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The Black Hat Realtor or The White Hat Realtor

By
Real Estate Agent with Westbrook Realty Broker-Owner

You know the saying about good guys finishing last, well, I'm not so sure. This recent scenario is

 pretty typical of a dilemma the real estate agent faces every day.

 

I recently went on a listing appointment. It was a referral from a very happy past client, the home was

about 6 years old, professionally decorated and had many extras. A very nice house to have listed.

 EXCEPT...the seller didn't want to move right away, they wanted to list  this spring and move in

November.

 

                               meeting table

 

 

I did my CMA and told them their price would be around $300K as the BEST possible outcome. The

 house next door just sold for $270K and they included a $10K item of furniture to seal the deal!

I was firm about my price, but I conceded we could start at 310K or 315K, if they wanted to test the

 market for a few months.  

                                                        black white hats

                                                                                                             

They interviewed two other agents who had also been recommended. They went with the agent

who told them it would sell for $330K. That is what it is listed for on our MLS now. 

 

Real estate agents have to make a decision at the presentation. Do we want to buy the listing at

the higher price and deal with a disappointed seller for 6-15 months? The other option is to be firm

and if the business comes your way it will be salable and you will get paid for your efforts.

 

 I recently listed a home for the correct price and it sold in three weeks for full price.

 

If I had been the Good Guy wearing the White Hat and agreed to their $330K price, I know I could

havegotten the listing. Then during the 5-6 months when they were getting really serious about selling,

we could have lowered the price and it would eventually sell, maybe by spring 2009.         

 

                                              What is the right thing to do?

                    

                                         Telling the seller the truth cost me a listing??    Yes.

 

                                                                  My  Deduction:

                                Listening to the client ---+--- Motivation ---+ -- Price

 

              All of these go hand in hand to come to an understanding with the seller.

 

 I wasn't patient enough to offer the option of setting a higher price and waiting with them to realize

their price was unrealistic. This has been the case with so many listings over the last year and a half.

                                     So I suppose I'm wearing the Black Hat in this Situation. 

 

Or will I be wearing the Black Hat when I list at their price and it still hasn't sold in 11 to 12 months?

 

                                Which hat will you be wearing at your next listing appointment ? 

 

Copyright by Terry Westbrook 2008

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Comments(9)

Mary PAUL, ABR, CRS,GRI, e-PRO,
RE/MAX Advantage Realtors, Searcy, AR - Searcy, AR

Terry,

Good post!  I would have been honest like you.  Overpriced listings usually go through about 3 agents and the sellers think the last agent is a "super agent"  for selling it.  If it had been listed right the first agent would have sold it.  Have a great week!

Apr 16, 2008 04:03 AM
Terry & Bonnie Westbrook
Westbrook Realty Broker-Owner - Grand Rapids, MI
Westbrook Realty - Grand Rapids Forest Hills MI Re

Mary; Thanks for stopping by I am keeping an eye on it and it has not sold.

 

Apr 16, 2008 05:21 AM
Karen Webster...Grand Rapids, MI Realtor
5 Star Real Estate, Grand Rapids MI - Grand Rapids, MI

Yeah, we run into this, too.  And in this glutted market, there's no guarantee that it will sell even when they get the price down where it should be.

They must believe it will sell for a higher price just because they found a realtor to list it for a higher price.  Not smart.

Sometimes it's toughest to tell this to a friend/satisfied past client.

We tend to tell the truth as well. 

Apr 16, 2008 11:22 AM
Terry & Bonnie Westbrook
Westbrook Realty Broker-Owner - Grand Rapids, MI
Westbrook Realty - Grand Rapids Forest Hills MI Re
Karen: In some times the truth hurts and in this case I think the agent is hurting the seller. 
Apr 16, 2008 01:27 PM
Lola Audu
Lola Audu~Audu Real Estate~Grand Rapids, MI Real Estate - Grand Rapids, MI
Audu Real Estate~Grand Rapids, MI ~Welcome Home!
Terry, Excellent analogy.  This is all too common.  At the end of the day, it's always better to have told the truth.  We've had some sellers come back after they fell for the "black hat."
Apr 16, 2008 02:08 PM
Terry & Bonnie Westbrook
Westbrook Realty Broker-Owner - Grand Rapids, MI
Westbrook Realty - Grand Rapids Forest Hills MI Re
Lola: I just want to strangle the other agent for doing what I see as a disservice to the seller but it is just a part of the business.
Apr 16, 2008 03:19 PM
Terry & Bonnie Westbrook
Westbrook Realty Broker-Owner - Grand Rapids, MI
Westbrook Realty - Grand Rapids Forest Hills MI Re
Andrew: I have to make that decision at the listing appointment. If they are motivated and will sign the price reductions then it does make the decision easier.
Apr 20, 2008 03:55 PM
Please Delete Account Please Delete Account
Please Delete Account - Barton City, MI

Hi Terry.  Doing the right thing iisn't always easy but it is the RIGHT thing to do.  We home stagers are in the same perdicament.  I believe so strongly that a home be priced right that my vacant staging quotes are contingent upon the Realtor's agreement that the house is priced accurately for the current market.  I could make money off of the homeowner knowing that the home will sit on the market but I don't feel right about taking advantage of the seller.  For your benefit, I wish sellers had the same courtesy toward their Realtor.  Thanks for the blog.

 

Apr 24, 2008 03:24 PM
Terry & Bonnie Westbrook
Westbrook Realty Broker-Owner - Grand Rapids, MI
Westbrook Realty - Grand Rapids Forest Hills MI Re

Heidi: Price is king in our market and we need to have the home show well but the buyers are smart and will only look at properties that are correctly priced and look great.

Apr 25, 2008 01:36 AM