Orange County Realtor Information:
10 Essentials For Avoiding
A Bad Real Estate Agent
Orange County Realtors are easy enough to locate once you’ve decided to sell your home, just look across Southern California at any bus bench, your daily mail, or the internet and you’ll find tons of smiling real estate agents just waiting to take your listing. Trying to find one of these smiling faces that will actually “sell” your home and leave you more than satisfied is a completely different story.
It’s been our experience that most consumers simply do not know what questions to ask the Realtor that they’re considering hiring for the sale of their Orange County home. We’ve put together this consumer guide in hopes that it will increase consumer awareness among OC homeowners and ultimately help them to make better decisions. (This article was written with Orange County homeowners in mind but many of the principles could be applied nationwide.)
1. Inventory Report – An Agent’s Report Card
If performance and track record mean anything to you, make sure you ask each Realtor to bring a current copy of their MLS “inventory report” for the last 2 years so you can see for yourself how many homes they have actually gotten “sold!” This will also reveal exactly how many homes they have Active, In Escrow, Closed, Expired and so on. The inventory report is basically a report card that almost nobody ever asks for, but every agent could easily provide. The results are real, tangible, and will separate the top producers from the casual part timers and other poor performing real estate agents.
Imagine if at your work everybody had to walk around with "accurate" productivity reports hung from their necks each day. Maybe the blowhard down at the corner office or the slackers over at the water cooler might actually consider getting back to work. Maybe then the highly effective people might actually get the raise that’s long over due to them. In other words, this is Powerful Stuff!
2. References – Humans Who’ve Been In Your Shoes
Orange County Homeowners should not be afraid to ask for a list of references and then actually CALL THEM. Assuming the telephone numbers aren’t bogus, it would then be a great idea to ask some pertinent questions. Start by asking them how they feel about the prospective agent and whether they feel the money was well spent. More specific questions should be inquiries into: the property type, speed of sale, area of sale, memorable things the agent did, areas of improvement, and most importantly whether they would use them again.
One could dig as deep as they like, while trying to avoid crossing that thin line between what you need to know and what is really only their business. You don’t really need every detail because you will find a trend very quickly as to whether the experiences were positive or negative. This is all the information you’re really looking to obtain about your OC Realtor.
Again, Orange County real estate owners should not be afraid of both asking for references from agents and then calling them. Your boss surely did the same to you and it’s only fair that you treat this hiring decision with the same sense of responsibility.
3. Pricing your home - What You Want To Hear vs. What You Need To Hear
At some point, you’ll need to ask the Realtor to value your Orange County home as well as provide the numbers and methodology for how they came to that price. It’s a good idea to give a critical eye to the comparable properties they provide. Make sure they are actually Sold and aren’t just Pending Sale, or worse still, Active. Ensure that the closing dates are recent as well.
We’d recommend using comparables that are no more than 6 months old and even better would be less than 3 months. This of course all depends on how quickly the market is changing if at all. Have them give you a “move it quick” price, a “moderate speed” price, and a “hold out for top dollar” price.
Next, inquire as to how familiar the agent is with the comparable properties as well as the competitive properties that are Active on the market now. Have they seen them? How did they rate? Are they an apples-to-apples comparison? You don’t necessarily need them to be the “Neighborhood Realtor” in order for them to understand your market. Just make sure that they have done their homework before you price the property.
You’ll need to be very cautious of two things. One is using some online “Home Value” sources in estimating the price of your home. There are multiple reasons why their home sales information is often poor and for those with an inquisitive mind, it’s detailed here at Zillow Home Values – Do They Really Know What Your Home Is Worth? The bottom line is that there are way too many variables in the price of Orange County Homes for a computer program to provide any more than a rough ballpark estimate. And since the difference between accurate and ballpark can be 10’s of thousands of dollars or more, this is a risk we’re not willing to take.
The second thing to watch for is the real estate agent who tries to do what we refer to as "buying the listing." This is where they claim they can get an inflated price just to secure the listing. Usually, they will attempt to talk you down to a reasonable price later. And by later we mean AFTER they have your signature and a binding contract.
More often than not, the only reason the seller listed with this Realtor is because they said they could sell it for more money than the realistic agent. Unless there is cash involved, the house will only sell for a maximum of what it appraises at. Agents can help control foot traffic to your property, but not appraised value. Don’t be fooled.
By the way, if you think that an easy solution to this is just to have your agent find a cash buyer, think again. Rest assured that cash buyers do not overpay for OC real estate, which is why they’re cash buyers in the first place.
4. Game plan - You’re Planning To Fail Without One
Consumers should ask the agent for a detailed game plan for what they will do before, during, and after the sale as far as getting the home sold. The general rule once you have an attractive price is to have your agent focus on bringing the most amount of qualified traffic through the door as possible. This is where a strong marketing/advertising plan comes into play. Everything in the game plan should tie directly into getting the house sold. Our general litmus test for determining whether a marketing idea is good or not is the question “How will this directly and clearly help in finding a qualified buyer who wants to buy this house right now?”
Determining exactly what tools are good marketing versus what is just a gimmick is beyond the scope of what homeowners should look for. We just advise them to use common sense and think, “If we were looking for a home like the one I’m selling, would this really help us to find it?” Basically, if it smells like a gimmick, it’s probably a gimmick. Since many lackluster agents will readily admit that their marketing is done not to sell the home but to make the owner happy, we’d like to note the difference between that mentality and the mentality of a top producer with the following example
Purchasing a domain name such as www.123OakStreet.com is just another way of making the owner temporarily happy because there is no way this URL is going to drive any buyers to your house at 123 Oak Street. It may be cute, catchy, and all the rage (as it is currently) but unless work is done to drive web traffic there (and it’s usually not), it gets chalked up to the latest fad in a long line of techno gimmicks.
On the other hand, purchasing Premium Listing Membership on a top home search site, at a time when almost 90% of homebuyers are looking for homes online, is more along the lines of a good idea. A few of these sites are used heavily by home buyers and premium membership gives an agent not only the ability to add more pictures and better descriptions to their listings, but more importantly, it allows them to use their personal contact number as opposed to the general office number for interested parties. This enables the agent to use the next skill, which is probably the most underrated of them all.
5. Salesmanship – The Necessary Evil
Ask yourself "Is this person a salesperson" The answer should be a resounding YES! Seems simplistic, but you'd be surprised how many agents are embarrassed of their own sales profession, yet want to be hired to sell your property!
We can all be annoyed with salespeople, heck we annoy ourselves sometimes, but it’s one of the most important skills for an agent to possess with regards to the sale of your home. Are they going to readily admit that your home has a choppy layout or are they going to convince buyers how this type of floor plan is perfect for entertaining because there are so many wonderful areas for private discussions? See the distinction?
You’ll notice the difference when they first talk about themselves or their services. If they seem cut and dry and to the point like your accountant, this is probably not a good thing. If they work at building rapport with you while telling wonderfully charismatic stories about their experiences and have you agreeing with them, trusting them, and ultimately feeling like they’d have your vote for President…you may have found a winner!
You must excuse us for picking on accountants, as they have done nothing wrong. Our point is merely that as of late, there have been many newcomers to the Real Estate business in Orange County and some of them have no business here. Real Estate brokerage always has and always will continue to be a SALES job, even in Southern California! With Real Estate making headlines, many non-sales types have figured they’d drop their hat into this arena as well. The result is a whole host of people parading around under a mix of trendy titles, such as “Real Estate Consultants” and “Real Estate Advisors”, who couldn’t sell themselves out of a paper bag; let alone sell your home! You’d rather hire someone who can sell it, right?
6. Reputation - Community Cornerstone or Fly-By-Night?
It would be wise to ask for a history of their office/brokerage to get a feel for whether or not they are fly-by-night or a real cornerstone in the community. This may seem trivial but will be important if litigation rears its ugly head long after you've moved from the property.
Imagine yourself sitting at your new home enjoying a beautiful summer day when you get a phone call or open your mail to find a letter from an attorney claiming that you owe $100,000 to the person who bought your old house. Your slight uneasiness turns to panic when you call your old Realtor only to find out that their number has been disconnected. From panic, your mood transforms to sheer terror upon finding that XYZ Realty no longer exists!
While there is never any guarantee that a business will be around next year, you can do a little investigation on your own to minimize the risk. Ask the real estate agent what their 5-year plan is for the business and how they intend to get there. If the answer is weak, look elsewhere.
And speaking of looking elsewhere, it is a great idea to speak with the broker/owner since the listing will essentially belong to them. Should your Realtor quit, get sick, or have their license revoked in the middle of your listing, most of the time you will be stuck with the brokerage office regardless of whether or not your agent still works there.
And should there be future litigation, you had better hope that the Broker is still around. For this reason, you should ask them the same questions asked to the agent, plus a few more. Consider asking questions like whether they belong to any trade associations, community groups, or have any community members who will vouch for them. You’re just trying to get a read of their history and plans for the future. Ask them for the contact info and then CALL THEM to see what they say.
With that being said, the old boy on the block may not necessarily be your best choice either. If they haven’t adapted their plans and strategies to current markets and are unwilling to change from what worked yesterday, when there may be much more powerful options today, it will be best to keep shopping. A perfect example is illustrated by the power of the Internet. Many very seasoned and savvy agents are uncomfortable both with using and capitalizing on the power of this incredible resource. Even if you don’t understand online marketing and how it relates to home sales, you’d better have an agent who does because over 80% of Orange County homebuyers are using the tools available online.
7. Contract Knowledge & Communication – If they don’t know, who does?
Gone are the days of single page purchase agreements, handshake deals, and verbal commitments. These days, everything involved in Real Estate is done in writing. So it comes as no surprise that your Realtor not only should have a firm grasp on the entire purchase contract (and all related disclosures, addendums, and attachment) but also had better be able to communicate them effectively to you. If they don't seem crystal clear or don't communicate well, then there will be a very big problem down the road.
You don’t need them to teach you how to conduct Real Estate transactions but you do need to make sure they understand various details like contingencies, termite work, disclosure law and various other things. So right from the outset, ask them to sit down with you and explain the first couple pages or so of the purchase contract that a prospective buyer will be bringing you. This is usually all you’ll need to gauge both their communication & contract knowledge skills.
8. Buy Side - The Other Side Of The Coin
Unless you already have a new place to live solidified or are amidst a reverse 1031 exchange, you will need to find out what the Realtor can do for you on the buy side. What your looking for is: the number of properties they look at per week, the number they personally preview while you are at work, the length of time it usually takes them to find properties for their clients, the kind of methods they use to search, and whether they regularly list other properties that you may be interested in.
This critical skill is often overlooked leaving many consumers victims of the "list and ditch" syndrome. You’ll know you’re here when you feel as if you’ve been left to find a new place on your own. This is an all too common scenario among many agents who proudly refer to themselves as only “listing agents.” The term “listing agent” is a valid one in its legal use in that it depicts the agent hired by the owner to sell the house. The way many agents use it is really arrogant slang for “I don’t know how to and/or I don’t want to work with buyers.”
Besides just being financially idiotic, this type of mentality really is a disservice to their clients. We wonder how they can properly evaluate an offer if they never write them? Also, it seems like a good thing to have a full hand of buyers for your sellers so that you have some people to sell their house to immediately? We really don’t get it. They are in the brokerage business yet doing everything possible to avoid the actual brokerage of deals. Just stick with our questions above and the difference between an agent with a good plan to find you a new home and one with nothing will be clear in no time.
9. Negotiations Skills - Super Hero or Caveman?
Even if haggling is your full time career, there are many facets of Real Estate that require knowledge and skill of an industry trained professional. So how do you know if your guy/gal has what it takes? The answer probably lies where you least want to look.
That’s right, their commission! Do they have a standard commission structure or ask you what you’d like it to be? Do they flinch when you ask if it can be less or do they give in and basically beg for your business? Here’s the bottom line. If they can’t negotiate a good deal for their own paycheck, do you really expect them to have the sales skills that will successfully wrangle the sale of your real estate? Trust us, it’s never a good idea to hire the lowest bidding “professional negotiator!”
This is a tough one, we understand, but the reality is that agents must always be able to walk away from a deal. And for the talented superstar agents with a track record of proven results, walking away from a pay cut is really not that difficult. Combine this ability to walk with a solid plan to sell your home and you may be well on your way to finding the right person for the job.
10. Make A Decision – You’ve Done Your Homework So Have Confidence
The time has come to sit down and make a decision. Whether you interviewed 1, 3, or 20 different Realtors, everybody must ultimately throw caution to the wind and pick somebody. If you have trouble making tough decisions, use our guide here to build a table and score the agent(s) in all areas. Then tabulate the highest score to find the winner.
If we were to be pressed for the most important areas, we have to say sales skills, game plan, negotiation skills, and inventory report would be the top four; with references and communication skills a close fifth and sixth. If somebody is completely lacking in any category, they need to be cut.
So do your best in evaluating and then tell the lucky agent that you’re ready to sign the listing! For your convenience, our phone number is located at the bottom of this article. We look forward to selling your Orange County Real Estate!
About the Author:
Todd Foust is the chief marketing executive for the FOUST Team at C21 Discovery; one of the top-selling real estate teams in Southern California. He specializes in Orange and Los Angeles Counties and operates one of the area’s most informative real estate websites. To contact him or learn more about Orange County real estate, please visit www.FOUSTonline.com.
Home > Library > General Real Estate Info > Orange County Realtor Information: 10 Essentials For Avoiding A Bad Real Estate Agent
