Are selling agents part of the problem?

[raptorduck]

Some of you know that I have been looking for houses in North County (since May) and that I had looked up here in the bay area (since January).

Now after looking at well over 100 homes I have written only 1 offer. I have “attempted” 5 others. In 4 of those 5 cases, the house sold for “less” than I was willing to pay. Amazing, because I offered or was going ot offer below asking in 3 of those 4, by at least 10% below asking, and asking for the 4th (above asking for the 5th).

Why would those 4 sellers essentially chase me away from buying their house for more than they actually got? Well, essentially their selling agent did. This utterly amazes me. The sellers of these houses have no idea that their agent screwed them from a better sale. In all cases, I showed the selling agent my bank pre-approval letter to indicate I was a serious qualified buyer.

Here are my brief experiences on those 6 cases. In the order in which I came upon them. All this happend this year.

1. I was going to offer 93% of asking on a house that had been on the market 90+ days and had my agent tell the selling agent we wanted to write an offer. The response? “Do not consider writing an offer a penny below asking.” Sellers had purchased the home in 2005 and were not willing to take a loss. 4 months later, the house was still not sold and sellers dropped the asking price “below” my planned offer price. That was a month ago and it remains unsold. I have seen other houses since then and am no longer interested in that one. After seeing so many, quite frankly, it is still overpriced and the selling agent did me a favor.

2. Another case where I wanted to offer 91% of asking. Another case where the selling agent indicated they would not consider anything below asking so don’t bother writing an offer. Now, 5 months and 3 price reductions later, the house went off and back on recently, with an asking 8% below my original planned offer price.

3. Selling agent let me write an offer. I wrote it for 85% of asking (expensive fixer upper). Seller countered, I countered back, seller countered again, and we got to within $50k of eachother. I held firm and so did she. After 3 more months, seller dropped the asking price to below my “first” offer price. Again, I was by then more savy on the market and no longer interested. Since then, they let the listing expire.

4. The first house we fell in love with at first sight (bonus for seller). It was perfect. To boot the ad said it had over $200K in built in electronics (18 zones of sound/plasma TV’s in 3 rooms) built in. We just loved it and told the selling agent we were writing an offer at asking. You will not believe what happend next. We made the mistake of saying how much we loved the electronics. Selling agent said, “oh, did you know the electronics is seperate and will cost you another $200k, so if you want it you will have to write your offer for $200k more. My client will not take a below asking offer.” The add said nothing about the electronics being seperate. In fact it said they were built in. I think he just saw our obvious enthusiasm and excitement about the house and electronics and saw a chance to make more money for his client. The result was, however, that he pissed me off with that dirty trick and I walked. A month later the house sold for $210k BELOW my original asking price planned offer ($410k below what he told me I would have to pay).

5. The only time I indicated I was writing an offer above asking. It was an underpriced bargain in a great area. Cheapest house on the nicest street and all that. The seller’s agent said, too late, I am closing offers at 2pm and you won’t be done by then sorry. Ok, 10 offers came in and it sold for slightly more than I wanted to pay but why oh why chase away more “bidders” in a buyer’s market? I would have helped drive the price even higher.

6. Another house we fell in love with. It was a stretch so I indicated I was writing an offer for the bottom end of the range they gave. Seller’s agent said they really want the top end and they had other offers comming in. We walked. 2 months and the house was not sold so we tried again (we reallly did like the house). Suddenly, after the other offers dissaperaring previously and no sale in 2 months we were told 2 more offers had just come in that day so we walked again. Again the house was not sold. Turns out both times we are pretty sure the selling agent was bluffing. My agent was representing another buyer recently who looked at this same house and found out there were no offers pending or comming. It sold last week and she thinks at below my planned offer, but we will have to wait for escrow to close to find out.

Now I have to thank those selling agents because I am far more savy and knowledgeble about the market. But they sure seemd to screw their clients out of better sales. They seem to be part of the problem to me.

I am writing about my experiences because in #6 above I was particularly frustrated as that was the house I really wanted. But the selling agent chased me away. If it sold for less than I was willing to pay I am going to be really pissed as I would have paid even more than I offered. I feel like finding the sellers and telling them their agent screwed them out of extra $$ by playing games.

Anyway, I now play even harder hard ball with selling agents and have all the time in the world for their little games.

I wonder if any other people here have experienced what I have from selling agents. I also note that many act like they are doing me a favor showing me the house and come accross as arrogant and cocky. I experienced this in Santaluz recently and was so turned off by the attitude of the selling agent, I told my agent to take that house off our list. I would not want to negotiate with that #$hole. Come on dude, your clien’t house has been on the market over 100 days, get a clue!

[Ex-SD]

raptorduck: You come across as a very savvy guy to me.
These sellers don’t understand that in most cases, “the first offer you receive is usually the best one you’re going to get”. Every time I have wanted to buy a property and the agent pulls the crap that you’re getting……..I also walk. I just won’t be part of their games. As for an agent telling you to not even bother to submit an offer below asking price…………I’m sure you are aware that they are obligated by law to submit all offers to the seller. The good news for you out of all of this looking is that prices are dropping and will continue to do so for quite a while so eventually, you’ll find the right home at the right price.
Good luck!

[Ex-SD]

raptorduck: You come across as a very savvy guy to me.
These sellers don’t understand that in most cases, “the first offer you receive is usually the best one you’re going to get”. Every time I have wanted to buy a property and the agent pulls the crap that you’re getting……..I also walk. I just won’t be part of their games. As for an agent telling you to not even bother to submit an offer below asking price…………I’m sure you are aware that they are obligated by law to submit all offers to the seller. The good news for you out of all of this looking is that prices are dropping and will continue to do so for quite a while so eventually, you’ll find the right home at the right price.
Good luck!

[nostradamus]

I wouldn’t assume that the seller is an innocent party to all this. They might have told their agent to not take less than asking. Also, I think dumb sellers end up working with dumb agents, hence the arrogance/rudeness at showing. They should be kissing your arse.

[nostradamus]

I wouldn’t assume that the seller is an innocent party to all this. They might have told their agent to not take less than asking. Also, I think dumb sellers end up working with dumb agents, hence the arrogance/rudeness at showing. They should be kissing your arse.

[Alex_angel]

Most of these recent RE agents are nothing more than white trash trasplants that moved here when RE was “HOT”. Most of these people are cheap car salesman type people. Sure you have the odd nice agent, but these agents and agencies are the reason RE got so out of hand.

I have known a few people that bought their house at the $200-300k range, years ago and wanted to sell. Comps in the areas were around $500-600k. They’d be happy with $500. The agent convinced them to sell for $600k. Well they waited and waited and then POP!, the bubble burst and now they would be lucky to get $500k in that area. Well they shouldn’t have listened to the shill.

Another friend of mine bought right at the peak in 2004. They saw this inland that they liked. The house was on the market for $500k. They had a bank loan approval for $545k. They made an offer for $500k, got countered, so they upped it to $525, got countered again and upped it to $545k. Well they bought it. Guess what? Thier freaking shiller agent told the selling agent that these guys were approved for $545k. They didn’t know that their agent divulged this info until after they closed. The buyer and seller agent are both as crooked as each other.

In the end Raptor. Be glad those houses didn’t fall through. You just proved that you can get a home for $200-400k cheaper. It will only get worst for them and better for you.

[Alex_angel]

Most of these recent RE agents are nothing more than white trash trasplants that moved here when RE was “HOT”. Most of these people are cheap car salesman type people. Sure you have the odd nice agent, but these agents and agencies are the reason RE got so out of hand.

I have known a few people that bought their house at the $200-300k range, years ago and wanted to sell. Comps in the areas were around $500-600k. They’d be happy with $500. The agent convinced them to sell for $600k. Well they waited and waited and then POP!, the bubble burst and now they would be lucky to get $500k in that area. Well they shouldn’t have listened to the shill.

Another friend of mine bought right at the peak in 2004. They saw this inland that they liked. The house was on the market for $500k. They had a bank loan approval for $545k. They made an offer for $500k, got countered, so they upped it to $525, got countered again and upped it to $545k. Well they bought it. Guess what? Thier freaking shiller agent told the selling agent that these guys were approved for $545k. They didn’t know that their agent divulged this info until after they closed. The buyer and seller agent are both as crooked as each other.

In the end Raptor. Be glad those houses didn’t fall through. You just proved that you can get a home for $200-400k cheaper. It will only get worst for them and better for you.

[raptorduck]

I note that I only wrote an actual offer once. The other times we indicated we wanted to write an offer. That was when we got the responses we did. Still, I think the selling agents should have let us or encouraged us to write an offer. Seller could always reject it.

I also note that while I started looking this year as a far more savy buyer than when I bought my first house 8 years ago in a seller’s market where I overpaid by $100k, and while I am even far more savy (or less ignorant) now than when I started earlier this year, I still consider myself a less than sophisticated buyer.

[raptorduck]

I note that I only wrote an actual offer once. The other times we indicated we wanted to write an offer. That was when we got the responses we did. Still, I think the selling agents should have let us or encouraged us to write an offer. Seller could always reject it.

I also note that while I started looking this year as a far more savy buyer than when I bought my first house 8 years ago in a seller’s market where I overpaid by $100k, and while I am even far more savy (or less ignorant) now than when I started earlier this year, I still consider myself a less than sophisticated buyer.

[Raybyrnes]

Something does not add up. You are a high net worth client and this is a large transaction. We are not talking about 100K condo. So typically both parties should have excellent representation. Why did your agent not advise you to write the offer? They are well aware of the fact that the agent has to at least present the offer to the seller.

I tend to believe that the sellers are more of the challenge than the agent. The seller is letting the agent know up front that any offer other than full offer is unacceptable and will result in them finding an agent who can better represent them for full asking price.

The agent should be firm with his client to garner some flexibility but they were probably leveraged by the seller when they iniitially took the listing. They might simply be relating the opinions of the seller rather then recognizing that their job in this instance might be to sell their own client on the offer. JMTC

[Raybyrnes]

Something does not add up. You are a high net worth client and this is a large transaction. We are not talking about 100K condo. So typically both parties should have excellent representation. Why did your agent not advise you to write the offer? They are well aware of the fact that the agent has to at least present the offer to the seller.

I tend to believe that the sellers are more of the challenge than the agent. The seller is letting the agent know up front that any offer other than full offer is unacceptable and will result in them finding an agent who can better represent them for full asking price.

The agent should be firm with his client to garner some flexibility but they were probably leveraged by the seller when they iniitially took the listing. They might simply be relating the opinions of the seller rather then recognizing that their job in this instance might be to sell their own client on the offer. JMTC

[raptorduck]

Raybyrnes. I think in a couple cases the seller was probably driving the firm response, but in others I think it was their agent. In either case, I think the agent is supposed to be the more sophisticated real estate wise and less emotional so should counsel their client. It is obvoius that later they did indeed drop their prices dramatically.

In a few cases we indicated verbally while we were still looking at the house that we would be writing an offer and were discouraged as indicted in my post by the selling agent. In others my agent contacted the selling agent by phone after we viewed the house to ask if there were other offers and that we wanted to write one and was discouraged as indicated. She would either say we wanted to write an offer or we were considering writing one. Either way, not a good idea to discourage any interest in this market me thinks.

[raptorduck]

Raybyrnes. I think in a couple cases the seller was probably driving the firm response, but in others I think it was their agent. In either case, I think the agent is supposed to be the more sophisticated real estate wise and less emotional so should counsel their client. It is obvoius that later they did indeed drop their prices dramatically.

In a few cases we indicated verbally while we were still looking at the house that we would be writing an offer and were discouraged as indicted in my post by the selling agent. In others my agent contacted the selling agent by phone after we viewed the house to ask if there were other offers and that we wanted to write one and was discouraged as indicated. She would either say we wanted to write an offer or we were considering writing one. Either way, not a good idea to discourage any interest in this market me thinks.

[Raybyrnes]

I agree with you. I remember a very interesting point made when working on my MBA. What is the first job of every CFO? #1 to keep his job #2 to guide the financial management of the company. Might hold true for the Agent. First job is to keep a client happy, next job is to sell the home. As you pointed out the client did not know all the variables so in the end maybe they lost money but ignorance might be bliss. Relative to other offers at the point they sold they might have been very satisfied with their agent. So there might be a time variable at work aswell. As you stated you opinion of their house changed as you got more savy of the market. Maybe their firmness softend as they became more savy aswell.

[Raybyrnes]

I agree with you. I remember a very interesting point made when working on my MBA. What is the first job of every CFO? #1 to keep his job #2 to guide the financial management of the company. Might hold true for the Agent. First job is to keep a client happy, next job is to sell the home. As you pointed out the client did not know all the variables so in the end maybe they lost money but ignorance might be bliss. Relative to other offers at the point they sold they might have been very satisfied with their agent. So there might be a time variable at work aswell. As you stated you opinion of their house changed as you got more savy of the market. Maybe their firmness softend as they became more savy aswell.

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