You know, I come across a lot of clients with a lot of different thoughts and opinions on things that I am an expert on but want to tell me how to do my job… and yeh I know I am supposed to listen and service my clients. However, I have to ask “if you know so much why are you hiring me”?
Anyway, there are tons of misconceptions and misinformation that buyers and sellers think they know when it comes to selling residential real estate in South Carolina, and I’d bet this applies throughout all of the United States. So, I am writing this blog in an effort to educate the consumer and help my fellow Realtors.
The invention of the internet changed the game entirely as it did with most of the business world today, and real estate is no different. It totally flipped how real estate is done on its ear.
1. NAME OF THE REAL ESTATE COMPANY MATTERS
This one is one in particular that chaps my behind. The name of the company has ZERO, NIL, NADA, NOTHING, ZILCH, and whatever else word you can use to do with real estate sales. It USED to matter before the internet. See, back in the day-long before the world wide web as it was once known, the name of the real estate company was a factor because of name recognition. People would call up companies from the phone book or know of a particular name of a company thinking they knew more than other companies, but with the internet, all agents and companies are on a level playing field. Obviously, the larger more recognized national or local companies try to convince you that their company brings more to the table because they have a “big name”.. but truth is, it matters not. Your house, the location, the market conditions, supply & demand, and the agent you hire gets the property sold, not the company. In every local market, mine here being Charleston SC, there is one in particular that goes out of their way trying to convince the area this is the case.
2.REALTOR® & REAL ESTATE AGENTS ARE the SAME THING
I hear the public use the word Realtor & real estate agent interchangeably but the truth is they are not the same thing. Truthfully, the word Realtor® isn’t an actual word, it a trademarked term that was created when the National Association of Realtors was formed. You can be a real estate agent in South Carolina and not be a Realtor and still sell real estate without a problem. Once, you get your license from your state’s licensing board to sell real property, then off you go. Sales agents or brokers are not required by the state to be a “Realtor”. Being a Realtor just means that the agent pays yearly dues to an association in return for the perceived benefit and the right to use the made-up term “Realtor®”.
3. OPEN HOUSES ARE GOOD TO DO
This one is one that really annoys me. I am not saying some good couldn’t come out of holding an open house, but sellers have this perception their agent should hold an open house as if it’s going to produce a buyer. Sadly, open houses only account for 1% of the acquisition of buyers transactions. So really sellers, you’re just wasting everyone’s time. All holding an open house does is potentially benefit the onsite agent to possibly get the name of other neighbors who may want to sell, or get the names of possible buyers who are just looking around for something to do or compare. The internet allows every possible buyer to view homes online, so they are just coming to see it up close, and since 90% of home sales happen with a buyer’s agent involved open houses are just a waste of time. The largest benefit you’ll get out of an open house is possible feedback (if people are brutally honest which they usually aren’t). The chance of an open house actually finding the buyer for your house is SOOO remote it’s not worth doing. It is an older antiquated practice that was done decades ago BEFORE the internet when people had to drive around to see homes that were for sale and go in them to see what it looked like. Also, years ago before the internet, open houses were done with an invite to other select agents or brokerages so they could look at a property for their prospective buyers. Shows like Bravo’s Million Dollar Listing will show agents throwing open houses irritatingly perpetuating this myth, but I personally believe that’s for TV as they are unnecessary. The biggest benefit to an open house would really apply to a developer / builder of maybe an entire neighborhood or condo high rise where they don’t want to exactly have to pay out as much commission to a buyer’s agent to find buyers, so they hold an open house in the hopes their on-site agent gets the properties sold without having to put the listing(s) on MLS.
4. HOW OLD THE BROKERAGE COMPANY IS
As with the other 3 above, the internet has nullified this as a significant factor in today’s real estate world. If anything it may be a detriment that the company you choose to list your house for sale has been around since the 50s because a lot of times the agents in that office will be much older and potentially out of touch with today’s technologies. You tend to see this a lot in small or remote towns where there may only be one or two companies. The world of real estate sales today revolves around tech and the internet, so older companies have a tendency to have older agents who in my experience are really tech clueless. The internet like mentioned before has leveled the playing field so just like #1, the number of years or decades a real estate company has been in business is moot. There is something to say for a seasoned experienced agents with a lot of different kinds of deals under their belt, but the company’s length of time in business is pointless. Since each Realtor is essentially their own miniature company within a company you’re really hiring the agent, not the Realty company per-say.
5. THAT REALTORS “HAVE LISTINGS”…
A lot of buyers, particularly new buyers think that certain agents, agencies, or companies “have listings”, special only to the properties for sale. The fact is, all agents and Realtors have access to all the same homes for sale (assuming the property is on MLS). I say that with some trepidation, only because there are a couple of rare instances where this does NOT apply. If a seller asked or arranged for a particular agent/brokerage to sell their house for them, but not advertise it (known as a pocket listing), then yes that company would “have listings” that others do not. However, that’s rare. The other instance would be in the case where a company doesn’t participate in the local MLS which is extremely rare. This only occurs maybe if it’s a small builder, or new development, or maybe a resort such as Kiawah Island. In the case of Kiawah Island, their on resort office does not participate in our local MLS and therefore they literally “have” their own listings. Who’s to say whether this is good or bad, but all they are trying to do is corner the market on the properties on Kiawah. They want the sellers to think they are the only place you can find homes for sale so they use them vs an outside brokerage, but this hasn’t worked really. Locally here in Charleston SC, all the companies that are members of our local MLS also can and do sell, list, market homes for sale on Kiawah Island. Unfortunately, for us agents with buyers who want to purchase in Kiawah Island, that means we can only show and sell them the listings in our MLS because the agency within the gates of Kiawah is not permitted to do business with an outside brokerage.
6. THE MORE AGENTS WORKING AT A COMPANY THE BETTER
For the same reason as many above, this used to be relevant in the old days simply because sellers knew that if you had more agents in your company that it was a good chance their property would get seen more, garner more attention thus more interest and more push. But with the internet, all Realtors and companies have almost the same level of exposure, and the MLS gets a seller’s property out to the world so the number of agents in a company is irrelevant. Every house, condo, agent, broker, all have access to the same eyes on the internet. Assuming they know how to manipulate the web properly. The real estate companies with the most agents will try to have you believe there is some sort of benefit to having their company be the listing brokerage you should choose, but unless you’re doing a pocket listing it too matters not. Once your property goes on MLS everyone sees it is for sale. Since the advent of the internet, you’ve likely seen more “boutique” real estate companies, small teams, and groups where they focus on attention to service and detail because they are smaller.
7. BECAUSE AN AGENT HAS SOLD X AMOUNT OF HOMES THEY MUST BE BETTER
This can in some instances be the case, and conventional thinking would lead you to believe this to be a reasonable assumption, but honestly, it isn’t always the case. More times than not, the agents that sell ___X___ amount of properties more than another person is just the person who is more well connected or been doing it for a long time. This doesn’t necessarily mean they are a good or better choice or a smarter agent than another. I have seen many big producing agents out there that are, how do I say this.. idiots, and/or lazy. Another facet to this inaccurate perception is you may see one agent is responsible for hundreds of closings in one year. This is impossible. What you’re actually seeing is that one agent, has a team of people or a group within their office who sells property as well, but the one agent who is the team leader is the one who gets the credit for the sale. Thus, on the “back end”, it looks as if they’ve personally sold hundreds of properties when in all actuality their team members sold most of the properties, did all the work, facilitated the transaction, procured the buyer/seller etc.
8. BUYERS HAVE TO PAY FOR A REAL ESTATE AGENT
THIS IS NOT ACCURATE…. If you’re a buyer in South Carolina (I think most of the USA), you do not pay a buyer’s agent. The seller pays your agent to represent you and bring you to buy their house. You do not pay your buyer’s agent unless maybe your agent finds you a FSBO that you otherwise didn’t know about and your agent negotiates that contract for you. The seller has accounted for the cost of commissions into the sales price usually and their listing agent will split the commissions with your agent so you as a buyer do not pay for your agent. As far as I and my team are concerned, we do charge a buyer’s agency fee for small transactions, such as small lots, boat slips or fractional/interval ownership sales are concerned. This is because the commission on such small transactions isn’t worth the time, effort, and more importantly the liability.