Can we handle the truth?

1.11.11
Creative Commons License photo credit: Cia Gould

I guess we believe what we want to hear. There are so many examples of this in both real estate and real life.

I’ll start with real life. I detest trying on clothes at the mall. I suspect I’m not alone. The problem is that each time I head off to the Promised Land, I am filled with such high hopes – hopes that my “needs” will be met.

We all have expectations. And keep in mind that I am not what you would call a recreational shopper. I have neither the time nor the money for that. Rather, when I set out to commandeer a new item of the clothing persuasion, it is with purpose and with the expectation that my needs will be satisfied.

Where my clothing needs are concerned, they are usually quite humble – a pair of jeans to replace the ones with a single, splotchy pink leg, the victims of having cohabitated in the washing machine with the red towels, or a swim suit that doesn’t make me look like a Ballpark frank (they plump when you cook ‘em).  The problem is that I leave my house, complete with soft lighting and waste-up mirrors, feeling, if not exactly Gisele Bundchen’s identical twin then at least not entirely hideous, only to arrive at the retail store dressing room of horrors.

Women know what I am talking about. Let’s say you are looking for black pants – pants that won’t have the people behind you in the open house mistaking you for Minnesota. First, you must carefully select “candidates” from the display racks until, when you are laden with enough “candidates” to outfit the 181st Infantry, in sizes ranging from Gisele Bundchen to “No. Three Mexican Combo Platter” (because, this week, it is really anyone’s guess), you are escorted to the dressing room.

This is where it gets ugly. (Keep in mind these dressing rooms were designed by the same, twisted men that designed the carnival fun houses.) You are assigned a room lined with floor to ceiling mirrors, each more distorted than the next, and the room is lighted in a way that compels you to suddenly come clean about all of your past transgressions including where you were when Kennedy was shot. Fortunately, it always has a happy ending.

“I love those refrigerator slip covers,” squeals the helpful retail store employee. “We just got them in!”

“Uh, their black pants.”

“Yes, well, I meant I love those black pants,” she recovers. And then comes the closer. “They look GREAT on you!”

Go figure, but “great” was exactly what I was going for. Sold! Sure, she could have told me the truth, a truth I would discover later back at the homestead – that I just purchased a pair of britches that make me look like a Weeble, but could I have handled the truth? Or would I have just sought out a different sales lady in a different store who would tell me what I wanted to hear?

Steve and I tend to think of ourselves as advisors and fiduciaries, not as “sales” agents. This distinction is so important to us and our company that our “Join Our Team” page on our website says the following:

Our clients are central to our culture, and providing outstanding representation is our passion. Our clients are not “leads” or “prospects” to be “converted.” Rather, they are real people who trust us to partner with them on a very serious, very important undertaking – the purchase or sale of a home.

As a real estate agent, your license says that you are a “salesperson.” At San Diego Castles Realty, we ask you to ignore this part. We do not sell anything. We do represent home buyers and sellers, offering a premium blend of experience, marketing, innovation and client care.

Unfortunately, sometimes this doesn’t prove to be in our best bottom-line interest. So be it. We believe it is the only way to conduct our business; that’s our story and we’re sticking to it.

Too often, people will only hear what they want to hear. Here are a few examples we see every day.

  • Price. Ask five agents what your home is worth and you will get six answers. That is because price, at least before you have actually sold, is a prediction – an opinion. I suppose human nature would dictate that one like the guy “biggest” who is dangling the biggest prediction. But the reality is that we all use the same data to come up with our estimates of value. No one has secret comps. So ask yourself, given the data, why the estimates of value are (often wildly) different. Is one agent using flawed assumptions or logic, or is maybe another telling you what you want to hear to win your heart and your business? And, please, don’t assume that because on agent is seemingly more bullish on your home this will equate to him being more aggressive on your behalf, or that his optimism will magically translate to a higher sale price. All things being equal such as marketing, market knowledge, professionalism and competency (and all things, by the way, never are equal), your home will sell for what it is worth. Period. Yes, those pants make you look great, but do they really? Or are you just rewarding the one who told you what you wanted to hear only to end up looking a little goofy later?
  • Process. No one wants to embark on a process that they know will be timely or inconvenient or stressful or fraught with uncertainty. The home buying and selling process is all of those things, and the agent that is honest with you, establishing realistic expectations, is not necessarily an incompetent nincompoop. He might be, but more often he is fulfilling his obligation and duty as advisor. I’ll just give you a “hypothetical” example, and I totally made this up because this could never happen to us. When your agent cautions, for instance, “hypothetically” speaking, that pursuing a short sale might not be in your best interests because the hardship case might be a tough one given that you make more money that Steve Jobs and, oh by the way, there might be tax or other consequences due to the old cash-out refi, but he is happy to give it a try after you have talked to your CPA or a real estate attorney so that you are fully informed as to the potential implications, hiring your cousin’s friend who says this will be easy-peasy, “Just give me 30 days and I’ll have you closed,” may be a case of falling victim to hearing what you want to hear.
  • Commissions. We all know commissions are negotiable. And we all know that levels of service and competencies vary widely among agents. I will also tell you that that latter does have an ultimate impact on market time and sale price. No matter, I am seeing a resurgence of ads from companies using the old deflection tactic to earn your business. “Our customers saved an average of $259,735 in real estate fees!*” they say. (*Based on a typical full-service commission of 148%.) Half-truths aside (we can only quantify “savings” by comparing proceeds checks, not closing costs), first, understand that there is no such thing as a “typical” commission. Next, recognize that “full-service” is one of those hollow, throwaway terms that means virtually nothing. There is no prescribed “full-service” playbook. You want to be saving money, so that is what you may hear. And maybe you will, but chances are you won’t.
  • Marketing. So what about that “service” component? The agents you speak with will all offer their own marketing programs and their own, unique spins on what works and doesn’t in getting your home sold. Are you hearing what you want to hear, or maybe are these agents telling you what they want you to believe? I’m not going to waste pixels here talking about what works or doesn’t, but I do want to simply caution you to put on the old thinking cap as you listen to the various pitches. Some agents will tell you brochures or professional photos don’t matter yet they will be resident in your living room every Sunday sitting the time-honored open house – presumably (wink) because open houses are the bomb when it comes to attracting qualified buyers. Others will tell you open houses are a waste of time, as is every other conceivable form of advertising save entry into the MLS. The point is that you should expect full-service however you and not your agent might define it – whether he is charging you $1.95 or 10%. That is your agent’s job, and your bottom line should be your only concern.

In my next installment, I will talk about lazy agents. Specifically, if your agent is one of the growing number who in the MLS remarks labeled “Directions to property” enters “See MapQuest,” “Use GPS,” or “Find it yourself stupid,” you have my permission to take him out back and punch him in the nose. The idea is to make it easy for the buyer to see your home, not to create dumb little obstacles because it saved your agent the trouble of looking up the name of the nearest cross street, which momentarily escaped him, himself.

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