All Forum Posts by: Irene Nash

Good staging is absolutely worth it, no matter what market you're in. Saying staging is only for slow markets is like saying you can 'get away with not doing it' in a hot market. Yes the home may sell fast even without staging if it's a hot market, but *good* staging (not crap, old fashioned staging or over-staging that hides the house and makes it look cluttered) always increases the market value, so why should we only strive for that in a slow market?

Case in point, I'm going to attach a before and after example from my real estate website, I would post the link to the page that contains all the other before and afters but pretty sure that is against terms of service. 

RE pricing, if you wait for offers (offer review date, unless that would be weird for your market area) then you give the market a chance to correct the price point if you list it too low. There's no way to tell from the price range of other homes if your proposed list price is at the property's actual market value.

Sample before and after below is the same room. Second photo was staged by me and my husband and professionally photographed. The difference is not just for people with no imagination, one photo clearly shows more value to online viewers and the same staging makes the property present far better (aka higher value) in person as well.

@Anthony Caiafa, two separate issues here, one is why the house is not selling and the other is what you have the right to do according to your listing agreement.

As far as the second issue, your listing agreement should specify exactly what happens if you terminate the listing. Here in WA state the original agent is owed a commission if you end up selling the house within 6 months to someone who first became aware of the property due to the original agent's advertising. (This is to prevent people from using a listing agent to market the home and then dumping them once the home has been well advertised.) However, if it can be shown that it was sold to someone other than that, no commission is owed.

In WA if the seller hires a second listing agent and it sells to someone who saw it through the first agent's advertising, they don't owe any extra commission. Technically they still owe the first agent their commission, but that amount is reduced by the amount they pay the second agent. So they don't pay twice, but it removes any incentive to use one agent for their marketing and then hire a discount agent as agent #2.

All the details for NJ should be in your contract. Most likely there's a set time frame for how long you may owe the first agent a commission. (If you fired him and sold the house 3 years later, hard to imagine you'd still owe a commission.) Read the contract carefully and don't rely on what they're telling you, seeing as it seems they may have left out some details in the conversation you had with them if they made it sound like you'd owe a commission regardless of circumstances (length of time since this listing, etc.)

As far as why it's not selling, if the photos are good and the description is correct and appealing, most likely the issue is price.

PS. Listing on Zillow and Realtor.com says it's been on for 18 days?

@Nick Camizzi It also depends on what state you're in. In WA state all agents are called 'real estate brokers' (a change they made a few years back, prior to that we were 'agents'), and the broker who runs the office is the 'designated broker'. But in most states I think it's as Nathan described.

@George Adkins Actually we have this business structure, started out as an LLC and waited way too long to be treated as an S Corp for tax purposes but finally did it - just wish we had done it sooner. We use a CPA who handles a lot of businesses including real estate agents, and before using this company we had S Corp status (LLC treated as S Corp for tax purposes) and did our taxes through another company, no problem.

The issue with the legal case mentioned above appears to be that the person involved, who had an LLC treated as an S Corp, signed a contract to provide services with a client and the contract was just between himself (the person) and his client. There was no mention of his LLC, which should have been the party contracting to perform the services and the entity getting paid. So when he tried to declare the income as LLC/S Corp income, the IRS said no, you were the one getting paid, not your corporation.

I'm not an attorney but this is my understanding of what happened. Definitely for RE I believe it's best to be an LLC vs. sole proprietor, as it sounds like you already know, and I'm being told now that the bar for when it makes sense to be treated as an S Corp for tax purposes is likely closer to $50K income, not well into the six figures, as many people will tell you. And that may not be right for everyone, so definitely check, obviously, but no sense in waiting longer than you have to. Good luck.

Hi Kevin, thank you for your service and congrats on looking into real estate as a career, it's an interesting profession that puts you in the path of all sorts of people and situations (I mean this in a good way :).

I have not looked into any graduate courses in real estate, but speaking from 20+ years of experience in real estate (and two college degrees in other stuff) I really think the best way to get into real estate is just to get into real estate. 

It's true that there's a lot to know and many agents enter the field not knowing things that are important, but I also don't think you're likely to get the right kind of instruction about those things in a college classroom. I could be wrong.

Can you find an opportunity to shadow an agent or somehow spend some time actually around agents who are working to get a feel for what skills and knowledge you'll need? 

RE is a weird field because you need to be competent, and you also need people to know you're competent. Which means you need to become skillful with marketing, in addition to learning a lot about how to actually do the work. It's easy to end up specializing in just one or the other of those two crucial skills. :)

I'm happy to answer any specific questions, and either way, good luck!

Exactly what @Bruce Lynn said, no one should be relying on anything automated when it comes to true market value. 

The databases often have inaccurate or outdated home information, and are not able to take into account value-heavy features such as floor plan, neighborhood, exterior appeal, interior flow, kitchen and master bedroom space, interior light, ceiling height, yard appeal, proximity to features that are positive or negative (park vs. apartment building/auto body shop), plus condo dues, amenities, and/or litigation status, along with many other things. 

Zestimates tend to change drastically as soon as a home is listed or closes, which is kind of a giveaway. 

What kind of office are you looking for, high touch with a lot of people in the office to reach out to for questions (during regular times), or more virtual (and obviously less expensive)?

In WA state at least, if an agent pays someone something as a result of a closing (i.e., when the 'something', whether it's money or a gift, is tied to the fact that the sale closed), the recipient needs to have a real estate license because it qualifies as a referral fee.

The advice I've gotten when I want to thank a client for referring another client to me (a box of chocolates is what I usually do, sounds simple but it goes over well) is to make sure I send it when I get the referral, not after the new client's deal has closed, so that it's clearly a thank you for the referral and not connected to the closing.

Probably in your state code of legislation for real estate agents this is addressed somewhere.

Typically the legal arrangement for the seller to pay the buyer's agent is contained in the listing agreement, which is the contract signed between the listing agent and the seller, and which does not exist here. 

If there is no listing agreement or any other arrangement by which the seller has agreed to pay a buyer's agent, there is no obligation that I know of for the seller to pay the buyer's agent. When I represent buyers on a FSBO I reach an agreement with the seller ahead of time that they will pay my commission out of their net proceeds and the buyer agent's fee is part of what's written into the offer - our MLS has a form for that. Sometimes that does not affect the contract price, however if it is appropriate based on market valuation to offer the seller list price then the buyers can increase the offer amount over list price by the amount of the commission so that the seller nets their original list price.

I hope this makes sense, and laws do vary by state, but here in WA the seller would not have to pay a commission based on the situation you described.

Whether or not the agent violated a code of ethics depends in part on how correct their advice to the buyer was, and whether or not they failed to adhere to any 'reasonable skill and care' requirement your state may or may not have, as we have in our Law of Buyer Agency. There's no benefit to the agent for them to write up a deal knowing the seller has no legal obligation to pay them, so the agent may just be misinformed and not understand there is a problem. And again, your state may have some kind of different regulations - but I don't see how a buyer's agent can force a seller to pay a commission just by writing up a contract, I'm pretty sure that is not a 'thing' anywhere.

Hi Kyle, 

I think how open agents are about things depends on the tradition of the regional market you're in, plus the individual agent. Here (NW WA) agents are usually pretty open, as long as they can do that and still act in the best interests of their client. Sometimes it serves the client best for the agent to be quite open about an offer situation, but it has to be OK with the client to do that.

If I were looking at a house like that my first question would be, "Is this house obviously overpriced", and would check the MLS for comps in the neighborhood (including homes that just went under contract, seeing as those reflect the most recent market conditions, and if DOM is low you know they went off probably near or at list price).

Also look at the aerial view and Google Street View if you haven't actually driven by to make sure there's not a commercial gravel pit in the back, it's not right next to a noisy mechanic's shop, etc - something that would be a no-brainer answer.

That way you've done your homework before calling the listing agent.

Then, here at least, it would be normal for me to call the agent and ask some questions about the home, including 'is there anything to know about the home that's not obvious from the listing remarks', and whether or not they've gotten any offers, and what kind of flexibility the agent thinks the seller may have on price (if price appears to be the issue). To the extent that it sounds normal, ask open-ended questions (what, how, why, when, etc.), not 'yes' or 'no' answer questions.

If there are only outside photos there may be tenants who make it difficult to access, or there could be other reasons affecting how the home is marketed. Or there may be some underlying problem with the house you'd notice once inside, i.e. cat pee smell, dank basement, etc. Or it could just be overpriced and scaring away buyers because of that.

The more you can find out ahead of time the better, and usually there's no harm in asking as long as you don't offend the agent or make yourself sound like a high maintenance buyer.