4 claims REALTORS® make to “trick” you!
REALTORS® are marketers. They know how to market your home and they know how to market themselves. But are their claims, offers and online brags legit?
Let’s look at the truths behind some common REALTOR® claims and to-go-to-be-true offers. While REALTORS® must adhere to a strict Code of Ethics and some local advertising laws can deter misleading advertising, sometimes stats can be manipulated and fine print exceptions can render what sound like a great offer meaningless. Here’s what what some of those advertisements might really mean…
Claim #1: “Low flat fee or 1% commission!”
This one could be both true and false. It’s very possible that the agent is offering a lower commission for the listing portion of the commission, BUT that percentage usually DOES NOT include the amount offered to be paid to the agent who brings you a qualified Buyer with an acceptable contract.
It is common for the marketing fee the seller agrees to pay to compensate both their listing agent AND the agent representing the buyer. Offering your home for sale without offering compensation to all the other agents who may bring you a buyer, does not encourage these agent to share and schedule showings for your home with their clients.
The flat fee or low commission offer may only be dependant on you buying a higher priced property with the same agent or restrict you to only selling it only to the buyers your listing agent is working with.
Your listing agent could also initially list your home at this lower price and then call later and ask if you would be willing to offer a standard compensation amount to the other agents to encourage buyer showings and offers. In this case, it could take longer to sell your home AND you still may be paying more than the low fee you anticipated. How much did you save?
Tip: Remember that like most things in life, you get what you pay for…and if it seems too good to be true, it probably is. Be sure to ask lots of questions and check online reviews before committing.
Claim #2: “I’ll buy your home if it doesn’t sell it in 60 days!”
This marketing gimmick helps real estate agents find motivated sellers because it plays on the very real fear that many people have: “What if nobody wants to buy my home?” or “What if I can’t sell my home in my required timeframe?”
This will get the agent in the door to learn about your situation and your true needs in selling the home. When the terms of the “…or I’ll buy it!” offer are disclosed, you will typically find there are a ton of terms and conditions that effectively invalidate the offer for most Sellers. The most common condition is that the Seller needs to agree to sell their house for a certain price, usually well below market value.
If you’re thinking of hiring a REALTOR® with a guaranteed sales program, be sure to ask:
- What would my asking price have to be to guarantee you purchase it? How many price reductions would I be required to make?
- How much would you buy my home for? How much below market value is that? Make sure to interview other agents without a guaranteed sales program for their opinions of value of your house in the current market to be sure you are pricing it near a fair market value.
- Do I need to buy a home from you too? It’s common for these offers to only be valid if you also buy a home with the agent.
Many times, this tactic will get the agent in the door with promises of a quick sale at terms you could never agree to. After you see the terms, many sellers decide not to participate in the program and the agent will offer to list your home with standard sales terms. Tricky huh?
Tip: Read the fine print, ask lots of questions and be sure you are still maximizing your profit based on your specific moving/selling situation.
Claim #3: “Top Salesperson…” or “#1 agent in <your area>!”
It could be true, but what does that mean? Did they sell more homes in <your area> that every other agent? Were these numbers based all agents in the local Multiple Listing Service or just in their office? Many agents lead or work on a team and may be reporting all of the team’s sales as their own. So while advertising may shows that Agent Angie has sold 30 homes in your neighborhood, it’s very possible that those sales were actually the result of the work of Team Real Estate Group which includes 8 agents.
Tip: If a salesperson makes this claim, ask if they completed those sales personally or with the help of their team.
Claim #4: “I market my listings on the internet and on social media”
This claim might be true, but it also may just mean that their listings appear on Realtor.com, Zillow, and Trulia just like every other agent’s listings in the area. Our local MLS and many offices participate with these online services and share their listings freely for equal exposure for all agents.
So what is social media marketing? Are they simply posting “Look at my new listing” with their 400 friends on Facebook? How many of those people are likely to buy your home?
If an agent is touting themselves as a online marketing expert, ask questions and do your homework.
Tip: Ask how many daily visitors their website receives? How are you planning to promote my home on Facebook and Instagram? How do you use Facebook ads to market listings and can you show me the results you received from these ads? Make a point of doing some online sleuthing to verify any claims made about digital marketing and social media.
Looking to hire a REALTOR® who won’t give you a bunch of B.S. gimmicky advertising? Someone who can give you results and not reasons your home isn’t selling?
You know who to call.