Personalized buyer letters: deliver to home sellers or toss them out?

Inventory is scarce. Multiple-offer situations are commonplace. Homebuyers are looking for a way to stand out against their competition.

Most recent advice from the real estate industry to homebuyers pushes personalization. Buyers are told to deliver a nice letter to the seller along with their offer including who they are, how much they love the home, and why they’re the best candidate for a home in this neighborhood. This is all well and good for a buyer whose sole intention is securing the home.

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From a listing agent’s perspective, however, the propriety is not so clear. Let’s start at the most basic principle of representing a seller. The listing agent’s primary duty is to act in the seller’s interests, and that means securing the highest financial return while selecting the buyer most likely to complete the transaction and fulfill the seller’s goals.

How does delivering a personalized letter from a buyer to a seller align with those goals?

A buyer’s letter is a piece of marketing, written by another agent’s client (or sometimes by the buyer’s agent). It is an attempt to entice the seller into accepting an offer based on factors that probably have nothing to do with the seller’s needs. The letter is an emotional pull, a tactic to make the seller forget about their bank account for a moment, and make a potentially irrational decision based on a “feeling” about someone they’ve never met.

The listing agent’s job, as an experienced professional, is to clear unnecessary static out of the home sellers’ decision-making process. By delivering these marketing pieces to their sellers, aren’t listing agents creating an undue burden of anxiety and guilt as they overpersonalize the financial decision being made?

When was the last time that you gave $5 at the grocery store cash register to a charitable cause? It was only when the cause was brought up by the store employee and, at that moment, it seemed like a nice thing to do. Either that, or you felt a little bit guilty saying “no.” Nobody just offers up an extra $5 at checkout and asks, “Any good causes you could put this toward?”

It’s the same with the overpersonalization of the home-selling process. A buyer’s letter might make them more attractive because they went to the same university as the seller, it is their first home purchase, or they have a cute baby. Unless the sellers have specifically asked the listing agent to find them a first-time homebuyer, however, this is information the sellers should have not been forced to consider. Selling a home is not a charity act, unless the sellers have specifically asked for it to be so.

The moment a home seller is weighing these new personalized factors, the listing agent has led them astray. While the initial goal of financial return was clear, the confusion of the buyers’ letters multiplies the guilt of the grocery store cashier’s donation request into a potential six-figure decision.

This isn’t to say that a homebuyer’s situation isn’t important. There are all kinds of factors pertaining to a buyer that can influence whether or not they are the best candidate for the home: employment; financial strength; commitment to this particular home; etc.

However, these items can be personally translated by the listing agent to the seller in a clear and concise fashion. Any relevant information that the buyer, or the buyer’s agent, delivers to the listing agent can be broken down and explained to the seller, with the marketing and extraneous information removed. Listing agents have a duty to present all offers to their home sellers — but not all of the attached marketing materials.

To take it a step further, a listing agent might be opening up potential legal issues by delivering certain letters to their clients. A letter may inadvertently suggest a superior candidate for this home or location in a way that seems to identify the buyer as a specific race, religion, gender, familial status, etc. While the buyer may have no liability in this case, by delivering the letter to a seller, the listing agent has now become a party to the dissemination of that material. It can open up the potential for steering or other fair housing violations. At the very least, it is a distraction from the contractual terms that are actually being negotiated, which diminishes the value of the agent’s representation.

To put it simply, the duty of a listing agent is to the sellers’ pocketbooks, and their mental well-being. Listing agents should focus on removing unnecessary emotional hurdles in the process of selling a home. Buyers are welcome to submit personalized letters with their offers (and probably should, as many listing agents won’t heed this advice). In the meantime, a good listing agent should read those buyer letters, and relate only the relevant and appropriate portions to the sellers. This streamlines the home-selling process, allows for clear-headed decision making, and focuses on the home sellers’ ultimate goal of financial return.