Every real estate agent takes overpriced listings. OK, maybe not every agent. (I’m sure that someone is already composing some pointedly outraged rebuttal for the comment section about how they’ve never taken an overpriced listing.)
So, fine, you’re the exception. You never take overpriced listings. Congratulations. You’re so strong!
But — why the outrage? Why is taking an overpriced listing so wrong, so verboten, so shameful?
Let’s stipulate: you should always counsel your client to price to the market, using every tool you have. That’s your fiduciary responsibility, to give the client good advice, even if he or she doesn’t want to hear it.
So I’m presuming that if you took an overpriced listing, it was only because after you did your best to educate that seller and explain the dangers of overshooting the market, she still instructed you to price the home above its likely value.
Let’s stipulate further: I’m not talking about an agent who overprices every listing. Don’t tell me some woeful story about how you always end up with unreasonable sellers.
More likely, you’re just not very good at your job of either analyzing or explaining the market; or you’ve gotten in the habit of “buying listings” on price. That’s not good.
I’m not defending you. Get better at your job, then come back and read the rest of the article.
But for the rest of you, who work hard to get your listings priced right but sometimes are forced with either taking the overpriced listing or walking away, go ahead and take the listing. It’s OK.
I know I’m not supposed to say that because I’m a “professional real estate trainer.” And we’re supposed to teach you how to stand up for yourself and never take an overpriced listing and never cut your commission and all that stuff that sounds really good when you’re standing on stage in front of a bunch of people that you’ll never actually see again. So strong! So powerful! So — impractical!
Here’s the reality: You’re going to take the listing. Why?
Maybe because you don’t want to see a competitor’s sign up in the neighborhood.
Maybe because you figure the seller will face reality after a month or two.
Maybe because you want the internet leads that come from having a listing on the market.
Maybe because you’re not 100 percent sure that you’re right, and you think the market might be moving quickly enough to justify what you now think is an unrealistic price.
Whatever the reason, most agents I know will take that listing. And I’m here to tell you it’s OK.
Honestly, I don’t get the “shaming” of real estate agents who take an overpriced listing. You go out on tour, and you’ll see agents tut-tutting every time they walk into a listing that’s outkicked the coverage.
Listen, we’ve all taken that particular walk of shame. None of us are innocent. So stop with the shaming.
I mean, why do we blame the agent? Again, assuming the agent did his or her job in analyzing and explaining the market, and he or she hasn’t developed a reputation for overpricing everything, then it’s almost certainly the seller who made the decision to price it too high.
And that’s not the agent’s fault.
Put it this way — I used to be an attorney, and like all attorneys, I occasionally had clients make terrible mistakes against my best counsel.
But I’ve never seen lawyers shame their colleagues for their clients’ bad decisions. If I advise a client to take a settlement offer, and she refuses, and then she loses her case and gets nothing, isn’t that on her?
Similarly, if an agent advises her client to price to the market, the client ignores her advice, and then the home sits unloved and unsold, how is that on the agent?
Ultimately, it’s the seller’s decision, and the agent has a fiduciary obligation to follow his or her client’s instructions, even if the agent disagrees with them.
Indeed, it’s only “shameful” if you allow your self-consciousness about taking an overpriced listing to affect the way you represent your seller.
We’ve all see agents at those broker opens who are uncomfortable with all the shade they’re getting, who try to defend themselves by saying something like “Yeah, I know it’s overpriced, but my seller insisted … ”
And that’s the danger of the “shaming.” You don’t compromise your ethics by taking an overpriced listing; you violate ethics by being so ashamed that it’s overpriced that you let other agents know it.
You can’t throw your seller under the caravan like that. You have to own that price, regardless of how you feel about it. You have to act like you’re practically giving the house away.
And if you still feel bad, just find a local meeting of your “Overpricer’s Anonymous” chapter. “I’m Joe, and I take overpriced listings.”
You’ll feel better, especially when you look around and see such a very, very full room, packed with just about every agent you know.
Read “Pricing mistake No. 1: Asking sellers what the home should go for,” “Pricing mistake No. 2: Telling rather than showing,” “Pricing mistake No. 3: Emphasizing unsold properties” and “Pricing mistake No. 5: The big price-drop fumble.”
Joseph Rand is one of the managing partners of Better Homes and Gardens Real Estate – Rand Realty in New York and New Jersey and blogs about his local markets at the Rand Country Blog and about the industry atClientOrientedRealEstate.com.