According to the “2009 Profile of Texas Homebuyers and Sellers” study conducted by the Texas Association of Realtors, 8 out of 10 sellers said that they would not use the same agent again to sell their house. The survey doesn’t mention why sellers wouldn’t use the same agent again, but the Texas Association of Realtors speculates that it could be attributed to sellers no longer living in that agent’s area or that agents do not spend enough effort staying in contact with past clients. I think there are other reasons the article doesn’t want to admit.
Here are some ideas why I think such a large number of homeowners would not use the same agent again.
The previous agent:
- Didn’t sell the house in the first place.
- Failed to keep the client informed during the listing process.
- Didn’t offer much value to the process.
- Did not work aggressively to sell the house in a timely manner.
- Did not prepare the house to be competitive in the market.
- Could not negotiate effectively to get a desirable contract.
- Did not meet the client’s expectations.
- Handled the closing process poorly.
- Mislead the client about price in order to get the listing, resulting in a lower sales price and longer time on market.
- Overpromised and under delivered.
The survey suggests that agents need to work harder to effectively deliver value to their seller clients. Effective agents that work hard to serve their clients do reap the benefits of repeat business and referrals, but sadly they seem to be in the minority according to this survey. That’s why it’s important to do your homework when selecting an agent to sell your house. You want to find an agent that will not only sell your house but will make you want to tell everyone about the great job they did. The 20% that clients want to use again are the agents we focus on when we select agents for our clients. Let us find a top producing real estate agent for you.
Source: Texas Realtor Magazine, Marty Kramer, April 2010, p. 23
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Real estate agents and the NAR should take notice of this information, as it does not bode well for the industry. Perhaps something needs to change with how business is done?
Joshua:
Possibly. You have to also consider that a large number of homes listed on MLS do not sell. Can’t imagine recommending an agent that didn’t sell my house, even if the reason it didn’t sell was beyond my agent’s control. I do agree from the Texas Realtors article that we don’t keep in contact enough with past clients but I also must assume that bad agents don’t get recommendations.
My areas of focus on reform would be to force higher education requirements or an apprenticeship to reduce the ease of getting licensed and I’d also suggest having an option of commission based or an price list type of pricing structure so clients could chose their options and do some things themselves. However this will not be popular because clients want free service if the house doesn’t sell and to pay as little as possible when it does. Perceptions will have to be changed first. We’ll probably evolve into a pricing structure like lawyers do.
Sellers would also be much happier if they only paid for their own representation and if buyers paid their own way. In order to divorce commissions, lenders would have to allow a separate line item on the HUD-1 for buyer representation and permit the buyer to add their representation to the loan balance. If this ever happened we would see more use of retainers. A the end of the day, sellers don’t want to write checks, and buyers want to feel like their seller paid “representation” is free.
Thomas:
While buyer representation is not free, it doesn’t cost extra. The buyer’s agent fee is usually taken out of the listing agent commission so it’s either extra money kept by the listing agent or a portion paid to the buyer’s agent.
I actually think billing like a lawyer would be a better option where everything is a-la-carte. However, I’m sure that wouldn’t go over well. People are only used to paying when the house sells, and not paying when it doesn’t. That’s a tough mindset to change.
Bill Petrey
AgentHarvest
It really bothers me to see that the level of dissatisfaction is as high as 80 %. I don’t agree with the statement of May 24,2010, simply because people pay for results.
Harry:
The 80% may not all be dissatisfaction. I bet a lot of it is just that their agent wasn’t impressive or they think that just any old agent will do. The reason the a-la-carte thing might not go over is that people are not used to paying for agent services until the sale. I think there would be some resistance in adopting a paying policy. Even though I say that, flat-fee agents are gaining in popularity and they offer a large portion of services that are paid for up front, regardless of the house selling or not.