I hate it when other real estate agents make us look bad.
When it comes to public trust and confidence, real estate agents rank somewhere toward the bottom, alongside used car salesmen and U.S. Congresspersons. Which is unfortunate, because I have met so many really good, hardworking, ethical men and women in this business.
But then there are the agents who give all of us a bad name.
In this continuing seller’s market, the hot topic du jour in real estate ethics has been the issue of “coming soon” marketing. Which can be either a really good thing that helps a seller get more money for a listing, or a really bad thing that puts the agent’s interests above the seller’s.
Here’s the basic premise: Especially in a seller’s market, wide exposure to the general public is the key to obtaining the maximum price for a home. Simply, you want everybody who may have interest in the home to know it’s for sale, and to have the opportunity to see it and to make an offer. The more offers, the better position the sellers are in to choose the one that best suits their needs.
Good “coming soon” marketing facilitates that. Through sign riders, web sites and other marketing methods, agents can build awareness of and enthusiasm for their listings, so that when they hit the MLS, there will already be lots of buyers lined up. That’s good. It helps maximize exposure to the general public, and the odds of receiving multiple offers.
Some agents, however, are using “coming soon” marketing for their own purposes. They realize that if a buyer has no agent, the listing agent can represent the buyer as well, “double-ending” the transaction and doubling his or her profit. So they use “coming soon” marketing to reach out to agent-less buyers, hoping to sell to one of them in a double-ended transaction before the listing ever appears on the MLS.
That may be good for the agent, but it sure isn’t good for the seller. It can cost him or her thousands – or even tens of thousands – of dollars in unrealized profits.
Offices are apparently doing this to give their own agents an advantage as well. An agent (for a company that shall remain nameless) recently told one of my buyers that 40% of the listings in her office sell before they ever hit the MLS. Why? Because they hold “coming soon” meetings where all of the agents talk about their upcoming listings, and give each other “first shot” at them before they are listed on the MLS.
If that is true, this is an office full of agents who are robbing their sellers of a whole lot of money.
What does good “coming soon” marketing look like? Simple. First, showings aren’t allowed until it has “arrived” on the MLS. Everybody gets to see the property at the same time. Second and more important, offers aren’t considered until the listing has been on the MLS long enough to give the general public time to see the property and to prepare an offer. I once arrived at a listing lat 9 am on the first day it was open to show, and immediately received a message telling me it had gone under contract. That property was never really available to the general public.
There are, of course, times when it makes sense to sell a house before it’s listed on the MLS. A good offer received before listing could be a godsend in a buyer’s market, where properties could sit unsold for six months or more. Sometimes a seller knows he could get more, but has his own reasons for selling to a certain person at a certain price.
What doesn’t make sense is to limit a property’s exposure to the general public in order to facilitate “insider sales” that benefit real estate agents at the expense of sellers.
If you’re flirting with the thought of selling in this seller’s market, or of buying now while interest rates are low, call me. I have made adjustments to my marketing strategies – and to my offer strategies for buyers – to work better in this prolonged seller’s market. And, more important yet, I promise to look out for what is best for you, throughout the transaction and beyond.