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Category Archive: ‘Listing Agent Practices’

This Week’s Disrupter

This start-up has the right ingredients, but their auctions do have a reserve amount and no buyer-agent commissions, which cuts out other agents.  They say  “No Double Ending’, but when the buyers are unrepresented it puts the listing agent in an agency position – if the buyers ask a question, and the agent replies, an agency relationship has been created. 

Every start-up wants to beat out realtors, and think that the consumers will trust their faceless, unproven venture instead:

LINK

TORONTO, Oct. 18, 2017 — There is a new way to buy and sell real estate in Ontario. With today’s official launch of On The Block Realty, the uncertain and often frustrating process of trying to navigate the home market has taken an innovative step forward. This brand new real estate brokerage based in Toronto, has opened its doors to the public, offering new unique approaches to the industry.

Chief among these advancements is the development of a cutting edge online auction platform that is aimed at bringing much needed transparency to buyers and sellers. The home buying process has been protected by silent bids in many situations, leaving buyers confused about what price to pay, and sellers concerned that some buyers may not have offered their best price. Inspired by the successful practice of real estate auctions in countries like Australia and the UK, this new system offers an exciting alternative for sellers who want to be certain they have maximized every bid from prospective buyers. It also ensures that every buyer has an equal opportunity to buy without any secrecy guarding the process.

“This isn’t about changing or fixing anything, it’s about evolving,” says CEO Daniel Steinfeld. He adds, “People deserve a choice when they make the biggest financial decision of their life. They also deserve clarity about every aspect of the transaction. We provide that.”

While the auction platform is the most distinguishing feature of this premium brokerage, there are several other features that the company believes will set it apart from the traditional brokerages in Ontario.

There is a ‘No Double Ending’ policy that ensures both sides of a transaction are never represented by the same Realtor. President and Broker of Record Katie Steinfeld says, “It is impossible to fathom that people with perfectly opposite financial objectives could have their best interest adequately represented by the same person.” She continues, “This is especially so when that individual stands to make more money by being on both sides of the transaction.” While the Ontario government and real estate industry have diverted from the point of protecting the consumer’s best interest, On The Block has done what makes the most sense – disallow the concept from their business model.

Prospective buyers without representation can still fully participate in a purchase or bidding process, but will not have a client relationship with On The Block – and if they choose to purchase without representation, there is no additional commission payable by either the buyer or the seller. “Buyers are entitled to an understanding of how commissions work. Just because it is widely positioned that the sellers ‘pay’ commissions, that cost is directly coming out of the sale proceeds, and ultimately a cost to the buyer,” Mrs. Steinfeld explains. On The Block’s Transparent Commission Policy explains that buyers should only pay for the service they receive, and so purchasing without representation shouldn’t cost them the extra 2.5% that often get baked into the purchase price.

Beyond the increase in transparency, the company provides a first of its kind ‘all inclusive’ approach to selling a home. One of the most unique included features is that homeowners are given a week in a partner hotel during the selling process to take away the stresses of cleaning and constant vacating that come with showings of the property. This is in addition to perks including professional photography, home inspections, and one of a kind custom signage for every property. “We are trying to sell a home, not ourselves,” Mr. Steinfeld says. “The high end signage is the largest legally allowed, and it is completely focused on the property it is trying to sell, not the brokerage or the name of the sales representative.”

Interested sellers are invited to use the platform at an introductory rate that includes all the bells and whistles, but costs less than half of what traditional Realtors charge.

It has been well documented that the real estate market could use a new approach. Perhaps this is the big change everyone has been waiting for.

About On The Block

On The Block is a premium real estate brokerage and auction house offering prospective home sellers the option to sell by auction or traditionally. As platforms like Uber and Airbnb have disrupted their spaces, On The Block is positioned to challenge a real estate process that for too long hasn’t seen significant change. With home prices continuing to fluctuate widely, and affordability diminishing, it’s more important than ever to give people some choice and power in the biggest selling and purchasing decisions of their lives.

Posted by on Oct 18, 2017 in Auctions, Jim's Take on the Market, Listing Agent Practices, Why You Should List With Jim | 1 comment

‘Coming Soon’ Defined

The ‘Coming Soon’ tactic has been around for a few years now – long enough that it’s become an accepted part of the murky, unregulated landscape, just like short-sale fraud. Because there is no enforcement of the rules or laws, we have to trust that agents handle it ethically. Here the National Association of Realtors cops out and pins the decision on the seller:

From N.A.R.

What does it mean to advertise a property as “coming soon”? The answer to that seemingly simple question varies among agents, brokers, MLSs, and state regulators nationwide. While the real estate industry has not agreed on a definition of “coming soon,” one thing is certain and consistent — a broker’s decision to market a seller’s property as “coming soon” must always be made based on the client’s informed determination of what best serves the client’s interests.

Some “coming soon” advertisements involve unlisted properties that may or will be listed with a broker in the near future, while others relate to properties that are subject to listing agreements where property is available to potential purchasers only through the listing broker and not available, temporarily or indefinitely, for showing or purchase through other MLS participants. In either case, “coming soon” properties are commonly withheld from the MLS.

The first important step in advising a seller-client on whether to advertise a property as “coming soon” is to identify the client’s best interests, as defined by the client. Failing to act in the client’s best interest and failing to disclose the pros and cons of a limited marketing plan, such as “coming soon” advertising, can violate state real estate license laws and regulations, MLS policies, and the REALTOR® Code of Ethics.

For most sellers, getting the highest possible price on the best terms is their “best interest,” and maximizing exposure of their property to potential buyers advances that interest. Multiple Listing Services promote the interests of sellers by compiling property information in an orderly manner and distributing that information to MLS participants who have buyer-clients actively seeking to purchase property in the location served by the MLS.

Restricting the marketing of a seller’s property to only small networks, private clubs, or even to national websites without also making it available to other area brokers and agents and their buyer-clients through the MLS results in the property not being exposed to the widest group of potential willing and able buyers, and may not provide the seller the best opportunity to attract offers at the highest price.

It’s important that sellers understand the implications of various ways of marketing the property so that they can knowingly determine the choice that best serves their interests.

If a broker determines that “coming soon” advertising is in the client’s best interest and confirms that the client understands the possible consequences, then it’s imperative for the broker to know the state’s real estate license laws and regulations to ensure that such advertising is in compliance. A broker who fails to comply with state laws and regulations risks facing disciplinary action from licensing authorities, as well as the possibility of litigation from unsatisfied clients.

Read More

Posted by on Oct 12, 2017 in Jim's Take on the Market, Listing Agent Practices | 3 comments

Off-Market Sales

Two things never discussed about off-market sales:

1) Every agent signed an agreement to share their listings with other agents.

2) Nobody reads the forms before signing.

http://www.berkeleyside.com/2017/09/26/sell-east-bay-home-off-market-probably-not-exceptions/

When Barbara Hendrickson’s 90-year-old neighbor needed to sell her Berkeley home, crammed with 40 years’ worth of belongings, Hendrickson, a real estate agent, sold the house for her without putting it on the market.

“She was not up to the task of cleaning out all that stuff,” said Hendrickson, an agent with Red Oak Realty. The off-market sale enabled the neighbor to quickly dispose of the house and move to Baton Rouge to be closer to relatives. The buyers took on the onerous job of clearing out the accumulated furniture and possessions.

In general, selling a house off-market isn’t the best approach, experts say. The California Association of Realtors recommends against it, as do East Bay agents including Hendrickson. But sometimes, as in the case of Hendrickson’s neighbor, there are exceptions.

To be clear, “selling off-market” means not listing the house on the local Multiple Listing Service, and is also described as off-market sales or pocket sales.

Read More

Posted by on Sep 27, 2017 in Jim's Take on the Market, Listing Agent Practices, Realtor, Realtor Training, Realtors Talking Shop | 6 comments

Off-Season Selling

The pricing triangle above demonstrates the importance of an attractive list price.  These percentages are probably cut in half during the off-season, but there are still buyers – I’ve run into two bidding wars this week!

https://www.keepingcurrentmatters.com/2016/02/29/how-to-get-the-most-money-when-selling-your-house/

Excerpted:

Instead of the seller trying to ‘win’ the negotiation with one buyer, they should price it so that demand for the home is maximized. In that way, the seller will not be fighting with a buyer over the price, but instead will have multiple buyers fighting with each other over the house.

Realtor.com, gives this advice:

“Aim to price your property at or just slightly below the going rate. Today’s buyers are highly informed, so if they sense they’re getting a deal, they’re likely to bid up a property that’s slightly underpriced, especially in areas with low inventory.”

Get Good Help!

Posted by on Aug 30, 2017 in Jim's Take on the Market, Listing Agent Practices, Thinking of Selling?, Tips, Advice & Links, Why You Should List With Jim | 0 comments

“Why Are You Selling?”

From realtor.com:

http://www.realtor.com/advice/sell/why-are-you-selling/

“Why are you selling your house?” might seem like a perfectly innocent question from home buyers, but watch out—if you’re the home seller they’re asking, this is one of the diciest questions you can answer.

The reason: Pretty much any explanation you give is bound to contain revealing info that these home buyers could use against you, thereby compromising your negotiating power.

So, what’s a bad answer?

Well, there are many, actually, like these doozies below.

  • ‘I got transferred for my job’

This is one of the most common reasons why people sell their house. In fact, 17% of people surveyed by the moving company Allied Van Lines said they’ve been relocated for a job. Nonetheless, revealing this to home buyers could make them think that you’re desperate to sell fast and, in turn, lead them to make a lowball offer.

  • ‘Our family needs a bigger house’

Trading up? Don’t relay that to home buyers. The reason is pretty simple: “You don’t want to give buyers the idea that the house may not be enough room for them, either,” says Crawford. Similarly…

  • ‘Now that our children have left the nest, we’re ready to downsize’

Downsizing makes total sense for empty nesters and retirees, but likewise, you don’t want home buyers to think that your house is too large and difficult to maintain.

  • ‘We need a smaller mortgage payment’

There are a couple of reasons why this response is a bad idea. First, you don’t want to give the impression that the house is too expensive or overpriced. Second, you don’t want home buyers to presume that your finances are in such poor shape that you’d accept a lowball offer. Put simply, “Never discuss your financial situation,” says Beckman.

  • ‘We’ve already bought our next house’

If you want to fetch top dollar for your house, don’t divulge that you’ve already purchased your next home. “It makes the home buyer think that there’s a sense of urgency and that you have to sell quickly,” says Crawford—which is a valid assumption, considering that a lot of people can’t afford to carry two mortgages at once.

  • ‘We want a quieter neighborhood’

Steer clear of saying anything that could paint the neighborhood in a negative light. Even saying that the area is quiet could backfire. “You don’t know what a home buyer wants,” says Beckman. For instance, some people are drawn to areas with a hopping night life (and the noise that entails), or at least a place where the streets aren’t barren by 8 p.m.

  • ‘We need to move closer to our parents to help care for them’

Many people move to be closer to family—and in some cases, it’s out of necessity. However, there’s no need to share that information with home buyers, since this suggests you have to sell your home pronto.

  • ‘My back problems make it too difficult for me to climb the stairs’

A number of home sellers move out of two- or three-story houses for health reasons. However, you don’t want to draw attention to the fact that there are a lot of stairs throughout the home, since it could scare off older home buyers or home buyers with young children.

  • ‘Our utility bills are through the roof’

Energy-efficient home features are all the rage nowadays, which makes sense when you consider that home owners spend on average $1,945 a year on their energy bills. But some home buyers still overlook utility costs when they go house hunting. So, the very last thing you want to do is draw attention to the fact that your gas or electric bills are expensive.

  • ‘The house is too difficult for us to maintain’

No one wants to buy a money pit. So, even if you’re selling a clear fixer-upper, don’t mention maintenance costs to a home buyer. Also avoid talking about repairs that you just never got around to making, like repairing the bathtub caulking, as well as big projects like replacing the 20-year-old water heater—all reasons for home buyers to think twice about making an offer.

Posted by on Aug 29, 2017 in Jim's Take on the Market, Listing Agent Practices, Thinking of Selling?, Tips, Advice & Links, Why You Should List With Jim | 10 comments

Boomers Causing Gridlock

Hat tip to daytrip for sending this in!

LINK

An excerpt:

People 55 and older own 53 percent of U.S. owner-occupied houses, the biggest share since the government started collecting data in 1900, according to real estate website Trulia. That’s up from 43 percent a decade ago. Those ages 18 to 34 possess just 11 percent. When they were that age, baby boomers had homes at almost twice that level.

Public policy contributes to the generational standoff. Property-tax exemptions for longtime residents keep older Americans from moving. Zoning rules make it harder to build affordable apartments attractive to senior citizens.

“The system is gridlocked,” says Dowell Myers, a professor of urban planning and demography at the University of Southern California. “The seniors aren’t turning over homes as fast as they used to, so there are very few existing homes coming online. To turn it over, they’ll have to have a landing place.”

Read full article here:

https://www.bloomberg.com/news/articles/2017-08-08/baby-boomers-who-won-t-sell-are-dominating-the-housing-market

Posted by on Aug 9, 2017 in Boomer Liquidations, Boomers, Jim's Take on the Market, Listing Agent Practices | 5 comments

Private Club for Realtors

There is one solution that would solve everything – start a new club.

It was probably no accident that Mauricio ran this again on his Instagram yesterday, and it is a fantastic idea:

They are advertising it as a pocket-listing website, but it could go big and offer the industry a viable alternative to the current MLS system.

A wanted and needed alternative!

It might take a few months to catch on, but think of the effects:

  1. Privatize the marketplace, and force consumers to work with agents who are club members.
  2. Privatize the market data, so only the club members have the comps.
  3. No listing feeds to Zillow or other real estate website, resulting in no public access to listings.
  4. Brokers could only charge agents a reasonable admin fee, instead of big splits because all agents need is to be in the club.
  5. The N.A.R. and all other blood-suckers are eliminated.
  6. Club members in full control of market, with no rules or ethics.

Only agents can join, and let’s make club membership extremely expensive so only the top agents could afford it, which would eliminate the lousy agents. If the cost was $2,000 per month, it would cull the herd immediately.

The only reason there are so many pimps making millions off agents is because we let them. We should take back our listings, and control our own destiny!

All it would take is a celebrity realtor to create it, and off we go!  Revolution!

Posted by on Aug 9, 2017 in Jim's Take on the Market, Listing Agent Practices, Revolution, The Future | 8 comments

Zillow vs. Redfin?

Spencer took a crack at Redfin yesterday, and more:

LINK

An excerpt:

Zillow Group CEO Spencer Rascoff isn’t worried about the threat of newly-public Redfin — but he thinks the rest of the real estate industry should be.

He made that clear during a conference call associated with Zillow’s second-quarter earnings Tuesday in which he went so far as to say that Redfin is a “threat” to the traditional real estate industry.

“Undoubtedly, one of Redfin’s goals is to obviate the buyer’s agent,” Rascoff said on the call. “I think they have stated, quite publicly, that they aim to acquire more listings inventory in given markets, and then have no buyers’ agents on the other side of those listings. And that is a threat to organized real estate, and that’s one of the many reasons why brokerages are so concerned about Redfin.”

With N.A.R. on the sidelines, traditional realtors won’t mind somebody taking up the fight against Redfin – and Spencer could wind up being the hero!’

In this era of fake news, we can expect both sides to continue their bending of the facts too, which could get ugly.  Who will consumers believe?

Posted by on Aug 9, 2017 in Jim's Take on the Market, Listing Agent Practices, The Future, Zillow | 0 comments

Big Brother Real Estate

Hat tip to reader MF who sent in a note about this latest 3.0 release.  If it wasn’t already obvious, our industry has more information on you than ever:

With PropertyRadar 3.0, you can have unlimited, always up-to-date contact information with your subscription, including:

  1. 40 million phone numbers for property owners and their spouses.
  2. Spouse Owner/Joint Owner Contact Details
  3. Links to Social Media Profiles
  4. Profile Pictures from Social Media
  5. Gender, Age & Date-of-Birth
  6. Ethnicity & Language
  7. Household Income & Household Net Worth
  8. Presence of Children & Age of Children
  9. Interests & Affiliations

We’ve known about your mortgage history for years, and now it’s really getting personal.  Realtors are building teams of people to help process this data, and seek out those who are most likely to move. Don’t be surprised if you see realtor marketing that feels a little creepy!

Posted by on Aug 2, 2017 in Jim's Take on the Market, Listing Agent Practices, The Future | 3 comments