The Problem With Easy Out Listing Agreements!

By
Real Estate Agent with United Realty Group SL0475285

For years I've offered my listing clients an "easy out" listing agreement. I suggest that if they are unhappy with me or my service, they can cancel their listing agreement at any time without cost or cause.  It helped me get many more listings as it takes the fear out of being stuck with a lousy agent.  Rarely did anyone avail themselves of this clause.

Now, in this market of limited buyers and slow sales, sellers are getting frequently impatient at no traffic and no sale.  As agressive as you can be asking for price reductions, there just aren't enough buyers to go around.  As I wrote in a prior blog, most South Florida markets (Pembroke Pines, Miramar, Weston, Aventura, Miami Beach) have inventory that would take a year to absorb, assuming no new additions are made to the market.

With that being said, I am now considering dropping the "easy out" clause or modifying it to provide that they can cancel if they reimburse me for all out of pocket expenses up until the date of cancellation.  We'll see! 

 

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Rainer
42,239
Jonathan Greene
Team Greene Realty - Tampa, FL
Good call.  I offer them the option to cancel if I don't correct any problems within 10 calendar days (provide the problem is within my sphere of control).
Aug 25, 2006 06:14 AM #1
Rainmaker
471,523
Geri Sonkin
Douglas Elliman Real Estate 516-457-7103 - Merrick, NY
Long Island Real Estate & Staging Expert

David,

I too used to do the easy exit but cannot risk in in this market.  As you said with the numbers of homes increasing every week and homes sitting on the market much longer, it's easy for homeowners to get restless.  Whose fault is is if the house doesn't sell . . . ours, of course.

I also refuse to take listings for less than six months since there's a really good chance it will take that or longer to sell.

Aug 25, 2006 06:33 AM #2
Rainer
36,693
Sara Lipnitz
Max Broock Realtors - Birmingham, MI
I have always offered the same clause.  I think that its tricky in today's market.  If you drop it... so will I.  Let's keep in touch on this point and see how we do!  Thanks for the post.
Aug 25, 2006 08:34 AM #3
Rainmaker
599,330
Mitchell J Hall
Compass - Manhattan, NY
Lic Associate RE Broker - Manhattan & Brooklyn

Coldwell Banker has a seller's guarantee - it's an out but not an easy out. It says they can fire us if we don't do the following things and there is a whole list.

Six months is now the average in my market so I think the listing contract should be 8 months to a year. Even in a hot market 6 months is the minimum I would ever take.

Aug 25, 2006 12:01 PM #4
Rainer
128,355
David Eiglarsh
United Realty Group - Weston, FL
CRS, CDPE, Serving South Florida
I was at Coldwell for 6 years, my mother for 23 years. I remember the Satisfaction Guarantee. We used it. Mine is more broad & less restrictive. It worked for the past 5 years when we could sell a house before the yard sign was installed! Those days are gone!
Aug 25, 2006 12:40 PM #5
Rainmaker
136,152
Sherri Berry
Reliant Realty, Murfreesboro - Murfreesboro, TN
Murfreesboro TN Homes & Real Estate
I use the easy out clause and so far have never had anyone use it.  I've always felt if a client was unhappy with me, and I have done my job and communicated effectively, then I really don't want their business anyway.  How miserable would it be to force somebody to stay locked in a contract that really wanted out.  I don't know if I would change my position if our market dramatically changed and became very slow.  I still think I would lean toward usingthe clause. 
Aug 25, 2006 12:49 PM #6
Rainer
70,128
Pam Hofmann
Third Tennessee Realty & Associates, LLC - Crossville, TN
Your Crossville, Lake Tansi & Fairfield Glade Specialist
We tend to offer it on most listings but not all. I agree with the current market we might rethink our position
Aug 25, 2006 03:10 PM #7
Rainer
133,865
Peter Andres - Lic. in FL & NY GRI,SRES,CNE
REALTOR - The Villages, FL

I think a modified version should be constructed incorporating some of CB's techniques.

Would all of you fellow professionals share your ideas on this blog to come up with a working agreement we can use. I'm interested how CB has it worded.

Aug 25, 2006 04:14 PM #8
Rainer
133,865
Peter Andres - Lic. in FL & NY GRI,SRES,CNE
REALTOR - The Villages, FL

I spoke with CB friend today. Their guarantee addreses:

  • Marketing
  • Customer Service
  • Financing
  • Counseling Services
Aug 26, 2006 02:48 PM #9
Rainer
50
Illie Gren
RE/MAX Hometown - Weston, FL

David, you are amazing with all your blog entries and all your different sites, plus being one of our  TOP producers.  The knowledge and expertise that you so willingly share with the world makes me proud to have you on our team.  You write the best stuff.  Keep it up. 

 

Aug 28, 2006 07:36 AM #10
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Rainer
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David Eiglarsh

CRS, CDPE, Serving South Florida
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