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Charleston real estate

The value of buyer representation

By: Howard Arnoff
Wednesday, November 14, 2007 8:24 PM

I noticed some interesting commentary regarding representing sellers vs. buyers lately. I’ve been a little busy (thankfully) trying to top off the year getting one more contract to closing but thought I’d chime in with a few thoughts.

 

My broker suggested at our meeting today that we should not take an overpriced listing, should not write a listing agreement for longer than 90 days and would be better off being the third or fourth agent selected to list a property. It’s all about the high cost of time and money.

 

I’ve sold most of my listings but not by selling the property a buyer but by marketing. The most recent listing that I took is well priced, has had showings, has been a finalist, but it just hasn’t gotten a contract as yet. I’m comfortable with that considering the market, it’s realistically priced and the condition is excellent.  Another agent competing for the listing basically promised to personally bring the buyer. The agent likely over promised an outrageously high price as well but thankfully, my clients didn’t feel comfortable and chose me. Very old school, I’m sorry but this is a new era in real estate.

 

We’re witnessing a mass exodus from the industry as those who joined during the good times find hard times to be too difficult to earn a living. Those who can adapt to the new paradigm will be the beneficiaries of the good times that once again will ultimately occur.

 

The Internet has allowed buyer agents to attract quality buyers to help them very early in the buying stage. These consumers are not interested in calling yard signs (virtual or otherwise) but prefer superior representation in the buying process. They are more interested in learning about the area, schools, neighborhoods and lifestyle. They want information, they want expertise and they want buyer representation.

 

I’ll vote with my friend and colleague, Mike Farmer. What do you say.
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Comments

Craig Barrett
Member Since '07

Craig Barrett said:

I say I agree Howard.

November 14, 2007 8:21 PM
Gary Szolosi
Member Since '03

Gary Szolosi said:

Howard, Like you I seldom disagree with Mike. He has the grasp of the real world and a way to communicate it. Your Broker sound as though he is in tune as well. It does not surprise me that as a Professional you are making it through these times. The cream always rises.

November 14, 2007 9:00 PM
Mipeco Realty, Inc -  Michaela Krestenic, Broker-Owner
Member Since '03

Mipeco Realty, Inc - Michaela Krestenic, Broker-Owner said:

Howard, I have to agree with just about everything above except for the length of the listing agreement. In our area, properties are sitting on average for anywhere from 6 - 12 months in most cases, even when priced very well. So as much as I used to believe in 3 month listings, I now prefer longer listing times. On the other hand, I would not want to be "stuck" in a listing contract for 12 months. These days, I do somewhere in the 4 - 6 months range, at which point I go back to the seller and either renegotiate the contract, reevaluate the pricing, or whatever else needs to be done.

It is the full time agents who are hit the worst right now ... the part-timers don't have to rely on their real estate income as much and seem to be weathering this storm a little better.

November 14, 2007 9:55 PM
Dennis  Jonas
Member Since '07

Dennis Jonas said:

It's the listing that drive the buyers to the internet.  NAR states that over 80% people now use the internet to find a home.  You must ask yourself the question, will these potential buyers e-mail me off of my picture and want to work with me if I have no listings.  Buyers that use the internet, start their buying process about 6 months before they purchase.  I'll bet they are looking at listings not agents.  After 30 years in this business, I've meet very few sellers that didn't think their house wasn't special.  Working with sellers and educating the seller is just as important in today's market as it is working with buyers.

November 14, 2007 9:55 PM
Gregory Bain
Member Since '03

Gregory Bain said:

Dennis, how many handshakes did you do on your P2A site with someone that has NO LISTINGS? It's too late to put the cork back in the bottle. The magic genie is gone. If the agent doesn't have the listing, he is buying back your lead from some dirt bag "referral" company.

November 14, 2007 10:05 PM
Gregory Bain
Member Since '03

Gregory Bain said:

Gary, you know present company is excluded when I say it, but when you work in a cesspool you notice that the scum also rises. We need a little bacteria treatment.

November 14, 2007 10:11 PM
Gary Szolosi
Member Since '03

Gary Szolosi said:

Greg again you make a valid point. It is all how you view it. Dennis feels that if you don't go after listing you will loose. I don't want to tell Dennis that I own 2 franchises and until two years ago I only took a listing if someone called me and begged me. I had Buyers agents because that is how I started. You could have no listings with Point2 and capture as many buyers as anyone that is a listing agent because of handshake. So Dennis look at the real world. Spend some time teaching your agents how to be buyers agents as well as listing agents. The market will turn again and you will need to be both, as you do now. 50% of anything is not as good as 100%, I think you will agree.

November 15, 2007 1:08 AM
Howard Arnoff
Member Since '03

Howard Arnoff said:

Michaela, as to 3 months, his thinking is that he doesn't want you to commit to spend marketing money if the listing will languish. With the right property at the right price and a seller who understood market conditions, I'd ask for a year so you have to go on a case by case basis. As to part timers, the client gets what they pay for. And if we are on the other side of the transaction, we pay the price as well.

November 15, 2007 4:46 AM
Howard Arnoff
Member Since '03

Howard Arnoff said:

Dennis, I'm glad you stopped by and I'm sorry I couldn't participate in a few of your other posts. There is no doubt that listing was the only way to go in the past but the NAR mantra you cite is as stale as David Lereah and Larry Yun declaring the housing market will stabilize and turn up any moment.

Today, I believe that technology has changed the paradigm. I suggest that with buyers now having access to all listings, the agent may in fact be more important the house. And you can demonstrate that to buyers by more than just a pretty face.

Craig, Greg and Gary, always good to hear from you as well. Thanks.

November 15, 2007 4:56 AM
Vance Remele
Member Since '04

Vance Remele said:

Good morning to all..

Can someone Help me out here,

If its a home buyers market, why would it NOT be a home buyers agent market?

In 2004-2005 it was a sellers agent market and listings were flying off the market in a matter of  hours and days.

Why do I need to list homes with a flood of homes to pick from already on the market for my home buyers to pick from, I guess you can say my buyers  can now have the pick of the litter.

With homes sitting on the markets for over a year now and inventory hitting the roof, I personally would not add to it.. up to this point and time.

Being a buyers agent myself, finding and qualifying home buyers is no day beach because of the lenders strict tightening  lending rules, and  has now force some home buyers away...as a matter of fact finding a lender nowadays is not easy.

By focusing on a specific farming area or a neighborhood  or a certain zip code area as in Dennis case in this market has got to be tuff , that is my guess, there is only so much to go around when working in a limited area.

I have never focus in a limited areas, so I maybe wrong so go easy on me.

My main markets are in all of Florida and Georgia.

Howard said:

Today, I believe that technology has changed the paradigm. I suggest that with buyers now having access to all listings.

-------------------------------------------------------------------

I agree with Howard.

Why would I need to have any listings when I have yours.. to show?

I feel that some home sellers expect at times way more from the listing agents over and above what is offered to sell their home..its always the listing agent/agency's fault the home did not sell!

But its not the buyers agents fault that the buyers did not buy a listing.

Showing buyers homes can be a lot of fun, for me it is anyways..

( FYI 99% of what I do is either new homes/condos builder/ developers)

as you may have seen by my web sites.

Well at any rate no matter what your business plan is, if it works for you,  Just Keep On Trucking!!

http://youtube.com/watch?v=Wtnu4rAbmCg

"Best wishes to all over the holidays!!

November 15, 2007 6:48 AM
Mike Farmer
Member Since '03

Mike Farmer said:

Buyers go to the internet because they want to buy a home, but they are also buying an area to live in. So they need information on homes and the best location. They also need financing, and they also need someone to help sift through all the information to put it all in perspective.

A listing on the internet needs context in order for the buyer to make sense of it.

Buyers may, indeed, go to the internet to look at houses. That's one piece of it. That's exactly why I want to be positioned to meet them there. But if all they want to do is look at pictures, then all this is a moot point, unless you could charge them to look. But then they wouldn't be buyers, they would b lookers. Buyers want INFORMATION. That is what some agents are missing.

Buyers don't care how many listings you have, they care how much information you have. They care about how much knowledge of the area you have. They care about how you can help them put this information into perspective. They care that you have access to ALL the listings and know the area well enough to match house with area with price with financing with conditions. They care that you are professional and service-minded.

But they don't care who has the listing.

November 15, 2007 7:21 AM
Mike Farmer
Member Since '03

Mike Farmer said:

To be honest, sellers don't care how many listings you have, or they shouldn't. What matters is how many houses you have sold.

November 15, 2007 7:24 AM
Dennis  Jonas
Member Since '07

Dennis Jonas said:

Very interesting! Listing agent vs buyers agent.  I just starting using this media to commuicate with agent through the P2A system.  I hope that when I post an opinion that I don't have to hide behind the picture of a guest.  That must be the "Lone Realtor" fighting for justice for all.  I would like to thank each and everyone for their response on some of my postings, I don't always agree with you and I know you don't always agree with me.  But, I still take away some additional knowledge or perhaps the thought to re-think my approach.  I have learned some valuable information from many of you already.   Thanks for taking time response to my posts, be it positive or negative.  

Dennis

November 15, 2007 7:45 AM
Vance Remele
Member Since '04

Vance Remele said:

Well for the most part,after reading all the postings myself , I have learn from them also and I will just stay on my course...

Vance

November 15, 2007 8:15 AM
Mike Farmer
Member Since '03

Mike Farmer said:

For me, it's not a matter of listing agent versus buyer agent, it's understanding my responsibilities in each role. It would be just as misguided for me to say you can't last in this business unless you become a buyer agent. A listing agent who does good at getting and selling listings might never work in the role of a buyer agent and do very well. But the reverse is true, an exclusive buyer agent who never lists can last and be successful. I have chosen to do both because it seems appropriate for a well-rounded approach. I do believe now is the time to concentrate more on the buyer side, yet still maintain a few listings that make sense.

The problem comes in when the old idea about having lots of listings to be noticed and generate buyers is put forth as the only way to go.

But it's not a war between buyer agents and listing agents.

November 15, 2007 8:29 AM
Craig Barrett
Member Since '07

Craig Barrett said:

No, Dennis you don't have to hide. I do appreciate the various viewpoints and the subsequent dialogue.

November 15, 2007 8:30 AM
Mike Farmer
Member Since '03

Mike Farmer said:

Disagreement is what makes life interesting.

November 15, 2007 8:37 AM
Mipeco Realty, Inc -  Michaela Krestenic, Broker-Owner
Member Since '03

Mipeco Realty, Inc - Michaela Krestenic, Broker-Owner said:

discussions and disagreements make us think and help us grow.

Dennis, getting comments (positive or negative) and getting people to engage in your posts is what it's all about here. ... when you (don't really mean you personally) start being ignored by the smart guys/gals on Relib that's when you know you're in trouble and it's time for a change ... most likely within :-)

November 15, 2007 8:47 AM
Mary Welch
Member Since '04

Mary Welch said:

Agreed Howard, Mike is all there as are you. I know you have been busy, but still stop by and leave us a note now and then. Good seeing you.

November 15, 2007 8:55 AM
Howard Arnoff
Member Since '03

Howard Arnoff said:

Dennis, you need not hide. Your opinions are welcome, when they are met with criticism, it is not personal. Different points of views serve to enhance the discussion and everyone can learn.

Your 30 years of successful real estate gives you the credibility and right to suggest how other agents can become successful. Whether anyone chooses to accept your advice is their choice. At least you aren't trying to take our cash. As to anonymous posters, in my opinion, they lack credibility.

November 15, 2007 9:03 AM
Howard Arnoff
Member Since '03

Howard Arnoff said:

Mary, thanks and a Happy Thanksgiving to you and everyone at Relib.

Michaela, very well said and I couldn't agree more.

Mike, look forward to meeting you in person, Monday or Tuesday for 18?

November 15, 2007 9:36 AM
Craig Barrett
Member Since '07

Craig Barrett said:

Have a nice thanksgiving too Howard. It's good to see you again.

November 15, 2007 11:44 AM
Jana Davis & Marcia Demerjian
Member Since '05

Jana Davis & Marcia Demerjian said:

Dennis one of the great things with P2 is our handshake.  We don't need listings of our own to have buyers visit our website.  But I don't really see the benefit of a argument here.  Buyers and Sellers are our business.  So to exclude one or the other just doesn't make sense to me.

Jana

November 15, 2007 12:55 PM
Mike Farmer
Member Since '03

Mike Farmer said:

Let's make it Tuesday. Email me with time and place.

BTW, great post.

November 15, 2007 1:45 PM
Howard Arnoff
Member Since '03

Howard Arnoff said:

Jana, you make an excellent point, we represent both buyers and sellers. I've always been a little better on the buyer agent side and that is especially helpful in today's market. Thanks Mike.

November 15, 2007 2:06 PM

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