Sellers Beware

By

Susan Stone

What’s wrong with this scene? 

“Hi, Mr. Smith!  I’m Realtor® A and I represent a lovely family that’s relocating to the area and wants to buy a home in your neighborhood.  I know your house would be perfect for them.  Would you consider selling it?”

“Perhaps, but I’d have to discuss it with my wife.”

“I wouldn’t charge you as much commission since I would represent both you and the Buyers, and you wouldn’t be inconvenienced with showings!”

“That does sound interesting. I’ll discuss it with my wife.  Please call me next week.”

An agent who encourages a Seller to sell his home to the agent’s Buyer without first suggesting the listing be put in the local Multiple Listing Service (MLS), is not properly representing the Seller.

The first thing agents are supposed to explain to clients is the concept of “AGENCY.”  Agency describes the duties of an agent when he represents the Seller only, the Buyer only, or both parties.  The agent has a fiduciary responsibility to his client(s), just as an attorney does.

 When negotiating any legal contract in business, each party has his own attorney or representative. If the same person were to represent both parties, there would be an obvious conflict of interest.  Sellers sometimes do not realize that selling their home is a complicated business transaction which requires a fiduciary that will put the Sellers’ needs first.

These are some of the reasons why pocket listings or single party listings are not beneficial to Sellers:

1.      The true market value of a product (including a home) is obtained only when the product is exposed to the entire market.  The Seller’s agent must reach every person possible who might be interested in buying the house before he can secure the best price and terms for the Seller.

2.      A Buyer is not going to offer his/her highest price and best terms if he/she knows that there are no other possible offers competing with it.

3.      This Buyer may not be the most qualified financially.

4.      What if the Buyer does not close escrow?  If the property has been listed in the MLS, the agent can probably pop another Buyer right into a new escrow, saving time and aggravation (and perhaps a lost deposit on a replacement purchase) for the Seller.

When selling your home, you should be sure that the listing agent has a plan to market the property to the entire market.  He/she should enter the listing in the MLS with accurate information (such as tract codes) as soon as the property is ready to be shown, make it easy for other agents to show and not give preferential treatment to his own buyers.