I recently had a conversation with a client I helped buy a home for and she was considering using a Redfin for a listing. Redfin would take a lower than standard fee for the listing. I strongly advised against using Redfin for the reasons below especially in this declining market. There is a lot of work, effort and realtor magic that goes into listing a property and having a successful outcome.
You Get What You Pay For.
1. You might save on the front end but you will absolutely lose on the back end. Especially in this declining market, an owner needs an experienced real estate agent that is willing to put the time to understand the details of your property (neighborhood, property issues, Historical Preservation Overlay Zone, developments, etc.), help mitigate risks with respect to the property like unpermitted improvements and title issues (my legal background is unique for that) and MARKET THE LIVING HECK out of the property, which typically is an intensive in person effort involving open houses and private showings for about three weeks. A salaried, poorly incentivized, or busy agent will not go through all this extra work. I’ve seen that time and time again, and it ends up in disaster for a seller when an agent does not put in the time to do open houses, understand the property/neighborhood, meet with buyers at the property, highlight the strengths of the property at showings, and get buyers to bid up. You might save a few bucks on commission but it might cost you $100,000+ on the sales price. In my experience, Redfin agents tend to be newer agents with less experience and their salaried pay does not incentivize them to go the extra mile for clients and provide optimal service like a properly incentivized agent.
2. An agent doing little work will not get you to the price you want because they are not properly incentivized. A salaried, poorly incentivized, or busy agent will encourage you to take an offer just to be done with process. While you might save some money on the front end, the cost at the back end could be $100,000 or more. Secondly, if they do not screen the buyers and manage their expectations appropriately and the buyer drops out of escrow, your listing may be deemed “stale” and the market will no longer think its worth its value. The next buyer may offer tens of thousands of dollars less. Having an agent that will fight for your price is crucial and an agent, like myself, defending their value, is exactly the agent you want to defend the value of your property.
3. Marketing is crucial and mediocrity will hurt value. The details matter. The presentation of your property from staging, to shooting photography (2d, drone, 3d and other media), and conducting open houses and showings are vital to maximizing the sales price. While Redfin may provide a variety of services, I would not expect it to be quality. An experienced agent with a good eye, who knows what the market wants given the property and neighborhood, will seek excellence in the presentation of your property especially with the photography as that will be seen by prospective buyers online. Would you want average or exceptional staging and photographs? For example, I happen to be good friends with a well known and published professional photographer that is exceptional at real estate photography that makes a property shine unlike any other photographer I have worked with. While many agents are not involved in this process, I am also hands on in the shoot in giving creative direction to the photographer to make sure certain angles or attributes of the property are captured. I also assist spotting imperfections and moving things around the shot to make it as perfect as it can be. When it comes to staging, finding the right stager and design for the property and target market is crucial. In going the extra mile for my clients, I typically add on staging and design items from my own collection if needed free of charge.
4. You need an agent that will be willing to be at the property and meet with buyers and their agents. I have been on the buy side of a closed transaction where I never once met a Redfin listing agent. Having a listing agent that is present at the property to highlight the strengths of the property, manage issues, and build rapport and screen the buyers and their agents for interest, seriousness and credibility is very important as a seller of property only wants to go into escrow once. If you choose the wrong buyer or inadequately spot and address issues, the buyer may attempt to renegotiate the transaction or cancel escrow which can be disastrous as discussed below. I have unique method of listing that maximizes the number of buyers that an owner can choose from and also minimizes the risk of a buyer falling out of escrow.
5. It is important that your agent deeply understands and anticipates all issues regarding your property that could arise during the sale. Inexperienced, lazy or poorly incentivized agents will not do the diligence of getting into details of the property to address issues that might be of concern for a buyer and simply wait until the escrow process. However, this could be a fatal mistake if the buyer discovers something not previously addressed and the buyer uses it to renegotiate price or cancel escrow. Escrow cancellation can be disastrous as noted below. My background as an attorney and experience as a real estate broker allows me to research and understand the property history, building permits, title issues and construction issues that could be of concern to a buyer better than most other agents. Finding a strategy to address them as necessary during the marketing period and in disclosures to minimize liability so that you are able to find the right buyer is my specialty. In my last two listings, I prepared a thorough and credible diligence package and the buyers made offers without any contingencies! Therefore, my sellers did not have to worry that the buyer would back out or try and renegotiate the deal during the inspection period. My sellers could sleep easy knowing that the sale would go through.
6. An agent’s inadequate screening of buyers or failure to uncover all issues with respect to a property can lead to a cancelled escrow and devaluing of your property by the market. In this declining market, buyers are more skittish than before. If property falls out of escrow, the market may perceive that the property was not worth what it listed for or went into contract for. In this time, any back up buyers you might have had may have found other properties. Interest rates may have gone up during this time and therefore may lead to further devaluation of the property. You are now forced to put the property back on the market and the number of days on market for the property will have increased and that will give the market the impression that the property is not worth what it is asking. Having an experienced and diligence agent can avoid this outcome.
7. Redfin does not have a marketing advantage. My listings will not only show on Redfin but also the Multiple Listing Service, Zillow, Trulia, and most other real estate sites. It will also be shared with my private contacts and buyers so the reach of the listing may be even broader than what Redfin can offer.
In choosing a real estate agent, it is important to go over the details and expectations for the services they provide. Not all agents are the same. Do not hesitate to contact me so I can demonstrate how the services I offer are unlike an other agent. I treat your property with the love and care as if it was my own.
