There are only two good reasons to sell your home in 2009:
- You MUST, and
- You want to “buy up” in value because prices are low.
This article address the MUST seller more than the value-buying seller.
MUST sellers include sellers who have job transfers out-of-town, marriages (where both people own homes), divorces, deaths, job/income losses, and increasing family size.
Have you ever heard of the 80/20 Rule? 80% of the business in any given industry is done by 20% of the people working in that industry.
According to the National Association of Realtors, that ratio is even more exaggerated in the real estate industry. In fact, it is estimated that 5% percent of Realtors account for 95% of the business. That is a staggering statistic!
If it is true, then 95% of the agents out there are fighting over the 5% of the business that is left over.
The first time I heard this statistic, I thought it was preposterous. So I obtained the list of Realtors from my local MLS (3,500 of them) and started at the top, highest volume descending to lowest volume. According to this theory, 175 agents on our MLS accounted for 95% of the business.
As started down the list and, sure enough, I got to about #125 and I didn’t recognize the name. Mind you, I’ve been in this market for more than 20 years and thought I knew most of the local Realtors. But by the time I hit #150, I recognized fewer and fewer. At #175, the names listed were those of agents who I know do relatively little business.
Regardless of my review being less than scientific, it was pretty clear that the top 5% of Realtors are doing considerably more business than the other 95%
So, what are the other 3,325 Realtors doing? In their battle for the 5% or 10% of the scraps of business that are left, they sometimes might tell a Seller what they want to hear in order to get a listing.
And that could cost you, the Seller, a lot of real money.
Case in point: A year ago, a couple called me to list their home. When they asked what it would sell for, I told them $185,000. It was disappointing to them so they got a second opinion. The other agent told them $240,000, and called them every month for the next ten months to lower the price. Eventually, he got the price down to $189,900 and it sold … for precisely what I had told them it would ten months earlier — $185,000.
No harm, no foul, right? What did it matter that the agent eventually got to the right price? Did I mention the Seller had moved out of town??
During those ten months it was on the market, the Seller paid more than $12,000 in house payments, nearly $3,000 in property taxes, and more than $2,000 in lawn maintenance, snow plowing, heat, electric and water, and had to pay $3,000 for a new furnace that quit five months into the listing.
In all, the Sellers paid about $20,000 more than if they had listed it at the true price initially. If they had gotten it sold in 30 or 60, or even 90 days, they would have saved tens of thousands of dollars.
Before you choose a real estate agent, choose one you can trust. Be wary of those who sound too good to be true.
