pricing a home for sale
Should a Sacramento listing agent know the seller’s bottom line? Well, you know, if you have to ask the question, generally the answer is no. I’m just a bit more vocal about it. When I hear sellers headed that direction, I ask them to please stop. Because I don’t want to know their bottom line. It’s none of my business, actually. When we settle on a list price for a home, it becomes my job to get that price. Let’s not muddy the waters or cause more confusion by talking about how much less we will take.
Besides, it might never come to fruition. If I believe I can get the price we list at, that’s the price I tend to get. My goal is to deliver a full price offer (or better). If I spend my time considering the seller’s bottom line, it is possible I could slip up. Not intentionally, mind you, but I do multi-task at times. If I don’t know it, I can’t blurt it. And I don’t want to know it anyway. It undermines the premise of a listing agent. My fiduciary is to my seller.
I talked with a seller yesterday in El Dorado Hills who tried to tell me they would be willing to underprice a home. That tactic doesn’t necessarily work very well in a market of strong inventory. There are more homes for sale in El Dorado Hills than in other neighboring communities. Although I asked her to please let’s just focus on the price she wants, the seller continued to talk about taking less for her home. She seems very eager to get rid of it. Makes me wonder what’s wrong with it. Plus, it makes me hope she ends up listing with me over somebody else who might take advantage of this situation.
I don’t want to know the seller’s bottom line. The bottom line to me is the sales price. Buyer’s agents ask me all the time how low will the seller go? Like, if I knew I would squeal, which I wouldn’t. Or, if I would be so stupid as to venture a number. Which not only violates the fiduciary relationship, making it against the law, but geez, such an extremely ignorant thing to do. I have no idea what a seller will or won’t do. Even if they tell me, I don’t know because I am not inside their head.
Another seller yesterday owns an over-improved property in a neighborhood of mostly 1970’s homes in Citrus Heights. His home burned down a couple of years ago and he rebuilt all but one wall. It’s basically a brand new home in an area with zero new homes. He sounded like he hoped he could get an extra $100K for this home. But I have my doubts about that. People want to buy a home in a neighborhood of similar homes. If a buyer wanted to pay $100K more for a home like his, they would do it in a neighborhood of comparable properties.
In this particular case, the seller’s bottom line is probably way too much. A lesson he won’t learn until it’s been on the market for half a year. Maybe it’s better for another agent to invest that time. I don’t mind being the second agent. Sometimes, I will accept overpriced listings if the seller is reasonable. But in this case, I don’t know if the individual in question is a good risk for me to undertake. I can envision him developing frustration because things aren’t working out the way he imagined. I’ll take blame for my own mistakes but not for somebody else’s. Besides, my own are much rarer.
If you would like to hear something hilarious about Zillow and Zestimates, consider this. When I asked a new agent in my Midtown Lyon office what he thought about a listing I had placed on Lyon broker tour a few months back, he said that he believed we had priced it too high. When I asked him to explain how he came up with that idea — because when an agent is still in training, you never know what process they use to determine value — he said he looked it up on Zillow.
My mouth fell open in shock. I’m afraid I gave him a lecture, probably a speech he was not expecting, about how no professional real estate agent anywhere in the country ever in a million years would rely on a Zillow Zestimate, and if he wants a future in the Sacramento real estate business, he needs to learn how to estimate value independently. Don’t you be caught dead taking a Zestimate, I warned. Pricing a home is a service we offer, as a Sacramento Realtor, to our clients. We must be able to accurately and precisely compute market value.
I don’t think that guy is talking to me anymore.
It doesn’t matter if you’re a buyer’s agent or a listing agent, or you do a combination of the two services, an agent needs to know how to price a home. If only life were that simple that we could go to a public website and gather all of our information and never have to retain a specialist for services, but that’s not reality. Not for now, anyway.
We can’t use FaceTime for a doctor visit, although that’s a pretty good idea. You know, we could always drop by around lunchtime to offer a sample of blood or have our vitals taken in a private drive-through booth. Instead of wasting time sitting in the damn waiting room and reading old copies of Golf Digest.
To price a home for sale, there are many values to take into consideration and to compute that far surpass the data a person can obtain on Zillow. It doesn’t mean that Zillow is bad by any stretch, there is a lot of excellent information on that site, and sometimes, let’s face it, I admit to stooping so low as to tell other buyer’s agents, hey, go look at Zillow. The Zestimate for my listing is $625,000 and yet it is for sale at $575,000. What a great deal for your buyers! Send your buyers to Zillow, too!
Some of those agents, let’s face that, too, they don’t know any better, as evidenced by that new agent in my office and my daily interactions with other buyer’s agents.
I check out the Zillow Zestimate so I can properly explain to my sellers — whom you can bet your bottom dollar have already looked at Zillow — why that value is incorrect. That’s one of the reasons they really need a top listing agent. Because the professional Sacramento Realtors, well, we don’t rely on Zillow for market value.