SELLERS MAY LOSE MONEY…

SELLERS MAY LOSE MONEY using Agents That Participate in these Online Sites
By CJ Holmes, California Real Estate Broker

Perhaps you’ve read the article “Site gives real estate agents inside scoop,” specifically mentioning Agent2AgentLink and Top Agent Network.  These online networks are described as ways for agents to “post details online about listings coming to market so they can be matched to interested buyers.” This activity obviously occurs before the seller signs a listing agreement, which fact by itself raises serious issues.  The article mentioned listing agents that have used this network to get pricing feedback from buyers agents prior to listing a property, and that at least one agent has sold a property this way.

Sellers, watch out.  These type sites can be:

A)     a “free for all” where a seller’s net proceeds will likely be subject to a buyer’s price preference,

B)      a great way to enhance unapproved pocket listings for agents, and

C)      a subversion of the normal listing process that exposes the seller’s property to the entire buyer market.

Let’s address these issues one by one.

A.  Any listing agent that wants or needs buyers’ agents to suggest a property price is either:

1)      is too new to the industry to know better,
2)      not trained well enough to do a good CMA (comparable market analysis), or
3)      too desperate for the income from a quick sale so “gives-it-away” to the first interested buyer.

Quick sales leave (seller) money on the table, and really quick sales are usually (seller) cheats.  By definition, the ‘quick sale’ focus is not about maximizing seller net proceeds.

B.  Unapproved pocket listings are a violation of the Realtor Standards of Practice.  A pocket listing is when an agent lists a property, but puts the property details “in his pocket” rather than on a true Multiple Listing Service (MLS).  This “pocket listing” gives complete control over all property exposure to the listing agent, making it easy to sell to a favored buyer at the buyer’s favored price or for the agent to focus on double-ending the commissions.  The seller has been tricked into thinking the property is actually listed on a true MLS with lots of buyer exposure, so has little reason to doubt his agent’s advice.  This trick greatly reduces seller net proceeds.

These type “sharing” sites are, by definition and usage, promoting collusion between agents generally against the vested interest of sellers.  And there is simply no way to ensure a listing agent would not be swayed by the temptation inherent in these arrangements.

C.  A true MLS, like BAREIS in Sonoma County, has over the years, developed broad exposure to the buyer market and now includes every agent in five counties.  This is the exposure that sellers want and expect for their listings.  Giving the seller anything less than this could be considered a breach of the agent’s fiduciary responsibility to the client.

In my opinion, any service described as ‘giving the agents an advantage’ should immediately be suspect by all parties.  Let’s remember that it’s the CLIENTS, the sellers and buyers, whose interests are paramount.  Agents are hired representatives, legally obligated to “protect and promote the interests of their client.”

Fortunately, sellers can decide whom to hire and should use due diligence in doing so.

CJ Holmes, real estate investor since 1977, broker since 2005, and market research analyst since 2007

BUYING Real Estate RIGHT

We all make decisions based on what we think are the Facts. But sometimes what we think is a Fact is actually a Myth. In the real estate market it’s especially important to know the difference between accurate information and misconceptions because the success of your real estate transaction, whether it’s a first time home purchase or multiple investments, depends upon it.

Indeed, you have a right and an obligation to know exactly what to expect from your real estate professionals. That’s the only way you can make the right decisions for your particular real estate situation.

To assist you, here are four of the most common Myths people come across and the Facts that will help them set the record straight:

1.  Myth: It doesn’t matter whom I hire to represent my purchase, as all agents write similar offers anyway.

FACT: Research shows that 85% of agents do one deal or less per year. Many agents have little experience, and don’t want to prepare numerous offers that take a lot of time and get rejected. They are not concerned that their choice may cost the buyer thousands of dollars more on the purchase because they have ineffectively negotiated or not paid attention to contract details.

CJ Holmes & Company knows that you deserve a seasoned Investor-Broker who, with expertise, will guide your purchase to get you the best deal others just ignore. The best time to “lock in profits” is at the purchase. Since you only get one chance to “Buy the Property Right”, it makes excellent sense to hire representation that focuses on building your wealth.

2.  Myth: I will see all the available property for sale no matter which agent I use because it’s all listed on the MLS (Multiple Listing Service).

FACT: Are you sure? Which MLS? In California alone, there are 83 MLSs. Most agents belong to only one, and that can possibly limit what you see. Sometimes agents focus just on their company listings which is often to the Buyer’s detriment. Many commercial brokerages completely ignore the MLS’s.  That means that unless your agent knows how to find these properties for you, you won’t see them.

CJ Homes & Company provides Buyers with access to ALL the properties for sale, no matter what type property you’re seeking, or which brokerage has listed it. We give our buyers sophisticated shopping tools right at their fingertips, and expert guidance from our years of experience representing hundreds of buyers.

3.  Myth: I will get the best service and deal if I use the listing agent for my purchase.

FACT: Most listing agents will say what you want to hear, just to get your offer. They will be focused on a quick, easy sale to get the entire commission, and likely not be inclined to negotiate as hard for your side as for the side that has already hired them.

By the way, it is not good business, under the guise of “not working with an agent”, to get the listing agent to show you the property, answer all your questions, and then use someone else to write the offer.  Don’t do it.  That can boomerang.

CJ Holmes & Company uses professional investing techniques designed just for clients. From developing a solid plan of action, to working that plan with multiple offers for multiple properties, our clients are assured of getting the best the market has to offer. This is true whether your purchase is for your first home, or your next investment property.

4.   Myth: My agent will be there for me whenever I need him or her.

FACT: …except when he or she is out of cell phone range, on vacation, ill, has a family issue, takes another job to make ends meet, or quits…..

CJ Holmes & Company gives you prompt answers and reliable support when needed. We have designed our services to incorporate the expertise of salaried professionals so our clients are not dependent upon just one commission-based person for everything they need.

We understand the value of doing good business and you have the right to receive the best representation possible. But unless you know the difference between fact and fiction you may not be able to determine whether or not your real estate professional is working in your best interest or theirs.

Ask questions and expect answers that make sense.  Place your needs and goals as the top priority. If this is the only real estate transaction you will experience in your lifetime, you will still want it to count.  And if this is one of many real estate transactions, you will still want them all to be successful.

When you’ve considered the rest, hire the best.

CJ Holmes, owner/broker, has been investing in real property since 1977.  Starting with a fixer home, she and her husband have built a portfolio of income-producing property.  Licensed in 1998 to facilitate the constant search for investment property, CJ began Agent Representation for Buyers and Sellers in 2003.  In March 2005, she earned her Broker’s License and now brings her real estate investment expertise, experience, and energy to every client.

CJ helps buyers lock in profits, maximizes sellers’ net proceeds, and works extensively with real estate investors.  Her wise guidance literally means more money for her clients, and comes from years of personal investing experience, and hundreds of transactions.  This last market collapse has driven her to develop mathematical models designed to predict the future of real estate prices.