006
Unfortunately, your Realtor doesn't have the same incentive to sell the home that a "traditional" fee structure provides - namely no sale, no payment. Even on a $300K home, he's only looking at another $1,000 when the home sells - as opposed to $9,000 for a traditional 3% sale (or $18k around here for a 6% listing fee, which is the norm around here).
It could be the market. It could be that your home has a certain quality that makes it less desirable than similar homes (layout,paint colors, yard). Why did the near-offer not happen? It could be that you hired a discount Realtor who is providing discount services. Ask him to take some pictures of the home, outside and inside, to show you its current condition. That curbside appeal really is crucial, and if no one is maintaining the yard, it will hurt your chances.
If you really decide to move on, try to negotiate that $500 in your next deal. Listing fees are always negotiable (although more established Realtors are in a stronger position in this sense), so tell the new potential Realtor your past issues, and that you'll list it with them for 3% - $500. Just remember, if it takes an extra three months to sell it with this discount Realtor, that's an extra three mortgage payments you're making on the previous home.
Good luck, if you have any questions, email is in my profile. (I am a Realtor, not your Realtor)
posted by shinynewnick at 6:21 AM on August 28, 2006
Our house has been on the market for 39 days when the average for our neighborhood is 34.
The most recent average days on the market figures we have are for July. Houses that closed in July went on the market (for the most part) in May, June or July. It's now late August, and a lot's happened in real estate since then. You have no idea what the average for the market for your neighborhood is. Five days longer than the July average is not a sign that your real estate agent is incompenent (he may be, but you'll have to look for other signs of his competence to judge this).
I can't find a link to the article, but The Oregonian recently reported that as the market cools buyers are waiting longer to look for homes. There's a weird set of conflicting expectations playing out, at least in Portland. After years of getting priced out of the market, buyers are waiting for home prices to drop and are hoping to get a great deal. With their houses valued near historic highs, sellers expect their homes to sell fast and for big money.
So that's one factor in why your home may not be selling.
Go for a walk around your neighborhood -- a several mile radius. How many other for sale signs do you see? In my neighborhood, just about everyone who's been sitting on his or her house wondering whether to sell has put their home on the market in the last month or so. They're hoping to cash in before it's too late. If your market is over-saturated and buyers are waiting longer anyhow, it makes sense that your house would take at least a few days longer to sell.
So you want to know whether your real estate agent is earning his keep? Does he run an ad in the local daily paper? Does he have a web site, with details of your property along with the other properties he's trying to sell? Is your home listed in the MLS database for your region (I'd point you to if, if I knew where you were)? If you live near a major metro area, is he listing your property on craiglist (not everyone does this last one)?
To me, it sounds like you're over-stressing and have unrealistic expectations.
If your real estate agent doesn't seem to be trying to sell your house, that's when you want to start worrying. Until then, I'd chalk it up to broader trends.
If you had your location in your profile it would be a lot easier to give you a realistic response to your question. It sounds like you're in the US, though you don't say so explicitly. Are you in the South, where home sales are still relatively strong (though this varies by market)? Are you in the West, where sales and prices are dipping (with a few exceptions)? Are you elsewhere?
posted by croutonsupafreak at 6:44 AM on August 28, 2006
The most recent average days on the market figures we have are for July. Houses that closed in July went on the market (for the most part) in May, June or July. It's now late August, and a lot's happened in real estate since then. You have no idea what the average for the market for your neighborhood is. Five days longer than the July average is not a sign that your real estate agent is incompenent (he may be, but you'll have to look for other signs of his competence to judge this).
I can't find a link to the article, but The Oregonian recently reported that as the market cools buyers are waiting longer to look for homes. There's a weird set of conflicting expectations playing out, at least in Portland. After years of getting priced out of the market, buyers are waiting for home prices to drop and are hoping to get a great deal. With their houses valued near historic highs, sellers expect their homes to sell fast and for big money.
So that's one factor in why your home may not be selling.
Go for a walk around your neighborhood -- a several mile radius. How many other for sale signs do you see? In my neighborhood, just about everyone who's been sitting on his or her house wondering whether to sell has put their home on the market in the last month or so. They're hoping to cash in before it's too late. If your market is over-saturated and buyers are waiting longer anyhow, it makes sense that your house would take at least a few days longer to sell.
So you want to know whether your real estate agent is earning his keep? Does he run an ad in the local daily paper? Does he have a web site, with details of your property along with the other properties he's trying to sell? Is your home listed in the MLS database for your region (I'd point you to if, if I knew where you were)? If you live near a major metro area, is he listing your property on craiglist (not everyone does this last one)?
To me, it sounds like you're over-stressing and have unrealistic expectations.
If your real estate agent doesn't seem to be trying to sell your house, that's when you want to start worrying. Until then, I'd chalk it up to broader trends.
If you had your location in your profile it would be a lot easier to give you a realistic response to your question. It sounds like you're in the US, though you don't say so explicitly. Are you in the South, where home sales are still relatively strong (though this varies by market)? Are you in the West, where sales and prices are dipping (with a few exceptions)? Are you elsewhere?
posted by croutonsupafreak at 6:44 AM on August 28, 2006
The home is in Nashville, TN, in a reasonably nice neighborhood, listed for a very competitive amount.
posted by toastchee at 6:56 AM on August 28, 2006
The $500 is the least of your financial concerns.
I'm thinking you figured the house to sell in 4 days and felt $500 + 1/3 of one percent was a fair price for the service under those conditions. However, it looks like that was wrong - so you need to reset your thinking on it.
The $500 was a gamble that didn't pay off, forget it. Your problem now is the house has been sitting on the market for the average length of time already. The final selling price is likely headed south as of now because of that. Hire a regular realtor at going rates and get it done asap.
posted by scheptech at 6:56 AM on August 28, 2006
I'm thinking you figured the house to sell in 4 days and felt $500 + 1/3 of one percent was a fair price for the service under those conditions. However, it looks like that was wrong - so you need to reset your thinking on it.
The $500 was a gamble that didn't pay off, forget it. Your problem now is the house has been sitting on the market for the average length of time already. The final selling price is likely headed south as of now because of that. Hire a regular realtor at going rates and get it done asap.
posted by scheptech at 6:56 AM on August 28, 2006
I'd stick it out with your current realtor, from the sounds of it. 39 days is not unreasonable. Talk to him about why it might be taking this long to sell your house: he should have answers.
Unless you have other reasons for thinking him incompetent.
(Also: many listing agreements lock you into remaining listed with that agent for a certain period of time. Does yours? Most competent real estate agents will excuse you from that obligation if you really want to list with someone else, but just something to be aware of.)
posted by Count Ziggurat at 7:40 AM on August 28, 2006
Unless you have other reasons for thinking him incompetent.
(Also: many listing agreements lock you into remaining listed with that agent for a certain period of time. Does yours? Most competent real estate agents will excuse you from that obligation if you really want to list with someone else, but just something to be aware of.)
posted by Count Ziggurat at 7:40 AM on August 28, 2006
The market is taking a dive. It may not be your realtor's fault.
posted by Mr. Gunn at 7:46 AM on August 28, 2006
posted by Mr. Gunn at 7:46 AM on August 28, 2006
1) As others have said, forget the $500. That's peanuts in the overall scheme of things and it's gone no matter what you choose to do. The costs are sunk and there's no point in dwelling on them as in "I paid for these french fries and by god I'm going to finish them even if they make me barf."
2)Talk to your current realtor. It's only one phone call. If you don't like his answers, just dump him and get somebody else. All fair in love and war and the housing market.
Good luck.
posted by bim at 8:18 AM on August 28, 2006
2)Talk to your current realtor. It's only one phone call. If you don't like his answers, just dump him and get somebody else. All fair in love and war and the housing market.
Good luck.
posted by bim at 8:18 AM on August 28, 2006
I live in one of the hottest housing markets. My place has been on the market a month. This is because almost nothing goes on in August where we live. We expect things to heat up after Labour Day. In fact, since this weekend, my realtor's phone has been ringing non-stop with people wanting to visit. We will be doing our fifth showing in two days today!
posted by acoutu at 9:02 AM on August 28, 2006
posted by acoutu at 9:02 AM on August 28, 2006
Other realtors have no real incentive to bring their buyers to your house if they aren't going to get a full commission (which is usually the case with some of these cheaper realtors) -not to mention the regular realtors have a real problem with folks who use that fee structure.The usual split here is six percent with half going to the seller's agent and company and half going to the buyer's agent and company.
It could be the market, but the type of realtor you are using may be a factor.
The real truth about home sales is that generally your lister is not going to be your seller. Your lister will want other agents to take their clients to see the home. THAT is how homes get sold in the majority of cases. If the deal you have with your agent is that HE will sell the home, or if there are disincentives for other agents to show the home, you have a problem. Does he have your house in the MLS? If he doesn't GET ANOTHER AGENT.
posted by konolia at 9:03 AM on August 28, 2006
It could be the market, but the type of realtor you are using may be a factor.
The real truth about home sales is that generally your lister is not going to be your seller. Your lister will want other agents to take their clients to see the home. THAT is how homes get sold in the majority of cases. If the deal you have with your agent is that HE will sell the home, or if there are disincentives for other agents to show the home, you have a problem. Does he have your house in the MLS? If he doesn't GET ANOTHER AGENT.
posted by konolia at 9:03 AM on August 28, 2006
Can we also talk about how the 34-day average means that lots of houses get sold for more than 34 days? Especially if some of them are going in only a few days?
posted by drewbeck at 10:37 AM on August 28, 2006
posted by drewbeck at 10:37 AM on August 28, 2006
This thread is closed to new comments.
posted by Gungho at 6:04 AM on August 28, 2006