My neighbor listed her house about a year ago (not with me unfortunetly, or fortunetly depending on how you look at it but that's for another time). Anyway, the house was a mess, she was the daughter of the original owner and inherited it when they passed. She has been living there with her extended family (i.e. daughter, grand daughter etc.). NOTHING, and I mean NOTHING had been done to the house in 50 years. I'm talking original 50's tiles of varying shades of pink and yellow in the bathrooms. Commercial grade carpet over beautiful hardwood floors and a basement that had extensive water damage to the ceiling tiles from years of broken pipes and smelling like a smoke infested bar on a Saturday night. She originally listed her house for what homes in better shape in the neighborhood had been sold for, one of my listings included. Of course she got no bites and promptly switched agents. She somehow wound up with a listing agent, who surprise surprise has a small construction business on the side. Needless to say, he talked her in to investing more than $35K on a new kitchen (with his company of course) but does no other improvements to the house. He then jacks up the price to reflect the investment taking it way over the comps for the area. Keep in mind the house has now been on the market over half a year!
The house continued to sit on the market for over 300 days and finally went under contract. The owner had to ultimately drop the price $20K below where she started from originally before the renovation! My point to all of this is that I feel real estate agents that have businesses like renovation companies have other agendas. In my opinion she could have gotten the price she ultimately came down to without the investment for the renovation encouraged by the listing agent who stood to make the profit.
Would he have recommended the renovation if it wasn't his company doing the work? Or would he have pushed her to make the less expensive fixes the house needed to net the lower price she eventually had to accept.
Does one's professional judgement get clouded when you have your mind on other business matters? I for one believe it does and would be leary of agents who "double" as contractors. This is not to say all are bad or dishonest but think about it. Are they really acting in the best interest of their client or for themselves?
Just a thought.
Comments(1)