Please welcome Agent Genius’ newest writer, Renee Porsia who we have been working with for months to come aboard due to her wit, her ability to shake things up, and her chutzpah if you will. Renee is the Associate Broker at RE/MAX Action Realty and her being a gal from Philly explains why she isn’t scared to speak out, beginning with her article today about one of her biggest pet peeves about the industry. Please welcome her in comments!
Bait & Switch
Something that really bugs me about my profession is how so many Realtors over price listings just to get business. I call it the old bait and switch.
Now, I know that this will upset many Realtors- well, those that are guilty of over pricing their listings that is. To those Realtors I say, too bad! You are hurting and discrediting our profession every time you take another over priced listing and giving the rest of us, honest, hardworking, knowledgeable, ethical Realtors a bad name.
So, why would a Realtor take or even want to take an over priced listing? Simple, to get business. They figure any listing is better than no listing and that the home owner won’t want to go through the entire process of finding and hiring another Realtor, so they will just reduce the price in time and eventually the home will sell.
It’s not just the Realtor
Now, I am not only going to only pass blame solely on the Realtor because the homeowner bares responsibility as well because they do not have to hire the Realtor with the highest value for their home. Naturally, every home owner believes that their home is worth more than everyone else’s but it is the responsibility of the “professional” to advise and be truthful with the home owner and to walk away if the home owner has unrealistic expectations for their home. Home owners look to Realtors for guidance, professional advice and for facts. When a Realtor over prices a listing to simply get business, what they are telling the public is that Realtors are useless, that we are a dime a dozen and we simply do not know what we are doing. Isn’t that what most of the general public already thinks about Realtors anyway?
I feel that as a “professional” it is my job to be the “expert” and to make sure that my opinion and my knowledge be credible. I take my career very seriously.
Many will argue that it’s just too easy to obtain a real estate license and that is why there are so many “bad” Realtors and that very well may be, but for now the requirements are the requirements we are not all bad. I myself worked very hard to obtain my license and then my Broker’s license.
Why the bait and switch happens
I feel one of the problems facing the real estate industry is that people get into the business for all the wrong reasons whether it be to earn extra money, to flip properties, or to buy investment properties and those are not the reasons to become a Realtor. Being a Realtor is not easy and is not for everyone. I know that I became a Realtor so that I could help people with what might be probably the biggest financial decision of their life and to educate, and guide them. I’ve never purchased an investment property, never competed with my clients, never threw them under the bus for my own financial gain and never will. That’s not to say that one day I won’t purchase an investment property but when I finally do, it will be to secure my financial future and won’t have been the reason or the motivation for obtaining my real estate license.
If Realtors want the general public to view us as “experts” and actually put a “value” on what we do, you have to stop being desperate for business. You have to be strong and believe in yourself, your expertise, your license, have respect for our profession, our Code of Ethics and stop misleading home owners by over pricing their homes. Have the competence to walk away when a home owner is unrealistic and show the home owner that there is a need for a Realtor. Home owners know that if you won’t do what they want, there will be another one who will and that needs to stop.
Stop the bait and switch. What does the old real estate bait and switch look like in your market?
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“have respect for our profession, our Code of Ethics”
Start with representing our trademark correctly REALTOR®
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I typically just say Realtor- it’s not a sign of disrespect, it’s a matter of my hating that the trademark is in all frickin’ caps like it’s supposed to be SCREAMED AT EVERYONE!!!! lol
Lani, I understand your thoughts, but we all agree to use the Trademark in its proper format. The more that it is not used, the more chance the trademark can be challenged as being generic.
I just found the article critical of REALTORS® being singled out, why not real estate agent?
Sorry, I just feel strongly as a professional REALTOR® to use it correctly.
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I agree with Lani. I use Realtor all the time. CAPS are annoying and it doesn’t change the meaning of the word.
Fred, Does not really matter what you think.
Proper use of the MARKS can never be evaluated solely on the basis of the “intent” of the user but rather must focus predominantly on how each mark as used is likely to be understood by the public. The same evaluation must be undertaken even if the audience is expected to predominately or even exclusively be composed of members. Members and Member Boards are encouraged to assess each use from the perspective of the public. Will the public view the MARK, as it is used, as an indicator of membership? Or will the MARK, as it is used, be misunderstood as a synonym for “real estate broker” or some other term? It is imperative that Members and Member Boards work together and with the National Association to avoid all uses of the MARKS which may suggest to the public that, without regard to his membership in the National Association, a REALTOR® is simply a provider of real estate related services.
realtor.org/letterlw.nsf/pages/mmmPartOne#OneI
I enjoyed reading this topic as presented quite nicely by Renee. She appears to have the wind and tides with her as I sailed this page and I enjoyed the mental voyage, wife will tell you I am not easily pleased in print. Thanks Renee.
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Larry,
Thanks for your nice words. I am happy that you enjoyed my article.
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HI, Renee, and welcome to AgentGenius. I look forward to a rollicking good time.
“Buying the Listing” has been around for as long as I can remember. Yeah, I’ve been guilty of taking an overpriced listing in the hopes that the Seller will come to his senses and lower the price to something that will attract a buyer. I’ve tried the 30 day approach (”Let’s price it where you want for 30 days and if it doesn’t get any action we’ll lower to my price.”) and that doesn’t work very well either.
On the other hand, I’m not exactly sure Sellers hire Realtors for their professional advice and such. I think, many times, they don’t want the hassle of marketing their home as a FSBO or they don’t like the “negotiation” part of the transaction. However, they KNOW the price. Their house is special.
You larger point is right on. Overpriced listings don’t help anyone. The house doesn’t sell. The Seller doesn’t get paid. The Realtor doesn’t get paid. And a lot of time is wasted.
Renne,
Great points..and welcome to the jungle.
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Excellent first post, Congrats! I think as agents we have all been guilty of taking an over priced listing at one time or another. As agents, we don’t have the luxury of controlling what the price of a home is listed at. We can advise, recommend, suggest, etc. a given price, but at the end of the day the decision of listing price lies with the seller. We do however have the option of choosing to not take the listing.
For agents that intentionally overstate the value of a home in order to get the list, shame on them. There is no place for that in our profession, period. For the agent that agrees to take a listing at a value higher than advised, that’s their decision. If they’re willing to take a gamble on it, that’s their business, but the key is to not be misleading to the client.
This article was so great! Thanks for the advice!
Welcome Renee!
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I echo Duke’s welcome, “welcome to the jungle” = classic. I hear that skinny punk scream’n the lyrics and writhing like he’s jones’n for sweet jane. I like it though, it’s on my iPhone, etc.
But I digress….
Welcome, who doesn’t love lava, way to open.
In our market we still see it, it’s sort-of like Bait seducing Bait, the whole affair is stinky.
Cheers.
Wow Fred, those are pretty harsh words…
I happen to agree with Renee on over priced listings. A good agent shouldn’t need to take an over priced listing in the “hopes” they can get a price reduction. Do your job right, educate the seller, and there is no “hope” involved.
But that’s just my opinion, yours obviously differs. But there is no need to be an ass about it.
PS: 99% of the time dual agency is evil.
“Don’t kill the messenger” comes to mind, as well as, “Don’t hate the player, hate the game.” and lastly, “Punish the behavior, not the person”. What can be gained from attacking the person? Attack, argue, refute, agree or disagree with the ideas.
You disagree, super cool, that’s what comments an discussion is all about, but like you said in your comment “So who are you to say what is a “good” or “bad” reason???”.
Cheers Fred.
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Welcome Renee. Duke said it best, welcome to the Jungle! I think we might be more like the Muppets and Sesame Street sometimes though. I will raise my hand as Miss Piggy and then we have Big Bird, Ernie and Bert and yup, Oscar the Grouch. But we are a big (mostly) happy family in the end with all the pros and cons of a family. More importantly, we share, learn, debate and discuss lots of meaty real estate topics, just like this one!
I agree with you about the overpriced listings. In the end, they cost you time, effort, money, good will with the sellers and a lot of frustration. We have made it a key priority this year to NOT take any. I can’t say we have taken them as a bait and switch trick, but we did take them thinking the seller can try “their” price and then move to market price, but when that doesn’t happen it’s just bad all the way around and for that reason, no more OPLs for us.
Have a great evening.
We’ll just have to agree to disagree on dual agency Fred. I abhor it. I think it’s wrong on many levels. To be brief, I don’t see how it’s possible to represent both sides of the transaction and give each client full representation. I think dual agency is one of the fundamental things that is wrong with our industry.
But this isn’t the venue to debate dual agency.
I don’t see where Renee is saying who can and can not be a Realtor. She said, “I **feel** one of the problems facing the real estate industry is that people get into the business for all the wrong reasons. . .” (my emphasis on ‘feel’)
She feels that way, it’s her opinion, and she’s entitled to it. My thought is real estate is like any other profession — people become agents for a wide variety of reasons. There’s no universal “right” (or wrong) reason to become an agent. I do firmly believe those people that get into real estate only for the money generally don’t do well. I suspect the same could be said for any other profession where the potential to make a decent living is there.
The barrier to entry into real estate sales is ridiculously low. In Arizona you can get a sales license in a 9 day “crash course”, hired by almost any broker in minutes and be on your way. All you have to be is 18 years old, have a relatively clean criminal record and pass a licensing exam that isn’t all that difficult. You could be a 4th grade dropout and get a real estate license. Partly because of that, and partly because so many brokers use a “hire anyone with a license and a pulse” business model this industry has more than its fair share of worthless practitioners.
To be fair though, there are also some tremendously effective agents out there that make this profession shine.
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jay this comment referring to me makes no sense because my previous posts seem to have been removed by the author. … are we in China?
Why limit your concern just for us REALTORS®? How about real estate agents? How about For Sale By Owners? And finally the Holy Grail – real estate agents listing their own homes? Talk about a total disconnect from realty in listing price.
We can dispatch 5 real estate professionals and probably get 5 opinions of value. How can anyone be arrogant enough to decide who is correct, until the listing is exposed to the MLS and the price is embraced or rejected.
I don’t think that anyone in our profession has not missed the price at one point or another. Or after giving the Client our best council the Clients decides on the listing price. As stated above, it is up to each of us if we want to take on the listing or pass.
I’m with Jay that we all have different reasons and motivations for getting into this business. In the final analysis is your opinion more important than another?
It’s up the the consumer to pick out the best fit for the agent they want to work with.
When the main method of aquiring buyer leads was through listings, I can see why an agent might take an overpriced listing.
Now that the entire MLS can be every agents own inventory through their website, I fail to see why an agent would enter into an agreement to spend money and time on a listing that will never sell.
Basically, the ROI for a listing is much lower than the ROI of the same time, money and stress put into driving truly motivated buyers and sellers to the inventory on your website.
If a seller is willing to price correctly, I will absolutely list it. I am even willing to accept a listing at the high range of my estimate of value, so long as scheduled price reductions are written into the listing agreement. However, I will not invest my time and money in someone elses delusion.
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Everyone has the right to their opinion (or so I thought). Realtors are very competitive and will do just about anything to get the listing… List to last right?
So what if the price is a little higher (say 10-20k)… After a while the seller will realize it and and the agent will get them to lower it if they really want to sell. Nothing seems wrong with that.
I hope this post does not get deleted like my previous ones.
Renee, I love you for writing this. It’s been such a source of frustration for me because any successful agent in the business knows that the seller’s best chance of getting top dollar is to price competitively to create urgency, yet one of my biggest competitors overprices all of her listings, only to later chase down the market with her price reductions. It’s a lose-lose for both the seller and potential buyers who like the house because they cant understand why the seller was given such poor advice in pricing.
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Fred,
I think you are missing the point of my article. Realtors are supposed to be the “professional.” When Realtors over price a listing just to get the business, it devalues our expertise. Anyone can throw a price on a property and hope that it sells but it takes a true, confident, expert to walk away when a seller is being unrealistic.
Renee
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It’s your opinion… I am not missing the point. If you ask a seller to get 3 agents opinions on price, all will be different. All will use different comps. If the seller picks the agent with the highest price that is their decision. It does not make the REALTOR any less “professional”.
The reason I have issue with your article (and your past ones) is that they seem very one sided. This is not “personal”, it’s MY opinion. In many cases it’s not a matter of right or wrong, not bait and switch either, it’s just different views and opinions which we all have.
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Fred,
You are incorrect because if all 3 agents are going for the same listing, all 3 would have the same comps from the local MLS and all should come to a similar conclusion on price. Where there is a break down is when the seller pleads that they feel that their home is worth more than what everyone else is getting and then the agent gives in and prices the property for what the seller wants. Yes, the seller has the right to choose whoever has the highest price but we as professionals should know when to walk away. In my opinion when a Realtor misleads a seller it is acting in bad faith. It is a bait and switch because you are getting their hopes up by letting them believe that their home is worth the higher price and then you pull the rug out from under them when you go back to them and tell them they have to reduce.
This is my first article here on Agent Genius so when you say “my past ones”, I don’t know what you are referring to.
Of course my articles will be “one sided” as you say, because I am writing them from my point of view, my opinion and my experiences.
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I am not incorrect, it’s my opinion – there is no right way (your way – so you think) or wrong way (I guess that’s me – boohoo). I was referring to your Trulia Voices articles and comments.
You say what you want, but don’t tell me your right and I’m wrong. We all have our own way of doing business and your way and mine are different – both can be professional.
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So Fred, in other words, you are saying she is wrong for telling you that you’re wrong?
What color is the sky in your world?
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Sue,
I am happy that you like my article. What you have experienced is much what I have endured through out my career in my area and it inspired me to write this article.
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Fred,
I never told you, you were wrong. Certainly when I feel someone is wrong, I have no problem with letting them know.
I stand behind everything I write. Thanks for being a fan! : )
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I’d be more of a fan if you didn’t delete my comments = bad
I talk to walls and rocks and pipe, etc.
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LOL where did that come from?
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Here are Fred’s original comments:
COMMENT ONE:
Well I have read your “junk” on Trulia, and I’m not sure how you got to be a writer on here with your attitude. I think they made a bad mistake.
You say “people get into the business for all the wrong reasons whether it be to earn extra money, to flip properties, or to buy investment properties and those are not the reasons to become a Realtor” — So who are you to say what is a “good” or “bad” reason??? Give me a break.
And there is nothing wrong with agents taking an overpriced listing in the hopes they will get it reduced and sell it. Oh I’m sure in your next post you be telling everyone about how evil “dual agency” is too. That’s a hot topic for you.
COMMENT TWO:
There is nothing evil about it… research her posts on Trulia (too bad you can’t see the one’s Trulia REMOVED from her)… But what about her point I mentioned Jay? Who is she to say who can be a REALTOR?
I think our friend Fred might need to up his dosage on his anger medication.
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Where are my meds!!!! LOL (JK) I’m fine now.
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I saw this in your bio, Renee: “She is not afraid of a little controversy or ruffling a few feathers every now and again and is always up for a good debate.”
Ask and ye shall receive, I guess.
I haven’t seen this much fun since I wrote about the death penalty.
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Hi Ken,
LOL! It is fun isn’t it? I came in with a bang! : )
Perhaps you guys should write about duel agency and the death of the real estate profession as a result of Google and others…now, we’re having fun!
Ok this is what the Introduction To Ethics unit two from the Kaplan Professional Schools, California Real Estate Agent (First License Renew) book says on course 2: Ethics:
” Sale, Lease, and Exchange Transactions: Unlawful Conduct.
1- Misrepresenting market value.
Real estate law prohibits knowingly making a substantial misrepresentation of the likely value of a real property to an owner or buyer for the purpose of:
a – Securing a listing. This practice is known as highballing. Agents know that sellers want to hear the highest price for their property ( even though it is not a realistic price). When asked why they would knowingly take an overpriced listing, agents give a dozen reasons, from “He can always come down; I want my For Sale sign in this neighborhood” to “I get lunch wiht the manager and win the monthly listing contest!”
b – Acquiring an interes in the property for the licensee’s own account.
c – Inducing the buyer to make an offer to purchase the real property.
So, Renee I agree with you 100 percent we need to be ethical and professional on how we advise our clients.
Great posting!
In Southern California there seemed to be quite a bit of that a few years ago. But with so many distressed properties on the market and folks who are “upside down”, the bait and switch as you describe it is not as common right now.
I still see agents in here do that. Not so much because they want the seller to go down but because they want to get more calls. More signs mean more publicity and more calls. More calls, the better the opportunity to sell something else.
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Personally I think that if you tell the Seller what you think the home is worth and they want to list for more, knowing that they may have to reduce later, and you decide to indulge their fantasy, you have done nothing morally wrong. I know that often the seller will lay awake at night imagining how they can spend the money and when the time comes to reduce they won’t. I know that about half the time they will forget that you advised them to list for less. I know that frequently you are wasting your time, energy and money when you take listings like that but I really don’t think you are acting unprofessionally. Maybe stupidly, but not unprofessionally. You could look at it that you are truly representing the interest of the seller to let him sit on the market unsold for a year or two because that is what they want to do. Hell, you are doing the other homes sellers a favor, making them look like good deals!
I have had several overpriced listings that actually did sell for substantially more than anyone ever thought they could. Cash purchasers. Fell in love with something intangible and bought. Really! Quite a few times. The sellers knew they were pushing the envelope and wanted to try it. That kind of thing is much harder in this market, but not impossible in the old days.
However I think if you deliberately mislead the seller on value just to get a listing, you are very unprofessional and should be punished and sanctioned with license threatening action.
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Renee – As a supporter of the Philadelphia contingent at AgentGenius , I welcome you. Even if I eat brisket, I still miss cheesesteaks.
Looks like you dove in with an interesting conversation in the comments. Always a good sign. Whether you’re right or wrong, sane or out-of-your-mind a good conversation in the comment section is one of my favorite things, even if they can get a little feisty at times.
Welcome to AgentGenius Renee.
What I see in my area, is the agents that list overpriced are those agents that don’t directly pay for their own advertising.
Well they pay, in their splits…but they don’t see it that way.
No CMA’s just “they ask me to list, so I did.” Then you fight the offer with comps, then the appraisers.
A well researched and knowledgeable article that was precise, uncolored, to the point and easy to read. Food for thought after dinner…
Please! Let there be no further disagreements on this blog. Ever! LOL.
Welcome, Renee!
Hi Renee,
Thanks for the great article. I’ve also told my clients that they are running a business and that they can’t help everyone they meet. Be selective and put yourself in a winning position.
Thanks again.
Richard
Renee–
Great first article. I found it informative and was given a slice of your personality in there—all things that make for a great read. You obviously love your career and are excited about sharing information.
Thanks!
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Hey Julie! Your nice comments always mean the world to me!
Renee