Listing Agent Rule #1: Get the Listing

More Parallels Between Politics & Real Estate Sales: What Listing Presentations, Primary Challenges Have in Common

“If your parents don’t have kids . . . you won’t either.”

–Anonymous

[Editor’s Note:  The views expressed here are solely those of Ross Kaplan, and do not represent Edina Realty, Berkshire Hathaway (“Berkshire”), or any other entity referenced. Edina Realty is a subsidiary of Berkshire.]

Nothing could be more axiomatic in real estate sales:  if you don’t (first) get the listing . . . you won’t get the sale, either.

Ahhh, but if you take the listing at a too-high price . . . you likely won’t get the sale, either.

Justifiably dismayed Buyers will balk, showing feedback will be dismal (never mind offers), and eventually the listing will cancel or expire, unsold.

Unless, of course, somewhere along the way, the frustrated Seller agrees to reduce the price — potentially multiple times.

Polarization vs. Overpricing

The dynamic is not unlike modern American politics.

Except that, in politics, the effect is to create an increasingly polarized electorate; in real estate, the result is an epidemic of overpriced listings.

So, in ever-more gerrymandered districts, incumbents don’t fear losing a general election — they fear a primary challenge from their flank (left for Democrats, right for Republicans).

To avoid that, politicians tack to the extremes.

The catch, of course, is that once they get their party’s endorsement (or win the primary), their increasingly extreme stance(s) make it difficult to win the general election.

Pyrrhic Victory Loss; “Caveat Venditor” (Seller Beware)

Would-be home Sellers should note one, cautionary difference between politics and real estate sales:  in real estate, it’s possible for an agent who takes an overpriced listing to still come out ahead — at the homeowner’s expense, no less — even if the listing never sells.

How?

In today’s inventory-strapped Seller’s market, even overpriced listings attract Buyers.

It’s further likely that at least some of those Internet-empowered Buyers will not yet be working with an agent.

Voila!

The agent listing the overpriced home may not be able to sell that home.

But, they may be able to sell other homes to those Buyers.

If that practice sounds vaguely familiar, it should: it’s called, “bait-and-switch.”

P.S.: The irony for home Sellers who insist on an unrealistic listing price is that an ethical, skilled Realtor will convert a more realistic asking price into multiple offers.

The fast sale and resulting premium is a vastly better outcome than the fate awaiting most overpriced homes: serial price reductions, and a home that languishes on the market.

See also, “The Serenity Prayer — Realtor’s Version”; “Knowing When to Pass (on an overpriced listing)“; “Perils of Overpricing Even (Especially) in a Rising Market“; “The Centrifugal Force(s) Roiling American Politics, or, “Demographics, Self-Selection & Political Gridlock”; “Realtors vs. Politicians”; and “Political — and Real Estate — Incumbents.”

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