Right at the end of the radio-show video, I said that sellers should hire a listing agent who also represents buyers – my suggestion was a 50/50 split. The host questioned the idea, and at first glance it would seem to make sense for a seller to hire a seller specialist.
Let’s review the reasons why my idea is worth considering. Throughout the process, the listing agent’s job is the represent the sellers’ best interests – no question there. Here’s my point:
A listing agent who has empathy for what buyers are experiencing will better represent the sellers’ best interest.
Here are examples of how listing agents who don’t work with buyers can cost their sellers:
- Having to grind out a couple of extra bucks from the buyer. Recently I representing a buyer who was trying to purchase a home from the kids who inherited it. The parents had bought it in the 1970s, so there was close to a million dollars in equity. After a longer-than-necessary negotiation, the last volley from the sellers was to punk us for an extra $5,000 on price. There was no justification for it, and while irritating, somebody had to be the better person. My buyer reluctantly agreed to pay the higher price, but it didn’t sit well. The minute we found one thing wrong with the house, my buyer cancelled without discussion – and I didn’t mind. We don’t know if it was the sellers or agent who insisted on the extra $5,000, but if it was the sellers then a listing agent who had empathy for buyers could have counseled them about the hazards.
- Listing agents who also work with buyers are actively looking to find their own buyers, instead of waiting for other agents to do the work.
- Agents who work with buyers have seen the comps, inside and out. They have better knowledge about why a comp sold for the price it did, especially if it was extraordinarily high or low.
- Agents who only do listings don’t hear the objections buyers have about defects in general, and won’t price them accurately.
- The more agents do listings only, the more arrogant they become. They will only sell their listings on their terms, and if a buyer doesn’t like it, then too bad – no deal. Because they have several other listings, if one doesn’t sell this week, it won’t change their lifestyle. In a hot market, they get away with it. But not every market will be hot forever.
Most listing agents don’t appreciate buyers, and what they have been through. Instead, they think their job is to work them over. But you still have to make it to the finish line, and buyers who feel like they’ve been mistreated will demand a discount – or find a reason to cancel.
The big agent teams are the hardest to figure, because they will show buyer sales on their Zillow page. But usually the team leader isn’t doing the heavy lifting – they have underlings who handle the buyer sales. The ‘neighborhood specialists’ who mail you every month? All you know is that they are excellent at licking stamps – many agents get in the way of a successful sale. Conduct a thorough investigation of the agents you are considering – at least check their Zillow page!
Why does it matter?
If your local market hits a flat spot, and you only get one offer – you want an agent who treats the other side right, so the deal sticks.
What’s the chance of that? Take a look at my 1-minute wrap-up yesterday: