Real estate agents to avoid.
by Neil Jenman
Reading Time: Apx 4 mins
This is not easy to say, but it needs to be said:
Many times, agents who call themselves ‘NUMBER ONE’ are the biggest crooks in their area.
By “crook” I mean dishonest. I mean misleading conduct.
These dishonest agents catch a lot of honest home sellers. They also hurt a lot of home sellers. Badly.
The three main ways sellers get hurt by crooked “number one agents” are:
FIRST – ADVERTISING COSTS:
The crooked “number one” agent charges sellers thousands of dollars for needless upfront advertising. These agents know full well that the main reason for this advertising is to promote agents, not properties.
Crooked agents urge all sellers to spend big on advertising – even if the agents know the eventual buyer. After all, it’s not the agents’ money, it’s the home sellers’ money.
If their homes don’t sell or they sell below the amount originally quoted by the agent, the sellers lose all the money they’ve paid for advertising. Advertising that was of absolutely no use to the home sellers but that promoted the agents and attracted new leads for them.
SAFETY TIP: If you’re selling, here’s how to protect yourself from losing thousands of dollars in advertising: REFUSE TO PAY UPFRONT ADVERTISING COSTS.
SECOND – COMMISSION COSTS:
How much commission do “number one agents” charge?
As much as they can get.
The sellers who pay the most commission are the sellers with the least resistance.
A major point to remember is that these “number one real estate agents” are usually the number one persuader. They have mastered the art of separating you from your money.
They have all the glib lines about paying extra because you are getting the best.
The best what? The best crook?
These so-called Number One agents put themselves first, they don’t put customers first. They are the number one “dollar extractors” – your dollars extracted from your bank account into their pockets.
Behind the scenes, they talk constantly about GCI – Gross Commission Income.
Number one for them does not mean number one for you.
There is no such thing as a real estate agent who has never discounted commission. Incredibly, the crooked agents often buckle and charge less. As well as GCI figures, they are obsessed with dollar value of property sold. You’ve seen the ads: “Nigel Nofriends from Grabit and Runn Real Estate sold a billion dollars of real estate.”
SAFETY TIP: If you’re selling, here’s how to protect yourself from losing thousands of dollars in excessive commission: REFUSE TO AGREE TO THE FINAL COMMISSION RATE UNTIL YOU SEE THE FINAL PRICE.
THIRD – SALE PRICE:
Most sellers suffer the biggest losses on the sale price of their homes, especially with many so-called “Number One Real Estate agents”. These agents race from one seller to another, operating at high speed, always focusing on the next sale. Once they sign-up sellers, they pass everything to their “executive assistant”.
And here’s something you must know about “Number One Agents”. They are number one in turnover. They sell the most homes. They don’t sell the most homes for the most money. The price is irrelevant. A sale at any price is their goal – which is why most sales occur when the sellers agree to lower their prices, not when the buyers agree to increase their prices.
The biggest crooks like methods that require the least work. Less work per sale means more sales – simple.
These agents also prefer methods which exert high pressure on sellers to lower prices. This often leads to auctions.
No matter what agents say, selling by public auction is the worst way to get the best price. As an industry training manual states: “Auction is the fastest and best conditioning method”.
Crooked agents love auctions, they don’t love clients. Many constantly push auctions as the best way to sell. Such agents aren’t just crooked, they are also stupid (if they believe what they are saying).
But as one agent-insider quipped: “Most auctions should be classed as a crime scene.”
Obtaining a financial advantage through deception is a crime. That’s how many “number one real estate agents” make sales. It’s called fraud.
SAFETY TIP: If you’re selling, here’s how to protect yourself from selling too low: REFUSE TO PAY ANY MONEY UNTIL YOUR HOME IS SOLD AND YOU ARE HAPPY WITH THE PRICE.
That’s the way businesses should operate.
HONEST AND COMPETENT AGENTS
One agency recently promoted itself thus:
“At NAME OF AGENT, we are not Number One – YOU ARE!”
They were, of course, making clients Number One.
This agency, like all honest and competent agents, has three major ways of making sure clients are number one instead of agents.
FIRSTLY, NO COSTS UNTIL SOLD
Honest and competent agents don’t demand money in advance. They don’t include sneaky clauses in fine print about taking legal action against sellers who refuse to pay advertising costs.
Competent agents are confident. Unlike many agents – especially Number One agents –competent agents know that sellers will be delighted with their service. These agents won’t charge honest sellers who aren’t happy with their service.
Yes, a guarantee of no charges – for any reason – until sold, is the first sign of an agent who puts sellers first.
SECONDLY, COMMISSION IS ALWAYS NEGOTIABLE
Ethical agents know that it would, at best, be a bad deal – and at worst unethical – if they charged the same (or more) commission than their competitors for giving the same service and achieving the same price.
If agents claim they can get you a higher price and this entitles them to a higher commission, let them prove it.
If they bring you a high price, maybe, you can pay a higher commission than the typical “number one real estate agent” who turns over dozens of homes at any price.
But insist on delivery first, payment second.
THIRDLY, GENUINELY SKILLED NEGOTIATORS
Most “number one real estate agents” know nothing about negotiation – at least not when it comes to the best price. These agents class negotiation as “conditioning” sellers into accepting a lower price.
Survey sales made by these “number one real estate agents” and here’s what you’ll find –homes massively short-sold. Sellers missing out on tens even hundreds of thousands of dollars. Millions lost on top-end homes.
And, in many cases, sellers are unaware they have been short-sold.
Agents who are genuinely skilled at negotiation will not use that skill against sellers, they will make sure sellers get the best price.
Instead of focussing on the sellers’ lowest price, the truly good (for sellers) agents focus on the buyers’ highest price (the BHP).
If you ask an agent what the initials BHP stand for and they tell you “Broken Hill Proprietary”, you’re likely looking at the wrong agent to sell your home.
But if the agent replies, “BHP stands for Buyers’ Highest Price,” you’re likely looking at the right agent to sell your home.
The right agents do not boast about being first. The right agents put clients first.
So, you crooked agents with your little flashy cars and your big egos, don’t run off to your lawyer and demand they “sue Jenman” (although I wish some would), try going to your clients and saying: “From now on, I will be putting you first instead of me.”
And then you might earn something that feels better than any commission cheque.
It’s called trust and respect.