Pricing High VS Pricing Right

 

You’re ready to sell your home and must start the interview process to find the best representation. You begin by asking Realtors what they think your home is worth. You will be provided with an abundance of comparables, market data, and most will suggest you schedule an appointment with them to get a comprehensive valuation; but one Realtor suggests that you sell your home for a much higher price. Everyone wants to sell their home for as much as they possibly can, and this will probably be the most appealing thing you’ve heard all day so you ignore the market data and research provided to you by other realtors. This is an unethical practice known as “Buying a Listing” and at its core is when a Real Estate agent offers you an inflated sale price in order to win your contract.

 

House and money on scales


“Home Buyers are in the midst of dealing with one of the most important transactions of their lives, and while your agent had ignored the market data and comparables, the Buyers certainly will not.”

 

 

How are you, the Seller, affected by a Realtor who has taken your listing this way? For starters, now that you are locked in with this particular agent, you are unable to sign with anyone else, and unless the agent gets unbelievably lucky, they will not be able to sell your home at it’s current price. Home Buyers are in the midst of dealing with one of the most important transactions of their lives, and while your agent had ignored the market data and comparables, the Buyers certainly will not. After a few months of being unable to sell, your home becomes stale on the market. Other Agents and Buyers will often look past stale listings as they believe there is a good reason for it’s inability to sell, and in this case there is, nobody wants to pay for an overpriced home. In attempt to revive your listing, your Realtor will be forced to undergo countless price reductions, and if the market had actually gone down in the many months that your listing was active, you will end up selling your home for far less than you could have had you priced your home properly the first time around.

 

“But why would any Real Estate Agent want to do this?”

 

There are two reasons a Realtor may want to buy your listing, the first being the ability to secure your contract. The Realtor that has bought your listing has now won your contract in their very competitive industry, and while they may be aware that your home will not sell overpriced, they are willing to wait it out until you crack and reduce the price to far less than it’s worth.. which you likely will since you cannot legally sign with another representative. During the time that your home spends on the market, your Realtor is attracting Potential Buyers with your listing, and while they may be turned off by the price of your home, they may use your agent as their Buyer Rep for similar properties.

On the other hand, many Realtors will actually have the best of intentions but are simply unaware that buying your listing is an unethical practice. These Agents likely want to have your home sold for the highest price with your priorities in mind; they may think your home is worth more than it is, or they might feel pressured by client expectations and opinions. Either way, an agent who buys your listing will affect it’s profitability nonetheless.

Only work with agents who will provide you valuable, honest service and do NOT fall victim to the temptation of overpricing your home. You can avoid hiring an agent who might attempt to overprice your home simply by doing your research. Check the agent’s past sales and testimonials, and make sure you get a Comparative Market Analysis so you can truly understand the market value of your home. In the end, this will give you the highest chances of having your home sold for the highest amount of money, in the shortest amount of time!

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