How Some Big Real Estate Brokerages Are Conspiring Against Home Sellers

Posted by Eric Peterson on Tuesday, May 5th, 2020 at 12:39pm.

 
When you hire a real estate agent to sell your home you have every right to expect the brokerage the agent works for has your best interests in mind at all times. How will you feel when you find out that might not be true? 

It’s basic Economics 101 that you will receive the best price for your home by advertising it with the widest net. You want to advertise your home to all the real estate agents in your area and as many buyers as possible who are in the market for a home like yours.

What if I told you we are hearing about more and more real estate brokerages that are trying to sell their listings by only advertising them to the agents that work for that specific office?

Why would they do that?

In some instances, it’s because a listing agent is friends with another agent in the office. They might only let that other agent know about your home because they are hoping in return when they have a buyer client, they will be the only agent who knows about a listing from their friend.

Other times it is because the real estate brokerage business is competitive. Some brokerages are telling agents if they work at their office their clients will have the first shot at any listings in the office. The brokerage may even incentivize their agents by paying them a bonus when their office represents both the buyer and seller. That is good for the listing agent but it's not good for you.

In either, case by not advertising your home outside the office the brokerage makes more money. How does that help you as a home seller? The brokerage is helping their business at the expense of your equity!

A surprising statistic is the average real estate agent only sells about 2 homes per year. When an agent doesn’t have much experience, you are at risk of pricing your home too low. The only way you can know for sure is exposing your home to the entire market. Without doing that you miss out on the auction effect where your home may receive multiple offers and sell for over list price.

As an example, we recently saw 2 similar homes sell in a neighborhood. One home was sold at list price before it was advertised to the whole market and the buyer agent works in the same office as the listing agent. The 2nd home was advertised and had over 20 showings and sold for $35,000 over list price. I don’t know about you, but $35,000 is a lot of money to me.

When you hire us to sell your home my promise to you is we will always put your needs over our brokerage. We will get your home sold without any of this nonsense that doesn’t help you. Whenever you are ready to talk contact us directly at 512-791-7473  or email eric@koparealestate.com.

 

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