Does the agent's company matter?

weedyacresOctober 22, 2012

Another question for you agents and other experts out there. When picking a listing agent, does it really matter who they work for? We're weeding through presentations, and of course everyone's telling us that one of the reasons we should pick them is because they work for the best company. Of course they all measure it differently. :-) But in particular, does size (of the company) matter?

I have to admit I'm skeptical. Isn't the MLS "the great equalizer?" Does the fact that one company has about half the listings (in one agent's words, they "control half the market") make it more likely that my home will sell if listed with an agent that works for them? None of the answers that they've given me in response to my question have been satisfactory. One said they show their company's listings first, which red-flagged her to me, as she's not working in her customer's best interest.

The only thing that seems "real" is that the larger company would have more agents come through on agent tour day than a smaller company. So awareness would be broader. Anything else?

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kirkhall

Who has the largest buyer pool? If there is a company in your area that effectively controls the buyer market (and in particular, YOUR buyer market--doctors, lawyers, etc), that is who you should go with, imo.

It doesn't matter how many they have listed. It matters how many buyers they have.

    Bookmark   October 22, 2012 at 2:44PM
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marie_ndcal

Not sure what you are really looking for as it appears you have sold/bought several time. Make a list what you want or don't want. Someplace on this forum there have been excellent list/questions/ideas from RE agents who do post here and do have some very valuable information. I hope these suggestions from these posters will help you out. But in the long run, it is your decision. Just get everything in writing.

    Bookmark   October 22, 2012 at 3:25PM
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sylviatexas1

I'm surprised to hear that an agent from one of the franchises would admit that they show preference to in-house listings;
bet their buyers don't realize that...

I don't know if a homeowner can access the info, but I once made a referral by checking the last 6 months of sales in a certain area & picking the agent who'd sold the greatest number of houses.

worked great.

    Bookmark   October 22, 2012 at 3:49PM
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camlan

You seem to be looking for some objective statistic that will determine the best possible agent. I'm not sure that's possible. Statistics can help, but they are not the be all and end all.

One question I'd be asking is how they plan to market the house and who they plan to market it too. That would say a lot about their knowledge of the market and their plans for your house.

When we had to sell my dad's 1880 Victorian, with kitchen and baths updated in the 1950's, and a lot of cosmetic wear and tear, but overall well-maintained, we went with the agent who had a clear-cut plan for the house. She had a list of people looking for older homes in our city and had contacts to find more lookers. The house went on the market in February, 2009, when the market was terrible in our area, and was under contract at the end of March. I think only 5 buyers came through, but at the end, there was a bidding war between three of them.

You want the agent who will bring interested buyers to the house, not just the agent with a lot of buyers. I've dumped agents who insisted on showing me houses listed by their agency that were nothing like the kind of house I wanted to buy.

Also talk to neighbors who've recently bought their homes. How did they like their agents? Because those agents clearly sold homes similar to yours.

    Bookmark   October 22, 2012 at 4:20PM
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brickeyee

"I'm surprised to hear that an agent from one of the franchises would admit that they show preference to in-house listings; "

Of course they do.

The broker cuts twice as much money, even if the two agents share.

The 6% can be split numerous ways, bit an old way was 3% listing broker, 3% selling broker.
The brokers than split 1% for themselves, 2% for the agent.

If an agent sold an 'in house' listing they might get another share from the broker since they now got 2% (1+1).

In many (maybe almost all) places sales agents MUST work for a broker.
The broker's test is much harder than the sales test.

    Bookmark   October 22, 2012 at 5:15PM
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weedyacres

kirkhall: What's the logic with that? I would understand if it was the old days when the different agencies kept their listing books. But with the MLS today, why would that be the case?

marie: Sorry if all my posts have you confused. We have sold one out-of-state rental FSBO, have another on the market, and have our primary residence on the market FSBO for a few months, looking to go listed with an agent. This question is about our primary residence. No shopping for houses until this one is on the market.

sylvia: A couple of the agents we've interviewed gave us the list ranking sales, so I've got that info. Most of the people we're talking to are top 20 out of 700 or so.

camlan: I'm definitely not looking for a single bullet. My main criterion is do I believe they can sell my house. I like the example you shared, and the agent that says "here's how we're going to get doctors and execs and golfers to look at your house" would definitely be head and shoulders above those rambling on about open houses and grocery store magazine ads. But there's lots of little stuff that I'm trying to determine whether it should be weighted in the decision. This is one of those things. If it comes down to 3 at the end, all from different agencies, it might be a tie-breaker.

    Bookmark   October 22, 2012 at 6:54PM
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ncrealestateguy

Brickeyee,
Sometimes your comments are so way off the mark. Why would I give the in house listings any more wieght than say... houses that actually meet my clients criteria? In fact, I would rather not deal with a coworker on the other end of the deal. It can make for bad blood. No brokerage I have ever worked for or ran into has a different commission split if you close a deal on an in house listing. And your example of the split between brokers and their agents can vary widely. Even different agents that are in the same office can have different splits. Anyhow...
Weedy, the MLS is the great equalizer when it comes to exposing your home. (assuming the data is smartly entered) But there are some smaller things that an agent can do to help it along. I send E - Flyers out to all 6000 agents every once a while, in case the listing may have been overlooked in the MLS. I won't list all of the other "fluff" marketing I do for my listings here, plus you have probably seen the list before. Don't get bogged down with the "fluff" IMO, you need to be asking these 3 questions to the agents:
1. Can you communicate well with the agent. (This is a huge one)
2. Do you feel like the agent will have your best interests in mind at all times?
3. Do you feel like you and the agent share common morals and values.
If after the interviews and answering these questions for yourself, you still have more than one agent that passes this test, then you can go the "fluff" for the tie breaker.I hope this makes sense.

    Bookmark   October 22, 2012 at 7:50PM
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ncrealestateguy

I just reread your original post and realized I did not address your question about a brokerage's size. IMO it does not. I have worked at Brokerages that had 150 agents and I now work at a Mom and Pop Brokerage with about 20 agents. The agents in this smaller firm are just as savvy, or more, than the agents in the larger firms. The agent's preference to work in a large firm vs. a small firm has nothing to do with selling your home. It is just their personal preference.

    Bookmark   October 22, 2012 at 8:09PM
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kirkhall

It is the case, imo, because the agents talk to each other. And, an agent in an office with lots of buyers will be able to talk up your place more effectively with another agent with a buyer they know about. But, they can't talk up your house encourage a showing with an agent they don't know about, or to a pair of buyers they don't know about. The MLS shows what you have, but it doesn't show what buyers are looking. If only there was a buyer equivalent to the seller MLS.
You are looking for a match-making agent. Sometimes it is helpful to "know" (of) both parties.

    Bookmark   October 22, 2012 at 11:16PM
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ncrealestateguy

My MLS does show me what agents have buyers that are looking at my listings. It is called reverse prospecting. Whenever an agent has a buyer on an automatic listing search set up for their buyer, I am alerted that this agents buyer just viewed my sellers listing. Once I am notified, I either email or call the agent to actively market the home.
Don't need to be in a big office to do that.

    Bookmark   October 23, 2012 at 7:02AM
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brickeyee

"Sometimes your comments are so way off the mark."

Your broker does not share part of the extra cut (or if you are a broker you get the extra cut)?

    Bookmark   October 23, 2012 at 12:00PM
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weedyacres

Yeah, I thought that reverse prospecting was pretty cool. One agent showed us the report for how many potential buyers were getting auto emails on houses in our zip code whose price range included $500K. There were 12 agents who had such buyers. I have to confess, that's targeted marketing that I can't do myself.

NC: I've seen your "big 3 questions" list many times, and agree that those are key. But I would put them at the end of the list, when it's winnowed down to those that pass the more critical ones of:
-do you have a good strategy to effectively market my specific house?
-do you understand the market and the numbers well enough and have the tenacity to effectively negotiate a deal when an offer comes in?
Anyone who passes muster on those "big 2" get put into the finals and we decide who we've got the best mind meld with.

    Bookmark   October 23, 2012 at 1:59PM
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sylviatexas1

Having been a real estate broker for over 25 years, yes, I do know that an agent must be sponsored by a broker;
I just don't know what sent you off on that tangent.

What I'm talking about is the broker/client relationship:

Brokerages that offer incentives to agents for selling in-house listings are doing their buyer clients a disservice,one that may violate the law of agency.

    Bookmark   October 23, 2012 at 2:46PM
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ncrealestateguy

Brickeyee,
I must not understand your point... what "extra cut" is the Broker In Charge getting if I sell one of his listings? I get my split for my buyer transaction and the listing agent would get her split for selling her listing, and the BIC would get his cut from that one too, just like he would if it got sold by an out of house agent. He is not netting any more or less because it was sold in house.
I also agree with Sylviatexas... I would not be surprised if offering incentives for in house sales may violate some regulation. Even if it does not, it just does not feel right to me.
Weedy, if you find an agent that has "YES" answers to those three questions, chances are they will deliver on your two major concerns.

    Bookmark   October 23, 2012 at 3:46PM
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brickeyee

Under the not uncommon 50% listing broker, 50 selling broker the single broker now gets the whole commission.

"Brokerages that offer incentives to agents for selling in-house listings are doing their buyer clients a disservice,one that may violate the law of agency. "

It has been done in numerous places for many years.

I would really doubt it.

Agent one lists, agent two sells.

Broker for both gets both selling and buying broker shares.

How the fees are split is not an agency issue.

    Bookmark   October 24, 2012 at 12:33PM
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sylviatexas1

Readers, an "agency issue" in this context means an issue involving the law of agency, which means that a real estate practitioner owes his/her duty, loyalty, & fealty to the client, not to the other party in the transaction & not to anybody else.

The brokerage cannot demand that an agent do anything that would violate the law of agency.

When an agency pays its agents a bonus or a higher commission split for selling an in-house listing, it encourages the "buyer's" agent to push his client to buy a property listed by his agency.

That is not representing the buyer, & that is an agency issue.

As an example:

A number of years ago, an agent for a franchise brokerage was working with a relocation buyer, a doctor from another state.
The doctor's list of requirements included a pool for his wife's physical therapy;
she had had polio & needed the pool to alleviate her post-polio syndrome.

The agent shows them a several houses in the desired area & the doctor buys one that is listed by another agent in the buyer's agent's office.

A few months later, the doctor is chatting with a neighbor & mentions that this house works so well because of the pool.

Neighbor says, "Why did you pick this one instead of the one on the next street over? It has an *indoor* pool, which would have been great for your wife; she could use it all winter."

The other house had all the requirements that were on the list & it had been available at the time the couple were looking, but their agent didn't show it to them.

The doctor calls the agent, & the agent says "oh, I didn't think you'd like that one."

It had been listed with a different brokerage.
The agent had gotten a higher commission for selling an in-house listing.

Suit was filed, the brokerage paid a hefty settlement, & I'd guess that everybody that doctor knows has heard about it.

    Bookmark   October 24, 2012 at 5:22PM
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brickeyee

"That is not representing the buyer, & that is an agency issue. "

It is a rel push to elevate a broker pushing in house listings to an agency issue.

This sounds more like someone phantasy problem than violation of any ethics rules.

    Bookmark   October 24, 2012 at 7:46PM
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yellowdog51

Thank you Ms. Sylvia. You always add to the discussion.

    Bookmark   October 24, 2012 at 10:17PM
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weedyacres

That doctor's experience is a good example of why, if you do use a buyer's agent, to not blindly rely on their suggestions, but to be a smart consumer and research yourself what's out there. Though I guess an agent who's trying to steer you away could always make up bad stuff about it to convince you it wasn't worth looking at at all.

    Bookmark   October 25, 2012 at 6:07AM
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ncrealestateguy

Brickeyee,
I see your point now regarding how a BIC would receive more if both agents came from his office. I was off on another tangent.
Even so, I would feel uncomfortable being associated with an office that made this commonplace... even if does not violate agency laws.

    Bookmark   October 25, 2012 at 8:03AM
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brickeyee

A broker with multiple sales agents (some in my area have 30-80 agents) IS going to have in house buy-sell occurrences.

The agents have committed no violation, they each representing their separate clients.

The broker is there to supervise the agents, not hold their hand on each sale.

    Bookmark   October 26, 2012 at 3:17PM
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sylviatexas1

The broker is there, among other reasons, to be sure that the agents do indeed represent their clients.

An agent who pushes his client to buy a house because his broker will pay him more for selling that house is not representing his client.

    Bookmark   October 26, 2012 at 4:02PM
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ncrealestateguy

Brickeyee,
And what most buyers and sellers do not realize, is that under this scenario, it is considered a Dual Agency transaction... All listings belong to the BIC.

    Bookmark   October 26, 2012 at 5:42PM
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JinaMotter

I dont think it matters that much. Its about work ethics. Homes are sold via another agent most times. Just be sure your agent knows what there doing.

When buyers look for a home they dont look at your listing company.

    Bookmark   October 27, 2012 at 1:19AM
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ncrealestateguy

Gina's got it!

    Bookmark   October 27, 2012 at 7:30AM
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loves2read

We interviewed two agents from different franchises--one farther away from our house...one was Coldwell Banker agent, one with Keller Williams...
in our particular neighborhood there did not seem to be any particular agency that had "cornered the market" now--although in the past I think that was more the case...
We went with the Keller Williams agent because she showed us a more detailed comparison of listings in our neighborhood, was going to use a professional photographer for the MLS photos, and was very up front about how she is our agent but they do try to have a buyer's agent in their office work any calls from the sign in the yard or the MLS listings that come to the office...and we have had probably a third of our showing come from that...plus the open house she held...

Re the doctor's story about an agent not showing a listing--
I don't understand anyone who would be buying in an (un)familiar area and NOT use the MLS to do their own research...Unless that house not shown was an exclusive listing and NOT available to MLS search--and some listings can be done that way--I find it difficult to believe that the doctor nor the wife were doing any research on possible homes...

when we were in the market for house about 6 yrs ago, we had an agent but I was the one who did all the research basically...I had email updates on several MLS sites and usually would go through new listings and winnow out what was interesting...since we were not under time constraint to buy I didn't want to waste her time...she was often the listing agent for area home builders and a couple of times we went to see homes in our price range that were her listings--but she did not push that and most of her listings were higher than our budget anyway...

We took over 3 yrs trying to decide what worked for us--and part of that time was waiting for a new subdivision to put in streets and get lots ready to sell when we thought we would buy in different area...I think I was as well-versed as any RE agent in the area about neighborhoods in our price range and what made a house a good buy...
I know that is not the case with most buyers though

The buyer's agent for the house we are selling is her mother--in her 70s--working part-time out of small RE office where the agents are similar to her...our agent said they mostly do work for friends, relatives...which works great maybe if you are buying but would not use them if I were selling...although she is also the listing agent for her daughter's duplex...

    Bookmark   October 27, 2012 at 11:33AM
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sylviatexas1

L2R, the doctor bought the house a number of years ago, may not have had access to info, or may have trusted his "buyer's" agent.

    Bookmark   October 27, 2012 at 11:47AM
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brickeyee

"All listings belong to the BIC."

That is going to depend on the minutia of the applicable state statutes and case law.

What if two brokers 'rent space' under the same brand name?

There are limits on how far dual agency extends.

    Bookmark   October 27, 2012 at 2:51PM
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ncrealestateguy

There can be only one Broker In Charge for each physical office.
I'm pretty sure that in this Country that if an in house sale occurs, it is considered Dual Agency.

    Bookmark   October 27, 2012 at 11:22PM
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LOTO

ncrealestateguy...In Missouri many offices practice Designated Agency and that eliminates Dual Agency for "In House" sales unless of course the Listing Agent is also the Selling Agent.

    Bookmark   November 2, 2012 at 7:58PM
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ncrealestateguy

LOTO... Same here in NC. But most sellers and buyers just go ahead and do dual agency.

    Bookmark   November 2, 2012 at 9:54PM
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brickeyee

"There can be only one Broker In Charge for each physical office. "

So two brokers cannot operate from the same office?
That does not sound correct.

That an agent can only work for one broker at a time is likely.

    Bookmark   November 3, 2012 at 1:06PM
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ncrealestateguy

I am pretty sure, but I need to check on that.

    Bookmark   November 3, 2012 at 3:41PM
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zone4newby

I think more than the company, I would look for an agent who has been selling precisely in your area for a long time. We had a realtor we liked a lot, but he was based primarily where we are headed instead of where we are selling, and while we got plenty of showings when we were with him, no one was ever serious (and some stuff has gone missing- sigh). We switched to an agent who is well known in our town, made a handful of small changes in decor, and lowered the price a little again, and the quality of buyers walking through the door went way way up.

We spent a year on the market with the other guy, and we had more than 40 showings and only one low-ball offer. Then we switched and immediately started getting second showings, and now (fingers crossed because we're not through all the contingencies) we've sold, in what is supposed to be a dead time of year.

I'm not entirely sure what the big difference was, but next time we sell, I will look primarily at the realtor's experience selling my kind of house in my area, and the realtor's reputation. Experienced realtors don't like working with new realtors, because they need to check up on the new realtor to make sure they're doing their part to get the deal to go through. At least in my area, this is not the kind of market where you want to go with the cheapest realtor.

Good luck!

    Bookmark   November 20, 2012 at 8:59AM
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