Where change makes cents...

Lockbox or No Lockbox?

Sheryl Lynn Webster — Sun, 11 Mar 2007 23:46:00 GMT

Recently I have had two instances where Realtors have entered in to listings without prior permission.

The first one was a simple mistake where the home next door was for sale as well and the Realtor walked in to the wrong house setting off the alarm. Police came and owners were called at work that someone broke in to their home. The major problem was the Realtor never called our office to tell us, and the sellers called us to find out what happened. Then we had to research it from the lockbox to find out who set the alarm off.

The second one occurred when a Realtor was showing a home in the neighborhood and the prospect buyers asked about our listing. He went up to the door to see if anyone was home and when no one answered, he went ahead and used the lockbox to enter the property.

He never called the office or listing agent before or after the showing, we only found out from the Supra report on the lockbox the next day.

When I called to talk to the agent, he did not understand that it was a problem to just let himself in, so I called his broker. The broker replied giggling “well at least your listing is getting showed”. When I questioned him on his agents actions, he said “the lockbox is kind of like permission to show the property if no one if home”. I was again taken back by the way this office feels about lockboxes.

I was under the impression that a lockbox was a privilege only after permission was granted and an appointment is made.

What are your feelings on this as brokers and Realtors?

When are your duties actually over as the listing agent?

Sheryl Lynn Webster — Mon, 26 Feb 2007 23:07:00 GMT

When are your duties actually over as the listing agent?... at the closing table… once the buyer moves in… when your seller is satisfied… how about when the buyer has no further complaints about the property?

Is it the listing brokerage's responsibility to make sure the property is free and clear of all defects? An agent with our office has a “sue happy” Buyer that wants $15,000 to repair items after closing because he says he was not told about problems that the Seller claims they had no idea about.

Now, I’m not talking about a Buyer we represented, I am talking about a Buyer that purchased a property from our Seller and worked with another broker. The Seller completed every possible disclosure and the Buyer signed off on them, the Buyer had all the inspections and re-inspections completed and still feels the listing Broker and the Seller are at fault for problems found after closing.

This has happened to me in the past and I’ve seen it happen to many others over the years. How far is one to go?

Incentives vs. Price Reduction?

Sheryl Lynn Webster — Sun, 11 Feb 2007 12:59:00 GMT

Many of my Sellers are asking if they should consider offering incentives to make their listing stand out.

My first thought is, it just may, since the developers in the area have inundated the market with their gimmicks and price breaks. They have been offering “Bring a Dollar to Closing” and “All closing costs & 1 year of HOA fees paid”. I even seen “We’ll pay the mortgage for the first year!”

Then I wonder if Buyers are actually buying in to these publicity stunts. There is usually a catch, like they must use their title and/or mortgage brokerage. Anyone with common since knows that they are still paying for it somewhere!

The only safe way I know how to answer this question is by asking questions…

What’s more important to a Buyer… the price they are paying OR how easy it is to get in to the home? Does the answer to this question vary depending on the price point?

Every Buyer is different.

I ask them which home would they buy: A $400,000 home or a $410,000 with the Seller offering $10,000 towards closing costs?

I tell them, “To you as a seller it is just like a price reduction, your bottom line is still your bottom line. You will net the same either way.”

I’m very interested in hearing other ways to approach this or recommendations to discuss with a Seller.

Is it really only worth what buyers are willing to pay?

Sheryl Lynn Webster — Fri, 09 Feb 2007 01:34:00 GMT

Have you ever told a seller, “Bottom line, it's only worth what buyers are willing to pay?” Well it seems this market is surely putting that old saying to the test.

Sellers in many of our areas have been use to their home’s value increasing steadily for so long, that it is hard to convenience them to price their home at what the market is bearing today. They seem to believe whole heartily that their lovely home is worth more than what anyone is willing to pay for it nowadays.

What to do, what to say?

At times I feel they are right, and want to tell them that, “since Buyers in this market are finding better deals, let’s consider renting your property for awhile until the market allows you to contract for what you feel it is worth.”

Yet, most of the time the home is just not worth what they think it is and I must sit them down for a heart to heart.

My favorite way of handling this conversation with a Seller is to present the facts and simply ask the seller, “If you were a Buyer, looking at only this information here, what would you offer on this home right now, today?” They always surprise me with their answers.

I love to show Sellers what a Buyer’s payments would be as well. I let them know that it is a good idea to know what the payment will be on this home…if they price it at X dollars. I explain that selling the home will normally trigger a reassessment of the taxes, and insurance will be higher based on the purchase price. For example:

“You say your PITI is currently $2109, correct? Assuming your Buyer has A++ credit, a super income to debit ratio and finances $515,000 for your home, the new PITI will be around $3987. As a Buyer, can you see paying $4,000 a month for this home?” I usually get a speechless seller at that point. They usually have never thought about it that way before.

Personally I would rather the sellers know the facts upfront than regret working with me down the road. I also want to make sure I am not losing my shirt & creditability advertising an overpriced listing.