A colleague invited me to his Broker’s Open House recently. You know the drill. A number of Realtors who have no real interest or prospect for a given property show up to partake in bad chain restaurant pasta and stale bread sticks. On rare occasions we rejoice over a cookie for dessert.
This particular colleague is a sharp agent. He’s been around for several decades and made a pretty good living over that time. He has a reputation for integrity and a high level of ethics and is widely respected by his peers. Yet 12 and ½ seconds after walking into his listing all I could wonder is why.
This home was riddled with pink Frieze carpet, pickled oak kitchen cabinets with white appliances and had a basement that in that over its 2196 square feet had not one inch of floor coverings. It had drywall, paint, a finished bath, great daylight windows, wiring for a theater, brand new polished pewter light fixtures but no floor covering. Just poured concrete. In other words this home had some warts and I’ve not included all of them here.
In addition to being supportive of my colleague, my interest in going had its selfish side. I had a listing the next street over from agent Ron and I was curious to see how it stacked up against mine. In the interest of fairness, my listing had warts too. An entire case of Compound W wasn’t curing what ailed what my sellers had done to their home from the personal décor to the lack of certain fundamental amenities for the price point. Yet there was a difference. Agent Ron had agreed to take his shiny new listing at 150% of what mine was on the market for.
Like a man who was completely unaware…
My listing had been up for over 16 months and had price reductions of nearly 38% of the original listing value and still was not sold. Both properties were within 200 square feet of each other and had similar lots. Both were in price points with limited activity and nearly 8 years worth of supply. Yet despite all of those issues, Agent Ron cheerfully greeted each of us at the door like a man who was completely unaware of what was in front of him.
He, like many of us, was about to walk into the land of wasted marketing dollars and lost Sunday afternoons staring at bad family pics of other people’s trips to Boca while countless neighbors trudged past us and our neatly printed color flyers. Yes agent Ron, this was about to become your life.
And here’s the point…
Here’s the point of all of this: In the current market environment there is so much more clarity than there used to be. We’re not in a world of rapidly increasing valuations that sometimes warrant Realtors taking listings they weren’t sure about. Most all of us live in a world where a major percentage of the available inventory have values that are pretty clearly defined.
In addition, we also have the coveted HVCC that’s also begun to dictate where we can even close properties at in terms of value. We as an industry have the ability to look into the crystal ball in a more precise way than ever. So why is it so many agents are still taking listings that have no reasonable chance anywhere near their current list price? It can’t be desperation….not selling a listing doesn’t help anyone’s finances. It can’t be lack of knowledge because the data is more clear than ever.
So why? While there may be a myriad of reasons, there are no acceptable excuses. The reality is that propping up homes that have no realistic chance of selling at a given price is a terrible impediment to a true recovery. By doing this we slow the process of ‘finding the bottom.’ As a very wise old Realtor once told me….’I can stay home and go broke.’ True that. In the world we live in, many of us need to be more forceful in telling sellers there is no glory in wasted time, dollars and days on the market. It’s also something we need to be reminding ourselves of every day.