Is Taking an Overpriced Listing Unethical?
I believe it is. And fortunately my company trained me to see that from the very beginning.
My very first listing appointment ever went very well. It was a FSBO that I had called and previewed several weeks before. The owner called me and said that he wanted me to list it since I had been so professional when we met the first time. I scheduled a time to present a CMA and discuss the listing. It was when I ran the numbers for the appointment that I realized I should have done it BEFORE I called him the first time to preview. His FSBO list price was a full $30,000 about the market price suggested by the CMA (on a $150,000 house!). I checked and double checked and ran it by a couple of agents that I trust and still, $30,000 above.
I went to the appointment and was very honest with him. I showed him all the numbers and explained my suggested list price and he believed me. He was very nice, but still insisted we list it at his price. I told him I couldn't do it and explained all the reasons why;
- It would sit on the market and cost us both money
- It would not get showings at that price
- It would help sell all the houses in his neighborhood before his
- And I explained that I didn't feel right about it; it was not a true picture of the market value and would be deceptive
I turned it down and wished him well. Sure enough, another agent snapped it up at his listing price AND even offered a discounted commission for the listing (that is a whole blog post in itself!)! It sat on the market for 9 months with no price reductions while 3 other houses in his neighborhood sold for market value. Eventually it was withdrawn and as far as I know he still lives there.
It was VERY difficult to turn that down - after all, it would have been my very first listing! But I still do not regret it. I'm thankful I was taught that ethical foundation from the very beginning. It has saved me a lot of trouble (and money) and made it easier every time to stand by my price recommendations and not give in just to have a sign in the yard.
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