Realtors tend to get a bad rap. But let’s face it, there are unprofessional people in every line of work. That also means there are many great Realtors! There are the kind that will help you earn more money as a seller or get more for your investment as a buyer. The key is to find those Realtors when you need them. Keep an eye out for these common real estate gimmicks...that may not have the best interests of the client in mind.
1. “I have a buyer for your home.”
Whether you hear this in a letter, by phone or in person, this a common trick some real estate agents use to get their foot in the door with a potential home seller.
If a real estate agent really has a buyer for your home, he or she should arrive with an offer whether they have listed your property or not. Otherwise, that agent is probably just trying to get your attention - and your business. What you really want is an agent who is willing to price your home competitively and market it to sell.
2. “This property won’t last long.”
Good Realtors don’t sell houses; they help buyers through the process of finding the best home they can afford. So, if you feel serious pressure from your agent to buy a particular house, something’s up.
Plus, in some instances, agents may be looking to “double-end” a real estate deal. This happens when they represent both the seller and the buyer, and therefore cash in on both commissions. This isn’t necessarily a bad thing, but if an agent pressures you to buy one house over another, you should be wary.
3. “If your house doesn’t sell, don't worry; I will buy it.”
Offering to buy an unsold house is another common tactic some real estate agents use. It isn’t dishonest (sellers will have to sign a contract with all the details), but while it may help agents attract more clients, it isn’t all it is cracked up to be. The problem? Sometimes, the price you get for the home in a case like this is much lower than list price - often as little as 85 percent of the home’s appraised value.
It is not a reason to list your home. List your home because your Realtor has provided you with a thorough marketing plan.
4. “This price will get you a bidding war.”
A bidding war happens when buyers get competitive with each other while making offers on a property. This often drives the home’s price up above list price. This is an outcome many sellers (and agents) fantasize about, but it is rare. Also, this strategy would involve possibly listing the home for less than it's market value, and that can be a big risk to take.
When the bidding war doesn't happen, the agent increases the home’s price. That’s the kiss of death! Start off with a list price you can actually live with and that is compettive within the current marketplace.
5. “I’m the biggest, I’m the best.”
Every city has at least one big-shot real estate agent. Maybe it is someone who has been working in the business for decades or maybe only a few years. Maybe they have invested a lot of time and money into high-quality advertising. Or maybe that individual is just a great agent who gets a lot of referrals. While a lot of clients can be a sign of an agent with a track record for getting the job done, it might also be a sign of what you might call “incumbent advantage”. Everyone likes a winner, so they pick the biggest agent, the agent everyone else is hiring.
The problem is that this often means poorer service. If an agent is listing 40-50 houses at a time, chances are he or she isn’t going to have much time for you. Plus, many of the biggest agents use a team approach. So, while you might think you are hiring the guy whose face you see on billboards or park benches, what you actually get is one of his assistants.
Forget the Gimmicks
So, with all these sales gimmicks, how can you find a Realtor you can trust? You probably didn’t hire your accountant or lawyer on a whim. The way you hire your real estate agent is no different. Whether you are buying or selling a home, you are dealing with big money and a great deal of emotion. A good agent can make a big difference...so shop around. Ask your friends for referrals. Look for reviews online. Then interview your top prospects and ask them what they will do to make sure you are informed, that your home is marketed properly and to make sure you get the most for your money - or the most money for your house. Accomplishing that isn’t a gimmick; it is a great deal of hard work. And that is something worth paying for.