New Metric for Evaluating Realtors: Average Number of Showings Per Listing

Realtor Scorecards

Yeah, yeah, there are dozens of metrics (quantitative benchmarks) for judging how good/effective Realtors are (Brokers, too).

For most consumers (and not a few Realtors), however, there’s really only one number that counts:  sales.

No surprise, the agents who sell the most homes each year proudly trumpet that fact in their direct mail, email, on social media — and every other way they can think of.

Quantity > Quality

Are sales relevant?

Of course.

But, they’re not dispositive.

Toyota sells a lot more cars each year, but I’d still rather drive a BMW.

McDonald’s outsells Manny’s, but guess where I’d prefer to go for my anniversary dinner?

H&R Block does more returns — but, that’s not who does my taxes.

You get the idea.

Realtors who sell 50 (or 150!) homes a year do that by employing an army of assistants.

Once clients are under contract, it’s those folks — not the agent — who clients often find themselves dealing with.

Realtor Metrics, Take #2

What other, performance-based benchmarks are there for evaluating Realtors?

Three popular ones are: 1) “Sales Price as a % of Asking Price”; 2) “Average Days on Market”; and 3) “Average Sales Price” (shows which area(s) the agent focuses on).

While each of those can be useful, each has failings, can be distorted by extraneous factors, and can otherwise be misleading.

Instead, I’d argue that perhaps the most valuable statistic of all for evaluating listing agents is much more obscure (and not publicly available):  the agent’s average number of showings per listing.

“The Too-Fast” Sale

Here’s my logic:

A home that sells after only 2-3 showings** –perhaps to the listing agent’s own Buyer — really hasn’t been exposed to the market.

And, if a house hasn’t really been exposed to the market, it’s impossible to say if the price the Seller immediately accepted reflects fair market value.

At the other end of the continuum are houses that remain unsold after dozens of showings.

Buyers’ unmistakable message to the Seller?

Their home is overpriced.

In turn, that means either: a) the listing agent goofed; or b) their client did (most likely scenario: the client insisted on overshooting the agent’s price guidance).

“Goldilocks Number”

All of which is why I’d suggest that the optimal number of showings** prior to sale is about a dozen.

That tells you that enough Buyers saw the home that, if it had been underpriced — especially in an ongoing Seller’s market with scarce inventory — it would have triggered a price war (i.e., the home would have been in multiple offers).

However, the home didn’t get so many showings that it sat unsold, the marketing had to be revised (or at least, refreshed), and inevitably, the price ultimately reduced.

Realtors who can consistently and skillfully walk that market (and client) tightrope  . . . are the ones you want to work with.

**Exposure on Broker Tour: in the Twin Cities, local agents hold new listings open each Tuesday from 11 a.m. to 1 p.m.  A well-attended Broker Tour is equivalent to multiple showings.

See also, “Flip Side of a Seller’s Market“; and “Why I Don’t Price Other Realtors’ Listings.”

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