Dear Monty: Two big reasons why home sellers shop agents
By Richard Montgomery
Reader Question: We put up a “for sale by owner ” sign over a year ago. We had a couple of low offers. We then contracted with an agent for six months, in which we had showings and critiques. We were one of the finalists with three interested buyers. They all chose other homes. We are looking for a new agent now and have interviewed a few. Each has all the qualities you recommend. Will you pick one for us?
Monty’s Answer: Interviewing multiple real estate agents is the single most important step any home seller can take when selling their home. The fact you did not come in first could suggest it just was not the right customer, the right timing, or a weak agent. It could also be a factor that has yet to be identified. What are the three agents you mentioned telling you? What are they recommending to make the house saleable?
You have all the history in your possession. You know the offers you turned down, and you have showings and feedback from prospects and agents. You have looked them in the eye. It is for these reasons, armed with the right information, that you are the best one to make a choice.
Are you asking Dear Monty to make a choice because you are looking back on your first choice, which did not work out? Do you want to avoid the same mistake again? With some additional insight, let us re-establish your confidence to make a choice easier for you. We may not have picked the same three agents that you have chosen, but your history and experience lend credence to the idea you have made good choices.
Why interview pre-qualified agents?
- Not all real estate agents are good real estate agents. The real estate industry recognizes this fact. The National Association of Realtors (NAR) recently commissioned a report titled the D.A.N.G.E.R. Report through an independent research firm. Real estate agents said, “ The real estate industry is saddled with a large number of part-time, untrained, unethical, and incompetent agents. This knowledge gap threatens the credibility of the industry. ”
- Many real estate agents are not good at evaluating homes. In my home state, Wisconsin, which is one of the leading states in protecting real estate consumer’s interests, Most consumers are surprised to learn there is little or no education in appraisal principles or methodology in either pre-licensing or continuing education for a real estate license. The state leaves appraisal education to the industry, and the industry leaves it to the individual brokerage firms.
Some real estate agents have turned to online websites to do their work for them, which websites have never walked through the home. It is a high-risk proposition for a home seller to depend on one agent’s opinion of value. Especially when one considers that trained, experienced fee appraisers will reach different conclusions on a particular home’s value using far more sophisticated methods than those utilized by real estate agents.
In a separate survey, NAR also reported about seventy percent of home sellers only talk to one agent. Dear Monty advocates home sellers should heed this information, and take a different tact when making their decisions on picking real estate agents.
To summarize three important facts:
- Many real estate agents are incompetent, unethical, or untrained.
- Many real estate agents are not good at evaluating homes.
- Many selling homeowners only interview one real estate agent.
A critical question for home sellers; How can we ensure that our real estate agent brings us the best price? The simple answer is cautious comparison-shopping, including unobtrusive testing of them.
The good news is there are honest, hardworking, and knowledgeable real estate agents in every marketplace. The bad news is it takes work to find them. Agents are well trained to convince you they are the best person to help. NAR’s image problem existed when I entered real estate years ago. My direct experience is some of the agents pointing fingers should be looking in the mirror. In the D.A.N.G.E.R. Report, the agents said: “ large numbers ” of agents are unsuitable.
By inviting three recommended agents into your home and asking them what is the best price and the lowest price your home will bring on the market, and then comparing how they go about actually delivering the answer will go a long way toward making the right decision.
“Richard Montgomery gives no nonsense real estate advice to readers most pressing questions. He is a real estate industry veteran who has championed industry reform for over a quarter century. Send him questions at DearMonty.com.”