RESEARCH RESULTS FROM LOUISIANA HOUSE HUNTING
13 Most Common Reasons a Home Doesn’t Sell
Last month we called 150 homeowners throughout Louisiana, like you,
whose homes were listed but did not sell. We asked them two critical questions:
“What did your agent do that you liked best?”
“What do you think they should have done?”
We then compiled their responses into this special research report. Often,
they identified multiple challenges that prevented the successful sale of their
home. The 13 most common reasons identified by homeowners in
Louisiana are detailed below – not our opinion. We recommend you
take advantage of this feedback as a way to avoid these pitfalls.
1. A Passive Approach to Marketing the Home
So many agents get into the business in order to make a lot of
money, be their own boss and make their own schedule – no wonder so few get anything done!
This is the most common reason a home does not sell. Why is it that so many agents focus on getting a listing and placing it on the MLS? This is the most passive form of marketing possible. After all, why would “greedy agents” be so quick to give away half the commission? Maybe they’re more focused on “getting the listing” than “getting it SOLD!”
2. Poor Pictures or Lack of Pictures on the MLS and Internet
If you can’t have a vision for the product, you can’t sell it. Statistics show that a home with no pictures takes about twice as long to sell as one that has pictures. 80% of potential buyers now begin the searching via the Internet. Easy browsing via the Internet depends on nice photos. Poor pictures create an instant negative impression for the potential buyer (as well as any agent that is deciding which homes to show!). Have you seen some ridiculous pictures of homes?
3. Low Compensation to Buyer’s Agents
We would all like to save money by selling a home for the highest price and netting the most money possible. Low compensation to the “Buyer’s Brokerage” (also known as CBB or Cooperation to Buyer Brokerage) is not the place to save money. Here’s why: Louisiana has nearly 20,000 agents. A typical month has 5,000 home sales which yield 10,000 “paychecks” (one paycheck for the buyer’s agent and the listing agent in each transaction). We also know that the top 10% of the agents close 90% of the transactions. That means the “typical agents” (about 18,000 of them!) are sharing about 1,000 paychecks each month. As a result, most aren’t paid at all. The National Association of Realtors estimates that the “typical agent” closes four (4) transactions per year. If so, the commission percentage paid on each individual home matters a great deal. Do you want agents to show your home first, last, or not at all?
4. Paying the Listing Agent Less Than the Buyer’s Agent
A homeowner represented by a listing agent that is willing to work for lower compensation than that being paid to the buyer’s agent faces several key challenges – ultimately it can lead to a failed listing. Some listing agents may become “protective” of the listing in an attempt to “double end” (find the buyer directly without help from an outside agent). In doing so, the become “Dual Agents” – representing both buyer and seller – and therefore collect the entire commission.
Protecting the listing prevents cooperation, and reduces interest.
Recently, an informal study was conducted of listing agents in Louisiana. A professional phone call was placed to listing agents representing homes that had been on the market over 90 days. The phone call was designed to secure the listing agent’s permission to advertise the availability of the home in a printed magazine at no cost to the agent or homeowner (FREE!). Approximately 50% of agents did not even answer their phone (see problem #1). Strangely, over 40% of listing agents DECLINED this opportunity to re-energize interest in a property that had been waiting over 90 days for a motivated and qualified buyer. Why are agents protecting their listing?
5. Reputation Of The Listing Agent Or Company
An unfortunate reality of the real estate business is the low standard to which real estate professionals are held. Most people are not aware that the exam required by the State of Louisiana to become an Agent has not been changed substantially in 20 years. Even more amazing is that the exam HAS NO BEARING on the everyday practice of assisting a client in buying or selling a home. Furthermore, a large number of real estate professionals are not REALTORS . The only requirement to become a REALTOR is to have an agent’s license, pay the membership dues, and promise to follow “The Code of Ethics”. Can you afford to hire an agent that won’t agree to follow a Code of Ethics? Further some home sellers are disappointed because they have selected an Agent or Company whose reputation is so poor, that fellow agents don’t want to work with them. Have you checked the Better Business Bureau?
6. Refusing To Make Cosmetic Changes
New homes have a new paint, carpet, a fresh smell, and are spic-and-span clean. A home that is too full of furniture gives a “small” impression. A home that is totally vacant can give the same impression – there’s nothing in the rooms to assist
RESEARCH RESULTS FROM LOUISIANA HOUSE HUNTING
7. No Lockbox
“That house needs an appointment because there are dogs on the property.”
“We have to make an appointment – let’s see if these other ones are good.”
“That house can’t be shown easily – I wonder if the seller needs to sell.”
“Sorry, that house is not available.”
“I couldn’t reach their agent to get into the house.”
These are among the many things lazy agents have been known to say (truth or lie!) in order to avoid showing a home that is not on the lockbox. Without a lockbox and easy access, a home can lose interest quickly or worse – it can be ignored entirely.
Accessibility is a major key to profitability. The more accessible your home…the better your odds.
8. Relying Solely on Traditional Methods
Innovative agents who offer new strategies to attract home buyer will always outperform agents who rely on traditional methods.Traditional methods are just the beginning steps of a marketing plan. These methods include an open house, sending postcards to neighbors, and placing the home in the newspaper. Adding certain “Active” approaches however is extremely valuable. Some examples: contacting top agents in the area to make them aware of the property. Knocking on neighbor’s doors. Online advertising of the property. Using an 800 telephone number with lead capture and accountability to secure potential leads.
9. Refusing To Make Profit Inducing Repairs
It almost always costs more money to sell “as is” that to make repairs that increase the value of your home. Even minor improvements will yield as much as three to five times the repair cost at the time of sale. Your agent will be able to point out what repairs will significantly increase the value of your home. Seemingly small fix up jobs can have quite an impact.
10. Failure of Agent/Client Communication
Sometimes the main challenge lies within the client and the agent’s ability to communicate well with one another. Communication breakdowns, anger, lack of responsiveness, lack of trust often prevent productive decisions from being made. Since we are now seeing a “normal” time frame to sell a home, establishing a regular, open and consistent feedback loop is critical to success. We recommend you select an agent with a well established feedback system. What do we mean? Just ask!
11. Poor “Curb Appeal” and First Impression
The prospective home buyer’s first impression is the most important. An unbelievable amount of home sales have been lost to unkempt lawns, cluttered rooms, bad stains, unpleasant odors…all the seemingly little things. Imagine you were the home buyer and clean you place from top to bottom, military style! Buyers will think you always keep it spic-and-span!
12. Wasting Time With An Unqualified Prospect
It’s your agent’s responsibility to screen a prospect’s qualification before valuable time is lost. Be sure to align yourself with the right professional. Don’t work with an agent that will negotiate with unqualified prospects.How carefully did the agent qualify the appointment with you before coming over to see you? Are they efficient or desperate?
13. Believing All Realtors Are The Same
With all the intricate details and critical decisions to be made concerning your home sale, should you rely on anyone but a “hand-on” oriented top producing professional? Home sellers who were unsuccessful selling their homes often complain that their agent did little after “taking the listing”. Your home sale is a time-consuming, effort-related, difficult task. Therefore, it is critical to select an agent that is an active and involved professional who will maximize your profit.
I hope you found the ideas valuable and if there is ever any way we can be of service to you or anyone you care about, please contact us. It costs nothing to discuss with us the criteria you should be using to hire the best agent possible.
Maximizing your sales price and having a smooth transaction is simple:
Begin by giving us a call now at (318)553-5039!