Maryland and Virginia Real Estate and Homes Blog

THANKS! TO ALL OF THE HARD WORKING LISTING AGENTS OUT THERE WITH PROPERTIES FOR SALE.

WHAT WOULD A BUYER’S AGENT DO WITHOUT HOMES TO SHOW?

I JUST SPENT THE WEEKEND SHOWING HOMES TO A LOVELY BUYER FAMILY IN LOUDOUN COUNTY.  Business may be slow for all real estate agents and brokers, but, I can tell you from experience, that this market must be a lot harder on listing agents than buyers agents. 

BUYERS AGENTS AND BROKERS ARE NOT FACING THE CHALLENGES EXPERIENCED BY LISTING AGENTS AND BROKERS IN TODAY’S REAL ESTATE MARKET PLACE.

THERE!!!  I SAID IT.  Of course, I have always admired the skill and hard work of good listing agents.  Without them bringing good homes to market, what would we buyers agents sell??

TIMES HAVE CHANGED.  Who would have thought a few short years ago that listing agents, which includes about 95% of all licensees, brokers and agents, would be faced with the complexities of learning about foreclosures and short sales for the first time. 

• SHORT SALES as a routine market segment.
• FORECLOSURES as a larger percentage of listings than at any time in memory.
• SELLERS who believe that the real estate market hasn’t moved since early 2005.
• BUYERS who believe that any listing will be half the price next month.

LISTING AGENTS CAN’T JUST PUT THEIR HEAD IN THE SAND.  What does an experienced listing agent tell home owners who are faced with the prospect of not being able to compete with the Short Sale and Foreclosure listings in their neighborhood in price.  What do they tell sellers who wish to move up to a new home or larger home after 3-4 years in the town that they planned on owning for only a couple of years. 

LISTING AGENTS ARE OFTEN THE FIRST TO BEAR THE BAD NEWS.  How does even the most experienced listing agent tell a home owner to whom they sold their home 3-4 years ago that, even if a buyer would pay their desired price, the property would not appraise?

HOW DO AGENTS PRICE PROPERTIES IN TODAY’S MARKET?  What does a listing agent do when they research a property for a listing presentation that homes in the neighborhood are now selling for 3/2 of what the owners paid 3 years ago?

I KNOW YOU LOVE THAT LILAC DINING ROOM, BUT. . . . How does a listing agent tell sellers who drop in to an Open House that there are 6 homes in the neighborhood that are priced more attractively and in better condition, but this home is priced based on what the owners owe and the children selected the color of the paint on the walls.

IF I GIVE YOU THE LISTING, WHAT ARE YOU GOING TO DO FOR ME?  How much is the listing agent supposed to spend for advertising in the newspapers, magazines, etc. knowing full well that the most likely buyer will come from the IDX or MLS through a co-operating agent.  Of course, there are listing agents who excel in the real estate market place of today.  However, I suspect that even they would admit that it is a lot harder than in the “Halcyon Days” of years past when listing a property usually meant selling a property.

WHAT HAPPENS WHEN A HOME BUYER LOOKS AT ACTIVE LISTINGS ON THE INTERNET?

In my area for homes priced between $150,000 and $750,000, prospective home buyers are going to see:

• FORECLOSURE LISTINGS, which are going to be priced about 10% lower than regular listings.
• SHORT SALE LISTINGS, which are going to be priced about 10-25% lower than regular listings.
• REGULAR LISTINGS which are going to be priced about 20-35% higher than the foreclosures and short sales. 

FOR SIMILARLY LOCATED SIZE AND LOCATION, the foreclosures and short sales are the homes that the prospective home buyer asks to tour.   Of course, we could look at the comparable listings and include some “regular” listings in the tour, but it doesn’t take long for a buyer to see the value in the foreclosures and short sales.

BUT, WHAT ABOUT CONDITION?  When a property is priced 25% lower than 75% of the listings in a community, the buyers will consider anything other than structural defects, mold, wet basement, etc. to be nothing more than cosmetics that they can take care of themselves. 

IT’S ROUGH OUT THERE.  I SUSPECT THAT FEW LICENSEES TRULY UNDERSTAND HOW ROUGH IT IS THAN LISTING AGENTS IN A MARKET WHERE HOME PRICES ARE FALLING DAILY. 

ALL I can say to the listing agents in my market is:

THANKS!  GOOD JOB. 

Courtesy, Lenn Harley, Broker, Homefinders.com, 800-711-7988.