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Ethics

Giving Sellers a To Do List

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Giving Sellers a To Do List


Delivering the Bad News

Isn’t it more enjoyable when you get to deliver the good news? “Full price offer for your home with no contingencies!” Those conversations are the best and usually the easiest ones to have.

Many times when you are hired to do the job of marketing and selling a home, you have some bad news that must be delivered. I’m talking about the bad news when you wish you could just state the obvious, “Your home is a pig sty. Clean it up.”

Ain’t no Replacin’ Honesty

Honesty is always the best policy. When hired as a Seller’s Real Estate Agent, you are hired to be a professional lacking nothing when it comes to honesty. It will not be in anyone’s best interest to have a house that sits on the market because an agent wasn’t willing to advise the sellers of what needs to be done before the house hits the market.

Prepare for the Worst

Depending on the client, sometimes it helps to set them up first, “I’m getting ready to deliver some news that will be hard to hear. I realize this is your home, but I’m here to tell you what needs to be done to not only be a house for sale – but get it sold.” Most recently, I joked around and used Twitter, “At seller’s house for my inspection before listing….he says ‘Don’t be rough’ Think I should be?” (Then I text messaged my seller to read it). He responded @KimWood do your worst! I’m sure he can take it. (It was my way of setting him up.)

The List Delivered

When you go over each item, don’t fluff anything – be honest and straightforward based on facts.

  • The front door needs a face-lift, why don’t you throw on a coat of paint and get new hardware.
  • It is difficult to look at the house with all of the ‘stuff’. You might consider getting a storage unit and filling it. Keep what you need for a temporary vacation home.
  • I love to see your family pictures and the memories you’ve made here. If you want to leave one or two, that is fine, otherwise, they all need to be put away.
  • You may want to hire a professional carpet cleaner, if they can not get all of the high traffic stains out – I’d recommend replacing it.
  • There is a basement odor, I know you keep the litterboxes down there. Strong scents whether good or bad are a major ‘turn off’ for buyers. It needs to be neutralized.
  • I’m sure you probably haven’t noticed it anymore, but all of the doors having holes from being kicked in speaks to a buyer, “needs work”, it’s worth it to replace them.

Keep it Respectful

Whatever issues need to be addressed in order to sell the home under the provisions the seller desires (time, money, condition) it is the real estate agent’s responsibility to communicate the issues honestly whether it is hard or not. Just tell it how it is with respect and professionalism.

image courtesy of flickr

Kim resides and works selling Real Estate in Chester County, PA. She is a blogger and also writes for her own blog, West of Philly Burbs and Mothers Fighting for Others. Kim is a Social Networking Junkie and you can connect with her in many places including Twitter, Facebook, or Flickr.

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13 Comments

13 Comments

  1. Steve Beam

    November 5, 2008 at 6:11 pm

    Honesty is the best policy. I’ve lost only a few clients over the years for being honest about the work their homes needed. Sellers that don’t want to make improvements are usually the ones that want top dollar too.

  2. Vicki Moore

    November 5, 2008 at 6:30 pm

    Oh man. I’ve – as I’m sure others – have had tough conversations about cat boxes, smokers and dirty toilets. It’s a tough job sometimes. I like to get the bad news delivered immediately – before my stomach turns into knots and I have to spend the afternoon in the bathroom – oh well, probably TMI there. LOL.

  3. Lisa Sanderson

    November 5, 2008 at 6:54 pm

    I’m interested to hear how & when people deliver this news. Do you actually type out a checklist and go over with them in person? Email it to them? Hand-write notes on your tablet as you go through the house and then tear off the sheet and say ‘have fun!’ ? Is it part of the cma? I’ve done all of these things at one time or another and wonder what people find to be most effective.

  4. Missy Caulk

    November 5, 2008 at 9:32 pm

    Kim, most people ask, what can we do or when I am walking through with them they will say “we’re getting rid of this” or something.

    If a house needs to be staged to sell then I tell them, and I have no problem with it.

  5. Vicki Moore

    November 5, 2008 at 9:42 pm

    I go through the house talking to them, explaining why and how much better it will look, then prepare a list. I ask if they want to take care of the list or would they rather I make arrangements to have it done. Then I check in with them to see how the list is going to make sure we’re following the time line.

    I try to be diplomatic but if they don’t get the soft approach, I have told people: Look, it stinks in here. Sometimes it’s the only way they’ll hear it.

  6. Jill Wente

    November 6, 2008 at 12:43 pm

    Kim: I get my sellers ready by telling them that right now you are living in your home but as soon as we put your home on the market it becomes a product. And as a product, it needs to look and smell its best so that buyers choose your product over the other products. It usually works and takes some of the “oh, she does not like my stuff or she thinks my house is a wreck”

    When we get feedback from other agents saying that their house looks like a model home they love it.

  7. Steve Simon

    November 7, 2008 at 6:01 am

    This is the toughest area of the entire process. Having been a seller a number of times and a licensee for over 20 years I know the dialogue well. I think the lists needs to include only the items of highest priority. To include “Staging” in with a list of musts for sellers is in my opinion not appropriate. Staging should be saved for the most cooperative sellers that have already complied with the high priority items. Just my thoughts:)

  8. Daytona Beach Real Estate

    November 7, 2008 at 2:27 pm

    It is sometimes difficult to communicate with the seller. But, I have found, that by putting a lot of extra effort into making the house presentable, marketing the house and explaining the process to the owner, they usually jump on board and begin to understand how important every aspect of the house really is.

  9. Kay Baker Wilmington NC Real Estate

    November 7, 2008 at 2:30 pm

    Kim, I could not agree with you more. There is no substitute for being honest in this business.

  10. Derec Shuler

    November 11, 2008 at 11:37 pm

    Our company has a design consultant come through all the listings and give them a report. It saves us the trouble of being the bad guy since it’s from an “objective” third party.

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Ethics

The problem with a self-policing industry: you have to be a narc

Ethics violations in the real estate industry can make or break a Realtor’s career, depending on the severity, so it would stand to reason that all would be mindful of the rules, but there are always individuals in the field that act as if the Code of Ethics is irrelevant.

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An animated discussion on ethics training

“Does anyone else find it ironic that NAR – the trade association for Realtors – has to mandate that members take an ethics class every four years?” An agent who attended one of my company’s broker opens yesterday posed that question to the wine and cheese grazing attendees. Of course, that opened up an animated discussion on the value of etchics training and the lack of enforcement when the rules are violated.

One agent volunteered that the guy sitting next to her in her last ethics class played games on his cell phone and then cheated during the test at the end of the class. Seriously, dude? You cannot even pay attention long enough to pass what should be the easiest test you’ll ever have to take in your career? Perhaps he was just seeing how far he could push it by cheating during an ethics test, to see if anyone else around him caught the extreme irony there. None of the other agents around him – including the agent he cheated off – turned him in and the instructor didn’t notice.

This same agent later called one of my sellers and tried to convince him to break a listing contract with me, because he had a “guaranteed buyer” in the wings. The seller was an attorney, and this bozo tried to get me cut out of the deal, offering the seller a reduced fee to dump me. The seller held firm and directed the agent to call me, then the seller called to let me know about the conversation.

“But you know if you file something the other agent will know.”

It gets better. After the deal closed, I requested paperwork from our local Board of Realtors to file an ethics complaint. The person in charge said, “But you know if you file something the other agent will know.” Gee. Really? I asked her to send the paperwork over anyway.

I called the seller/attorney and asked him to repeat the conversation to me, because I was documenting it to file a complaint. He turned wishy washy on me at that point and his story changed from “The other agent tried to get me to dump you as the listing agent to cut you out” to “Well he really only asked a few questions and I told him to call you. He probably didn’t mean any harm by it.” So there goes my star witness, who doesn’t want to rock the boat.

I didn’t file the complaint. I resorted to the “turn the blind eye but never trust the sleazeball again” path. And that is what happens to almost all ethics issues I hear about / see in person.

That’s what happens when you have a self-policing group of “professionals” who would rather not “narc” on a fellow agent. After all you’re probably going to end up on the other side of a deal from this guy some day, right? The guy in my example has sold two of my houses since that run-in. Why tick him off by filing a complaint and going through all that hassle? If he stops bringing buyers to my properties then my sellers ultimately lose, right?

Boiling down the CoE

The NAR Code of Ethics takes up pages and pages of tiny print, and it runs each year in their trade magazine (I think it’s the January issue). Does anybody read that? Probably not many. I’d argue none of us ever should have to read it again. Simply follow this advice instead. The thousands of words in the Code boil down to one thing: Do unto other agents, and consumers, and clients, what you would have them do unto you. It’s the Golden Rule. Simple. Well, obviously not, for many agents and brokers.

The sad part is the agent in my example had no clue how close I was to filing that compaint, and if he did know he’d probably scratch his head and wonder why his actions were “wrong.” Making us take a one-day class every few years won’t “make” the unethical agents suddenly operate ethically. Most of them just don’t get it.

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Ethics

Ethics hearings in private a disservice to consumers?

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Fight Club and real estate

For those of you that saw the movie ‘Fight Club’ you’ll remember that Rule #1 is “You do not talk about fight club,” followed closely by Rule #2, “You DO NOT talk about fight club.” Which, believe it or not, brings me to today’s topic: The Real Estate Code of Ethics and Arbitration. Article 17 obligates Realtors to resolve fights disputes with another Realtor through arbitration (not litigation). Arbitration is conducted at the local board level, and I am not aware of a local board that doesn’t require arbitration to be confidential.

I respect that public internecine warfare amongst Realtors isn’t in the interest of our industry, and doesn’t belong in the public spotlight. I’m not here to advocate the collective airing of our dirty laundry. That said, I wonder if our collective agreement to keep our concerns confidential can inadvertently harm the consumer and ultimately makes all of us look a little shoddier?

To find the first arbitration guidelines created by NAR and distributed as a set of suggested rules for boards to follow, we have to travel all the way back in time to 1929. NAR’s first Code of Ethics & Arbitration Manual wasn’t created until 1973, and it credited a 1965 California Association of Realtors version as its model.

Appalling conduct

I can think of two instances in the past year where I was so appalled by the conduct of a fellow Realtor that I went to the trouble to inquire about how to lodge a Code of Ethics complaint with my local board. After weighing the time required to make a competent complaint and comparing it with the best case outcome (a closed-to-the-public hearing in which they were found to have violated the code of ethics), I decided not to pursue a complaint in both cases. My association’s bylaws (and probably yours) give it the power to discipline any member based on the results of a Code of Ethics hearing, “provided that the discipline imposed is consistent with the discipline authorized by the Professional Standards Committee of the National Association of REALTORS® as set forth in the Code of Ethics and Arbitration Manual of the National Association.”

“Sanctioning Guidelines” – (Appendix VII of Part 4 of the 2011 manual for the very curious), guides member boards to impose disciplinary consequences that are progressive and fair, taking all considerations into account. Sample first-time disciplinary actions include suggestions of a letter of warning, a fine (amounts range from $200 to $5,000 depending on the severity of the violation), and attendance at relevant education sessions. Not to sound defeatist, but a confidential letter of warning and a fine of around $200 doesn’t seem like an outcome worth investing much of my time in.

Practicing in the internet era

Given that we live and work in the internet era, and review sites like Yelp abound, it seems a bit odd to me that a local board might know of an agent with problem behavior that is documented yet choose to make that information unavailable to consumers. My understanding is that the results of a code of ethics hearing are confidential with disclosure authorized in a few situations, none of which deal with informing the public.

Many of my fellow colleagues feel that the best response to a bad agent is to be patient and give them enough time to work themselves out of business. I can respect and understand their hands-off approach. But what about the damage that individual does to our industry as a whole? While we whisper, warn in confidence and know amongst ourselves how awful they are, the public doesn’t get the benefit of our perspective. Deprived of it, they turn to consumer review sites like Yelp.

How do you think we, as an industry, can help consumers in their quest to find a trustworthy agent?

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Ethics

Realtors, we really need to get over ourselves already

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A letter from the child of a Realtor.

Real estate now vs. 1987

In Real Estate, some things are always changing, like financing, education, laws, rules and technology. The two that will always remain constant, as long as they are within the law, are following our clients’ directions, and working with their best interests in mind.  I’m not sure we always follow through with this, though.

Some of us knowingly take over priced listings.  Some of us take listings that are out of our area of expertise.  Some of us won’t show short sales or REOs.  Some of us won’t show homes with low co-op splits.  Some of us don’t have Supra/e-Keys, and miss out on those listings entirely.

Putting our interests first

When these things occur we are putting our own interests first, not our clients’.  We may think that by having as many listings as possible is a good thing, that’s what we’re taught after all, isn’t it?  It may not matter that some are overpriced, eventually, whether one month or four months down the line, the price will be reduced.  It’s just a matter of time and money, for our clients, after all.  The same can be said when we take listings outside our area of expertise, just to add on to our inventory.  If we don’t know what we’re doing, on a short sale listing, for example, it will only cost our clients a lot of time and money.  A lot.

By eliminating certain houses our clients see, that may already fit their criteria, we’re taking away their choices.  Distressed sales account for close to 40% of the market.  This is probably higher in some local markets.  There is no legitimate way to ignore roughly 1/3 of the homes being sold.  Co-op fees are often a touchy subject, especially when they are, not “enough.”  If everyone utilized a Buyer Broker Agreement that stipulated what their fee was, the issue would take care of itself.  Not being able to access listings with the use of Supra/e-Keys is a choice.   Choosing not purchase one will mean agents will not be able to access Fannie Mae (and eventually, probably additional Gov REO homes) along with the listings that are already using them.

Our priorities versus theirs

We totally need to get over ourselves already.  We are not bigger than our clients.  Our priorities are not more important than theirs when it comes to the actual listing and selling of homes.

Recently, my awesome parents dug through a few boxes and rounded up one of my first art projects. About 25 years ago I did the poster featured above about my Mom, and her Real Estate career.  It was for an Open House (no pun, honest!!!) for the elementary school where I attended first grade.  It was just, what she did according to me way back then.  Things are way more complicated now, than when I was six.  There’s a heck of a lot more paperwork for one.  But the same basic principle still applies.

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