Retainer Fees

Status
Not open for further replies.
If I was choosing an agent on a referral, so I knew they were good and was buying, I'd have no problem with a retainer. As a seller I'm not so sure. But to be honest I've never sold a house so I don't really know jack :)

Well other than Reacher
 
CedarcrestPC said:
If I was choosing an agent on a referral, so I knew they were good and was buying, I'd have no problem with a retainer. As a seller I'm not so sure. But to be honest I've never sold a house so I don't really know jack :)

Well other than Reacher
Click to expand...

....I was gonna say.... :Stick
 
MacDaddy said:
Second, my wife and I are trying to sell two houses. have been for a year. She tried to sell her's several times before we were married. I can summarize all the efforts of all the agents we have used, and there have been nearly a dozen reputable well known agents - come in, make suggestions on improvements that should be done in order to market the house, take pictures, post the listing on their website and the MLS, and that is about it. After the initial attention and reports, feedback, etc., their contact is primarily "You need to reduce the price in order to be competitive." Lowering the price appears to be the main selling tactic after the honeymoon period has passed.
Click to expand...

Here's my perspective on your situation - assuming your house is in pristine condition, even the BEST agent can't force somebody to buy a house that they like but perceive to be priced too highly. I'm sorry y'all haven't been able to sell them, but price really does sell. You could have the Taj Mahal (which I personally wouldn't want to buy, but as an example), but if it's priced higher than the market will bear (backed up by comps), people are simply not going to buy it. Your agents could hold open houses till the cows come home, and all that will generate is more leads for buyers for their other listings. Your agents could call all the other agents they know to see if they have buyers who want what you have, but those agents are getting calls from all the other agents they know asking the same thing. Many, many listing agents are fighting over a very few buyers. Your agents could put together glossy presentation packages at their own (not cheap) expense and mail them out to 50,000 people in your area, but it would be a complete waste of time and money. Your agents could buy advertising in real estate magazines and in the real estate section of newspapers, but as with the other tactics, if the price isn't right, it'll be a waste of time and effort and money. Location sells, but PRICE REALLY SELLS.

Bottom line, as Winchester said, it's the WORST MARKET I've ever seen in my lifetime. Which means it's a buyer's market. Which also means that many sellers are going to lose money. That's a bitter pill to swallow, but it is what it is. If you don't want to lower your price, you have that right. But recognize that the higher the price, the longer your wait time will be. Conversely, the lower your price, the shorter your wait time will be. Your decision is which path you want to take.
 
Learned today that the only foreclosure in our neighborhood is for sale for $60k. :( That's just devastating to me. Granted, it the smallest, most basic house in poor condition, I'm not sure how much of that is taken into consideration. Two plus years ago a friend asked if I wished that I had waited since the market had taken such a dive and I said no, I'm still okay, my home is still worth as much or more than we paid. Now, I'm not so sure. :( We purchased in 2004, thought we got a good price, and put a decent sum down.
 
Winchester and Mei Lan, I appreciate your comments.

I was not trying to make a point regarding pricing, other than it tends to be what the agents fall back on as a sales technique. They all provide great plans on marketing, follow-up, etc - but after a few months it all boils down to "lower the price." And this after setting the price at a point they suggested a few months earlier. I've lowered the price on my old house 3 times in the last year - it is currently $30K less than what I listed it for this time last year. IF someone purchased it at the current listed price, I would make no money. Any lower, and I'm leaving money on the table - and this after painting the inside, general repair work on the outside, replacing carpet, new roof, and HVAC that is only a few years old, it will also get a new water heater when it changes hands.

FWIW, both houses are competitively priced. Houses that are selling lower are short sells, auctions, and/or foreclosures. These are typically 20-50% lower than the going market value. As someone who is not in that situation, we cannot compete on price alone. We would have to leave a $50K+ check on the table to compete with those type of sales.

Edited to add:
Winchester, I appreciate your offer. At this time both houses are currently under contract. With my old house the contract runs out next month - and I'm making plans to rent it (hopefully finding a lease purchase customer). Mrs. Mac's house has several months left on the contract.
 
MacDaddy said:
I've lowered the price on my old house 3 times in the last year - it is currently $30K less than what I listed it for this time last year. IF someone purchased it at the current listed price, I would make no money. Any lower, and I'm leaving money on the table - and this after painting the inside, general repair work on the outside, replacing carpet, new roof, and HVAC that is only a few years old, it will also get a new water heater when it changes hands.

FWIW, both houses are competitively priced. Houses that are selling lower are short sells, auctions, and/or foreclosures. These are typically 20-50% lower than the going market value. As someone who is not in that situation, we cannot compete on price alone. We would have to leave a $50K+ check on the table to compete with those type of sales.
Click to expand...

Unfortunately, those foreclosures and short sales will factor into the true market value of your house. I'm telling you, I'm thinking rent or lease really may be the way to go for sellers who don't want to lower their price. While the real estate sales market is in the gutter, the obvious converse relation to that is that the real estate rental market is HOT.
 
Madea said:
Learned today that the only foreclosure in our neighborhood is for sale for $60k. :( That's just devastating to me. Granted, it the smallest, most basic house in poor condition, I'm not sure how much of that is taken into consideration. Two plus years ago a friend asked if I wished that I had waited since the market had taken such a dive and I said no, I'm still okay, my home is still worth as much or more than we paid. Now, I'm not so sure. :( We purchased in 2004, thought we got a good price, and put a decent sum down.
Click to expand...
A few years ago my house appraised over $150,000 ... a foreclosure in my neighborhood just sold for under $48,000. There are at least 5 others listed for between $55,000 and $63,000. Fortunately for us we are not looking to sell so we are taking it all in stride and grateful for the tax break for a few years as all of this washes out. Still ugly to look at the numbers, though.
 
mei lan said:
Unfortunately, those foreclosures and short sales will factor into the true market value of your house. I'm telling you, I'm thinking rent or lease really may be the way to go for sellers who don't want to lower their price. While the real estate sales market is in the gutter, the obvious converse relation to that is that the real estate rental market is HOT.
Click to expand...
I agree with you to a certain extent. Most real estate folks I've talked to tend to lump "real" house sales a bit differently than "distressed" sales. In the long run, it's what the buyer wants to spend to get the house they want. And the distressed properties are dragging everything down.

I really can't compete with distressed sales. The volatility of that market is a joke. I bought my house in 2003 for $184,900. I had it listed at that amount this time last year. It's currently at $157,900. The real estate agent is suggesting/guessing another reduction to $150K, which she thinks will make it show up better on the real estate search sites. So much for her "selling" the house. Some folks looked at it a few weeks ago, but went with a house nearby that was auctioned for $113K. So, do I reduce it to $120K leaving a $40K check on the table, and hope no other distressed properties sell for less than that? It's insane.

Renting/leasing is not my favorite choice. Right now it's a necessary evil. We are trying to buy a place in the Nashville area, but that can't happen until we have some action on at least one of our houses here.

Ah, to be blessed with living in interesting times ...
 
One of the problems with a traditional sale in this market is that there are just so darn many foreclosures and they are not all "distressed" properties. There are a lot of houses still in good condition that are available as foreclosures which is simply not the way it usually is. Even if you're keeping those out of the picture, the distressed properties are still a huge deal because with so little work out there, contractors are slashing their prices so people can buy a run down home and get it fixed and still come out way ahead of the game. Another problem that I see with the traditional sales in this current market is finding buyers that can get qualified. It has become so much harder to get the loans now and with the market still so uncertain the banks are wanting even more out of people and even better looking deals on paper. It really is about the worst possible time to be selling and, if you're in a position to do it, the best possible time to be buying.
 
unionmom said:
One of the problems with a traditional sale in this market is that there are just so darn many foreclosures and they are not all "distressed" properties. There are a lot of houses still in good condition that are available as foreclosures which is simply not the way it usually is. Even if you're keeping those out of the picture, the distressed properties are still a huge deal because with so little work out there, contractors are slashing their prices so people can buy a run down home and get it fixed and still come out way ahead of the game. Another problem that I see with the traditional sales in this current market is finding buyers that can get qualified. It has become so much harder to get the loans now and with the market still so uncertain the banks are wanting even more out of people and even better looking deals on paper. It really is about the worst possible time to be selling and, if you're in a position to do it, the best possible time to be buying.
Click to expand...

Excellent purnts, chickie. Adding to the foreclosures not being necessarily distressed is the gubment program that is handing cash to folks who leave their houses in great shape. A friend of mine facing foreclosure did that, and trust me...that house was in awesome shape when he left.
 
And not everyone that ends up in foreclosure is a bad person that either never took good care of the home or trashes it as they leave.
 
MacDaddy said:
Winchester and Mei Lan, I appreciate your comments.

I was not trying to make a point regarding pricing, other than it tends to be what the agents fall back on as a sales technique. They all provide great plans on marketing, follow-up, etc - but after a few months it all boils down to "lower the price." And this after setting the price at a point they suggested a few months earlier. I've lowered the price on my old house 3 times in the last year - it is currently $30K less than what I listed it for this time last year. IF someone purchased it at the current listed price, I would make no money. Any lower, and I'm leaving money on the table - and this after painting the inside, general repair work on the outside, replacing carpet, new roof, and HVAC that is only a few years old, it will also get a new water heater when it changes hands.

FWIW, both houses are competitively priced. Houses that are selling lower are short sells, auctions, and/or foreclosures. These are typically 20-50% lower than the going market value. As someone who is not in that situation, we cannot compete on price alone. We would have to leave a $50K+ check on the table to compete with those type of sales.

Edited to add:
Winchester, I appreciate your offer. At this time both houses are currently under contract. With my old house the contract runs out next month - and I'm making plans to rent it (hopefully finding a lease purchase customer). Mrs. Mac's house has several months left on the contract.
Click to expand...

Under Contract or just still in a listing agreement? Two totally different things but very confusing also.

I had a nice long reply for you but we are getting way off topic from what I intended. Talk to you agent(s) and ask them to prepare a Market Analsis for each house so you can see what your competition is. Then discuss what you can do to BE the competition.

And don't hold your breath on a lease purchase. 95% never go to closing and you'll be stuck with repairs. Not to mention the rental market is also way down.
 
unionmom said:
Madea said:
Learned today that the only foreclosure in our neighborhood is for sale for $60k. :( That's just devastating to me. Granted, it the smallest, most basic house in poor condition, I'm not sure how much of that is taken into consideration. Two plus years ago a friend asked if I wished that I had waited since the market had taken such a dive and I said no, I'm still okay, my home is still worth as much or more than we paid. Now, I'm not so sure. :( We purchased in 2004, thought we got a good price, and put a decent sum down.
Click to expand...
A few years ago my house appraised over $150,000 ... a foreclosure in my neighborhood just sold for under $48,000. There are at least 5 others listed for between $55,000 and $63,000. Fortunately for us we are not looking to sell so we are taking it all in stride and grateful for the tax break for a few years as all of this washes out. Still ugly to look at the numbers, though.
Click to expand...

yep. That is the new normal. Which we will be in for many years to come. It may take 10+ years to recover the loss in values.... if we ever do.
 
I want to thank everyone who offered their insite into my question, it has given me a lot to think about. All the reposnses were as I expected for them to be like. I don't like the idea either. But it is coming at some point in time.

The smart real estate agents are having to learn to be Consultants and not order takers. The day of just pushing paper around is over and if they want to stay in business, they will have to change their business model. I had to and it will change again as the market changes.

I'm going to ask a moderator to go ahead a lock this thread as we are starting to get off topic. I will be glad to answer anyone's questions any time, just start a new topic or send me a private message.
 
Status
Not open for further replies.
Back
Top