An Argument To Revive The Selling Agent Offer Presentation

Written by Posted On Thursday, 03 May 2007 17:00

In real estate, the two sides of the transaction don't have to be adversaries. Both the buyer and seller want to agree to a deal that will close, and in the new world of technology-enhanced transactions, the offer presentation rules have changed. Today, it's common for the listing agent to present the buyer's offer to the seller, but is that good or bad for moving the transaction along?

Selling agents once made offer presentations to the seller in front of the listing agent. She would explain the reasoning behind the price and the terms and where the buyer is meeting the seller halfway or more. The selling agent would step politely out of the way and allow the listing agent and seller to discuss the offer.

Armed with the ability to negotiate, the selling agent could address objections to the offer immediately, many times helping to forge an acceptance or reasonable counteroffer that the buyer will agree to. It's a win-win where both sides feel happy about moving things along.

To save time, agents have used FAX machines and more recently email and PDF files to transmit offers and counteroffers between buyers and sellers.

But something has been lost in the process -- the civility required of in-person communication. Each side wonders what the other is thinking. And whoever blinks first loses.

The "I-don't-win-unless-you-lose" mentality hurts sellers and buyers and is a significant reason why many real estate transactions never move forward.

"I know that technology has drastically changed the way we do business, and when it's positive I encourage us all to embrace it, (I've sold homes to foreign clients by email). But every once in a while, an old standard proves to be the better way. I'm talking about presenting offers in person," poses Ken Stanley, CRB Realty Executives HomeGroup.

"For the past few years I've seen a disturbing trend in markets across the country, for listing agents to demand that offers be faxed to them so that they and only they present those offers to their sellers. I think this became really popular after 2001 when the real estate market was in overdrive and we saw fast sales, multiple offers and bidding wars more often than not. It was a crazy time and when there were three, four,or more offers on a property the selling agents were often asking for highest and best offers to be faxed to them for simultaneous presentation to the sellers."

"I didn't agree with that procedure then, and I think it's exceptionally bad business now. The real estate market has slowed, homes are on the market longer and we're not seeing many multiple offers. But with this slowing, I'm still seeing a trend for listing agents to require offers to be faxed to them, and even worse I'm seeing selling agents faxing over offers without question! Lets face it, if we're the buyer's agent, we're not doing our jobs if we don't ensure that the seller understands the positive points of the offer that may not always be obvious or even in the body of the offer."

For example, a buyer who offers a little less on the house may do so because they're in a flexible rental and can close quickly or at the seller's convenience. Without that tidbit of information, the seller might refuse the offer not realizing that waiting for another buyer to make an offer and close may take much more time, eliminating any gain the seller would have made.

In other words, the seller can be made to realize that an offer is not just about what the seller can make, it's also about what they can save -- time, trouble, expense.

"That kind of benefit to the seller may not even be noticed except during face to face conversation with the selling agent," says Stanley. "To selling agents I'd like to say, 'Don't be lazy, it may mean the loss of a commission or worse, the loss of the home that the buyer was depending on you to get for them.'"

Obviously, the listing agent's job is to get the house sold. But in a highly competitive market where there are approximately 125 men, women and children for every real estate agent, the listing agent may not want another agent within 10 miles of the seller, particularly if the agent doesn't have the seller nailed down to a buyer's representation agreement to buy something else. If the selling agent does a great job in the offer presentation, the seller could be impressed enough to hire the selling agent when they buy another property. No listing agent wants to risk that.

But jealousy doesn't benefit the seller. Great service does. The best way to hold on to the seller and turn them into a buyer is to provide great enough service and communication that the seller wouldn't dream of hiring another agent. And that takes confidence, not insecurity.

When the listing agent bars the selling agent from making an offer presentation in person, the listing agent may not be giving the seller the benefit of the selling agent's knowledge of the offer. It also means that the listing agent, while able to retain control of the offer presentation, could unfairly bear the brunt of the seller's reaction. If the listing agent doesn't have a reasonable response, the seller won't be impressed with either agent.

"In my opinion, whether the listing agent is a control freak, or just not willing to take the time to have the selling agent meet with the seller, (read lazy here), they're not doing their job fully," insists Stanley. "Sometimes the buyers agent can speak more frankly to the sellers, getting them to realize market conditions or other factors that they didn't understand (or want to believe) from the listing agent."

Instead of helping the seller, the listing agent may be enabling the seller to overvalue their home when the market clearly says otherwise.

Sellers want the highest price for their homes, but they also want a deal that will close. It isn't the listing agent's job to barricade the seller from an offer that might be accepted. On the other hand, it's not the selling agent's job to allow the seller and listing agent to ignore or diminish the offer without a fair hearing.

Any offer that doesn't get to closing means no deal for everyone -- the seller, the buyer and their agents.

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Blanche Evans

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