Friday, September 27, 2013

Selecting the wrong listing agent can (cost you dearly) (bruise your bank account) (ruin your chance of profit) (destroy your profits) (be a very costly mistake) etc.

The Wall Street Journal recently published results of a study showing experienced agents sell homes for an average 12% more than their less experienced counterparts. According to the article, this amounts to an average sales price gain of about $25,000. You can find that it here if you're interested.

But selecting a poorly qualified listing agent can cost you much more.

Earlier this year, I represented a buyer who wanted to find a home on Chattanooga’s thriving South Side. She mentioned she had driven past a house and seen the For S
ale sign, but could not find the listing in the Multiple Listing Service (MLS).  My research discovered that the listing agent had entered the wrong zip code for the property, and therefore potential buyers did not find it on searches of the MLS, Zillow, Trulia or similar web sites.  In addition, the listing agent had only posted one (very sloppy) photo and had significantly understated the actual square footage of the property.

During phone conversations, the agent demonstrated little insight into new construction, failing to recognize the term “C.O.” (certificate of occupancy). As a result, we were able to negotiate a sales price for the buyer approximately $50,000 below the actual market value of the home, creating $50,000 of instant equity for the buyer (and that amount of lost profit for the seller).

Picture is not unrelated.

In the Wall Street Journal article, Bennie Walker, Professor of Finance and Real Estate at Longwood University, points out “the more experience you have, the more likely you are to sell the properties that you list, the more likely you are to sell it at a higher price and the less time it stays on the market.”  

Experienced agents have greater knowledge of neighborhoods, a larger network of buyers and sellers, and well developed relationships with home inspectors, appraisers and mortgage brokers. These connections can also really make a difference, and should be considered when you are deciding on who will represent your interests when it comes time to sell.

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