Why Picking the Wrong Agent Can Cost You Money..or your Dream Home

Let’s face it. Realtors are portrayed pretty poorly in the media – typically as either a  pushy used car salesman type, or someone totally aloof in their own world (I’m looking at you, Phil Dunphy). These stereotypes used to really bother me, because they didn’t reflect the hard-working, dedicated professionals that I typically encounter. We work with some truly excellent agents that make me proud to be a Realtor.

In the last few weeks, the spring market has really started to heat up. Many newly minted “agents” are throwing their hat into the ring to make, what they think, is a quick buck. As a result, we’ve encountered some very interesting situations. Maybe it’s just that I am nine months pregnant and my patience is wearing thin, but I felt the need to educate the public on how picking the wrong agent can cost you. Here is a breakdown of some of the types of agents – and real life encounters we’ve had with them – that are the reason for our embarrassing portrayal in the media. So, please excuse me while I rant…

THE HARD WORKING, COMPETENT AGENT

As I mentioned above, there are many, many excellent agents out there who go above and beyond for their clients and do a truly fabulous job. While most agents we deal with fall into this category, and I could go on and on about all of the wonderful aspects of those agents, this post is not about those Realtors!!

THE LAZY AGENT

This type of agent is probably the most common offender in our profession. They got into real estate because it offered flexibility and they figured they didn’t have to work a 9-5 schedule. Turns out, they were right. Real estate is not 9-5, it is 24/7! As agents, we are available when our clients need us, when other agents need us, when appraisers need us, and when home inspectors are available. We not only must be available 9-5 for the banks and title companies we work with during the work week, but also when our clients are available — usually on the weekends and in the evenings.

Agents who thought they were in for a cushy schedule get a rude awakening.

Most eventually adapt to their new “flexible” schedule. However, there are those that cut corners to stay in the industry and try to make it work – to the detriment of their clients and anyone trying to do business with those clients.

Frequently, this type of agent also doesn’t respond to questions or if they do, it takes them hours and the information is incomplete. They usually don’t respond on weekends or evenings and if they get back to you, they act as if it is an inconvenience. This sort of response can cause many buyers to simply move on if they are not getting the information quickly enough or are not satisfied with the information do receive. It’s the spring market — there are lots of listings and many of them have deadlines so buyers need to make quick decisions. Many buyers just say… “Next!”

THE PART-TIME AGENT

On the exact opposite end of the spectrum, there are many agents out there selling real estate “on the side.” They may just work part-time, or it could mean they have a full-time job and they sell real estate only on weekends and evenings. So, they are far from lazy and are often working very hard, but they can be tough to reach and often don’t know the ins and outs of the contract and general “norms” of the industry.

We aren’t knocking people trying to get started in the industry. It’s a tough job to get into as you often don’t get paid for several months {fun fact – we only get paid after a client goes to settlement – so by the time a new agent gets a client, finds them a property or a buyer for their home and then goes to settlement, it’s often six months with before the agent gets a check for their work}.

I can understand that many people need to pay their bills. What I cannot understand is agents who will not answer their phones or emails from 9-5. It is completely unacceptable and an enormous disservice to their clients. If you have a listing and someone wants to show it, taking eight hours to get back to that agent might mean the buyers moved on to another property. That means a seller may have missed out on their buyer. If you’re a buyer, same deal. You might have just lost the opportunity to see a hot new listing that could now be under contract.

THE INSINCERE AGENT

Worse than the lazy agent is the insincere agent. Luckily, we don’t come across this type of agent very often. The insincere agent will tell you there is another offer on a property to try to get your clients to improve their offer when in reality, the other offer doesn’t exist. Or, they might selectively choose which of your questions to answer, not replying to you if they answer is something you won’t like. We reserve most of our venom for this type of agent.

There just is no excuse not to operate professionally and honestly in this, or in any, profession.

That brings us to our next type of agent…

THE NON-REALTOR AGENT

Most people don’t know there is a difference between a Realtor and a real estate agent. All Realtors are real estate agents but not all real estate agents are Realtors. Being a Realtor is an additional certification or membership that a real estate agent can obtain. Becoming a Realtor means that, among other things, you must adhere to the Realtors’ code of ethics. This is an important differentiating factor because it holds Realtors responsible for not lying to their clients or fellow agents. If they do, they could be fined and put their license in jeopardy.

THE INEXPERIENCED OR JUST FLAT OUT BAD AGENT

While this type of agent isn’t devious and is often well-meaning, it can be one of the most dangerous types of agents to work with as a client. The problem is – they don’t know what they don’t know. Even worse, their clients usually don’t know what their agent doesn’t know!

We once had an agent tell us that her and her client are not currently on speaking terms so she couldn’t get back to us on our offer. I mean… where to even begin!? Long story short, we moved on. That house is still on the market and to be honest, I would be shocked if it sold anytime soon.

Another agent recently told us proudly that they will turn away any offer that is not full price. This property was priced significantly higher than the comps. It, too, is still on the market. Granted, this agent’s client should take a lot of the blame for this, but the agent shouldn’t get a free pass.

Part of our job as Realtors is to educate our clients into the appropriate pricing for the property and at least encourage a “conversation” between buyer and seller through counter-offering.

Even if an offer starts out low, many times the seller can still get the buyer up to a price that is acceptable with a few rounds of countering The fact is, once a buyer is mentally invested in a property, they often will come up higher than they originally anticipated. But, you won’t know this as a seller unless you engage them with a counter. It is highly ill-advised to reject any offer, no matter how low it is. We had a listing where the original offer was over $100,000 under the list price – we ended up ratifying a contract on the property at a price that was significantly higher than the first offer and perfectly acceptable to both buyer and seller.

Sometimes, the agent doesn’t even know how to put together an offer and we’ve had to draft the offer for their client – or re-write it completely. An agent who recently wrote an offer on one of our listings did not know he needed to include a certain contingency that his client definitely required. We nicely let him know that he probably meant to include it. Omitting this contingency could have been a major issue for his client.

Another example of how an inexperienced agent can blow a deal is by not understanding the “norms” of how an offer process works or not taking the time to find out how an agent is handling a multiple offer situation. If the listing agent doesn’t set an appropriate deadline, or doesn’t get back to buyer agents, buyers agents won’t know how to proceed.

As a result, a seller could miss out on additional offers that would have escalated in price, leaving tens of thousands of dollars on the table for the seller.

We had a situation this week where a client was ready to accept a full price offer on their property over the weekend. However, we could tell based on the interest we were getting that by waiting until Monday and setting a deadline time that all agents were made aware of, that they would get more money. By waiting, we were able to get them an additional $30,000 with no home inspection negotiation (saving them from having to make repairs) and no appraisal contingency.

Knowing the pulse of the market, we got a much better deal for our client.

Similarly, if a buyer agent doesn’t know enough to let the listing agent know that their clients have interest, they could miss out on the property. Time and again, we’ve had buyer agents call us weeks after our listings go under contract letting us know that their clients were interested, even though they had never been in touch. Inexperienced buyer agents can be detrimental if they don’t know how to find out about properties before they hit the active marker, to pull the appropriate comps, to best present the offer in multiple offer scenarios, or which types of inspections to schedule. There is a lot that an inexperienced agent just doesn’t know.

THE BOTTOM LINE

Picking a real estate agent is a major decision. It can directly affect both your bottom line and your ability to buy or sell a house in the time and manner that works for you. As we’ve shown, there are a wide variety of agents in the business. Most are wonderful to work with, but there are still many – and especially in the spring market – that put their clients in tough situations that could cost them money. Often, the client doesn’t even know it. It’s critical to carefully think through who you are working with to buy or sell. Check out our top 10 tips to picking a realtor here. Also remember that even if you are working with one of the good ones, your agent can’t control the agent on the other side so sometimes it is difficult to get the information needed.

Here at The Goodhart Group, we are always actively looking for how we can improve our service to our clients and continue to raise the bar for what a great real estate experience should be. If you have any questions or need help buying or selling, please don’t hesitate to reach out. We are happy to help anyone in the DC Metro area! If you live or are moving elsewhere, we’d love to connect you with a reputable agent in our worldwide network. Our passion is helping people love where they live!

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