How To Avoid The Integrity Paradox In Real Estate
If you plan to sell your home, expect to lose tens of thousands of dollars or more due to an integrity paradox that exists for homeowners with real estate listing agents.
Prevention is simple though, will you avoid being burnt?
The Integrity Paradox In Real Estate
The integrity paradox has been around in real estate for a long, long time, and online valuation tools are not resolving the underlying problems. Here is why:
- Having a real estate listing agent with the highest integrity, education, and training is an important thing, because it equips you with an advocate who instills the confidence in you to make the critical decisions required when marketing, negotiating, and selling your home.
- Having a valuable home allows you to realize greater proceeds when you sell it. The more your home is worth, the more you'll likely attain from a buyer, and thus the greater your "net proceeds" after closing on the sale of your home.
Notwithstanding the truth of each point, it creates a paradox for real estate agents who are interviewing for the job of selling your home.
On the one hand, an agent committed to honesty and integrity entails an obligation to provide you accurate pricing guidance, as this is the first chance to demonstrate integrity and earn your respect and confidence that this is the agent that needs to be by your side when the chaos of contract negotiations ensue.
On the other hand, the real estate agent knows that you are a proud homeowner and are likely see more value in your home than will a dispassionate buyer prospect who is looking at many homes similar to the one you wish to sell. Additionally, the agent must compete with other agents who will provide higher estimates of value in order to win your business.
The paradox arises from the need for integrity once the agent has been hired (after a deceptive listing presentation that mislead you to believe in a higher value for your home).
How To Avoid The Integrity Paradox In Real Estate
Believe it or not, you can completely avoid the negative impact of this paradox by understanding why it exists and then take the following precautions.
First of all, the paradox exists because home sellers want a real estate agent of the highest integrity and also want the most money for their home. The desire for money makes them value the latter most, thus they forgo the evaluation of the former. In other words, in the quest for receiving the most money for their homes, most sellers assume every real estate agent they talk to is highly educated, honest, and of the highest moral standards, thus they are able to believe the inflated evaluation when it is "sold" to them.
And if you think it doesn't matter and that you can "start high and lower your price later," you should read some of the articles where we have demonstrated a proper initial asking price determines whether or not a home seller gets top dollar for their home. When your home hits the market, it should sell in 4 to 14 days (unless liquidity is too low for this, like you'll find in the top 1% of the market).
I have outlined the steps to take when choosing a real estate listing agent, if you follow them and make an informed decision when choosing your agent, you will both avoid the integrity paradox and also net the highest possible dollar from your home sale.
We will sell your house in 4 to 14 days ... ask us to show you how!
The National Association of REALTORS conducted a survey and found that 72% of home sellers hired the first agent they interviewed.
Maybe that is why so many sellers fail to sell on their first attempt, or even worse, sell their home for less than they would get had they used a progressive home selling plan. It doesn't have to be that hard, and you don't have to give your home away either! Let us help.
Tell us who you are, we'll reach out to you to set up a time to simply talk about the sale of your home. No strings attached, use Joe Manausa Real Estate to start your home selling preparation, you'll be glad you did!
Steps To Take To Avoid The Integrity Paradox
- Interview multiple agents for the job of selling your home - Spend some time talking to your friends, searching on Google, and researching Facebook for the most active real estate agents in your marketplace. Read past-customer reviews in order to select several of them to interview.
- Instruct them that you do not want to know their opinion of value for your home, you are evaluating them first - This is a key step for you. You should only care about your agent's home valuation once you have first selected an agent of high integrity who will provide an honest opinion. Most agents know your desire for a higher value will obscure the fact that they do not have a brilliant marketing plan nor the personnel on their staff to properly market your home for sale for top dollar. Make them show you how they will get your home sold.
- Assume nothing, make each agent complete their full presentation - Once you get past the first agent interview, you will be tempted to interrupt the next agents when they are covering something you "already know" due to your first agent interview. DO NOT DO THIS. Remember, this is not only about educating you, this is primarily about you evaluating them. Later agents often look good because you assume they know everything the first agent shared with you.
- Research the internet, determine their online footprint - If you spend more than a minute on Google and cannot find much about the agent, you should know that homebuyers will be far less likely to be exposed to your home. Every agent will be able to "put your home on the internet on hundreds of sites," but it is a rare real estate listing agent that has perfected digital marketing and can reach the largest segment of ready buyers for your home.
- Read testimonials on third-party sites - There is no reason to reinvent the wheel. If an agent has hundreds of past clients providing five-star reviews on trusted sites like Google, Facebook, and even Zillow, then you know you are in experienced, honest hands. This is how "word of mouth" works in the digital age.
- Select the agent that has the background, education, and strong endorsements from past clients - You are going to spend a lot of money to get your home sold. Whether you are working with the top real estate listing agent, or just your buddy from work, the combination of the agent's fee and the money you could lose with a sub-par plan represents tens of thousands of dollars (or even more if you have a high-end home). If you follow the previous five steps and choose the one who has hundreds of written reviews online, you are highly likely to be thrilled and profitable with your home selling experience.
- Instruct your hired agent to provide a range of values for you to consider when selling your home - Only after you have hired your real estate agent should you discuss your home's valuation and the specific initial asking price that is most likely to generate multiple buyers for your home. Remember, all real estate agents know you want as much money as possible for your home. Don't let unscrupulous agents use this knowledge to "out-bid" honest agents in order to win your approval based upon something that will end up hurting you financially.
I hope your understanding of the integrity paradox in real estate serves to save you money on the sale of your home. If you have any questions or comments, you can leave a comment below or drop me a note anytime.