This blog is going to be brutal to some people. That’s OK. This is an unapologetic call for us as real estate agents, brokers, and trainers to raise the bar on our standard of professionalism when it comes to taking over-priced listings.
I got this email from an agent recently:
Quick question ..called a couple of fsbo owners and after a meeting one agreed to list with me.
After doing the CMA…[it’s obvious the house is worth less than they want.]
Not sure what to do .. I know they will not agree to list for less…., on the other hand I am fairly certain that at their desired price the house will just " sit there " . On one hand I can take the listing to " get my sign out " ( even sounds pitiful) or should I just refuse to take the listing ?[end of email]
How many of us have been told at some point in our real estate career (especially as a new agent) to go ahead and take a listing even if it’s over priced to “get your sign out there” or so that at least you can “get buyer calls?” I remember hearing that too.
And I agree with this agent’s assessment in the email that it “even sounds pitiful.” Which means they already know the right answer, right?
There are two common reasons agents take overpriced listings:
#1) To “get their sign out there” for buyer calls.
#2) Because the seller doesn’t like the price the agent recommends, so the agent agrees to the high price with the hope or expectation that the seller will eventually come around to “reality.”
Come on, folks. We can do better than that.
Why you never want to take an overpriced listing:
REASON #1: It’s BAD BUSINESS.
In the first place, because it doesn’t represent your client’s best interest. In any other profession, misrepresenting a client like this would be inexcusable.
For a CPA to prepare your taxes incorrectly on purpose just to make more money or to make you happy…that would be a criminal offense.
For a doctor to perform a surgery you didn’t need…or to prescribe a drug for the kickbacks from the pharmaceutical company…malpractice.
For an attorney to take a case he/she knows you can’t win just to get the retainer and fees….you would want them disbarred.
For a dentist to do a root canal on a healthy tooth for the fee…inexcusable malpractice.
But for an agent to take an overpriced listing even though the agent knows it’s overpriced….is too often considered just business as usual. Really? This is what I call BS (Bad Sales). Simply put, it doesn’t represent the seller’s best interest…which happens to be a fiduciary obligation you accepted as their agent.
And it’s not just as easy as saying “we can always reduce the price.” Because the longer the house sits on the market the lower offers it tends to generates. Which causes lower sales prices (not to mention lower commission for you.).
Beyond being bad for the client. It’s also bad business for you as an agent. How much extra time and money and resources (and stress) is required to “service” an overpriced listing. Lots.
REASON #2: IT’S BAD MARKETING.
This idea of taking a listing to get your sign out there and for the buyer calls, beyond being unethical and unprofessional, it makes you as the listing agent look incompetent. Think about it.
Your sign in the same yard month after month with no SOLD sign showing up IS marketing to every homeowner in the neighborhood…but it’s not the marketing you want. What exactly are you advertising? Your incompetence and inability to get results. And when your sign comes down a few months later without the house selling, you just told every homeowner in the neighborhood NOT to list with you, because you don’t know how to get a home sold.
Oops! That was not the marketing message you wanted, was it?
The right way to get more listings at prices where they will sell is really very simple:
1. A skilled and confident approach with people who are motivated to sell (CLICK HERE for one of my free training videos on finding motivated sellers).
2. A powerful, prepared listing presentation the educates them on the true market value of their property and that inspires them to trust you with the job of selling their property and getting them the best results.
3. Only take listings when the sellers are as motivated and committed to selling as you are. If they’re not, it’s OK. Build a relationship with them. Stay in touch. And don’t ruin your credibility by putting their house on the market at a price that it will not sell.
4. Sell every listing you take…which is actually possible. I know that sounds radical, compared to what most brokers, managers, and coaches teach, but why not? Selling every listing is totally normal and possible when you follow point #2 and #3. And it will give you huge leverage and credibility with every potential seller. This is what I train agents how to do…sell every listing for top dollar.
Imagine how good it will feel to know that you always deliver results and how much less stressful it would be to not have to deal with overpriced listings and angry sellers. Make a decision to operate your business as someone who consistently delivers results and never has to resort to an excuse for why your client’s house hasn't sold. Yes. It’s possible. And it’s awesome!
If you have questions or comments about taking listings at the right price. Also, if this helps you, please share it with other agents you know to help me get the word out to more agents.