I think the best way to kill the pre-listing and the pre-pre-listing strategy is to start educating consumers. At least where I work, we are in a pretty strong seller’s market. There isn’t any reason to put a “coming soon” sign in front of a home to build excitement.
Buyers are already excited about homes coming on the market that they might get the chance to buy — because there is so little for sale.
A seller’s market
Each week, when I look at the number of homes that are for sale in our market, I see a new low. It has been that way now since November. We have 50 percent fewer homes on the market than we would normally see this time of year.
Weekly home sales are about average, which is why I keep running out of homes to show my clients and why I am currently working with buyers more than sellers. Most of my listings are in the pending status, and I ran out of sold signs over the weekend.
Agents who have homes on the market that aren’t really on the market have a unique opportunity to make some extra money by getting both sides of the deal, and they look like heroes to their clients because they can have offers the day the home goes on the market.
As I recently wrote on my blog in an attempt to educate consumers, there is no pre-listing when we are in a seller’s market. Either a home is for sale, or it isn’t.
Just a plaything
Homesellers shouldn’t allow agents to turn their home into a plaything by offering it up for pre-listing. Sellers deserve better for the commission they will be paying.
When I go on listing appointments, I like to talk about how the pre-listing works so if the sellers decide to interview that one local team that pre-lists, they won’t be impressed by the strategy.
I don’t have to mention any names or say anything negative; I simply explain the concept of pre-listing and pre-pre-listing, how many buyers are looking for houses right now and how few are on the market.
Why would anyone want a “coming soon” sign in their front yard for all to see when they could have a for-sale sign or a sold sign? Homeowners either want to sell, or they don’t.
The common wisdom is that listings need as much exposure as possible, so some agents put the pre-listed home out on Zillow as a listing that is coming soon.
Again I say to consumers: do you want to sell your home or not? If the goal is to sell it, why are you letting your agent play with it and even advertise it? How will you, as the homeowner, benefit?
It isn’t hard to understand why real estate agents get a reputation for being a little slippery. I can picture these agents in back alleys flagging down pedestrians and saying, “Hey, I have a deal for you, look at my off-market, pre-listed house. How much will you give me for it?”
Pre-listed homes are also shared with other agents in Facebook groups, and they are shared through agent networks created mainly by company email lists inside of large real estate offices. I thought the whole purpose behind the MLS was broker reciprocity.
The clients’ best interest
In many states including my own, it is dual agency when the buyer’s agent and the seller’s agent are under the same broker. Those agents can not act on behalf of the buyer or seller — they have to act as facilitators.
Consumers need to understand that facilitation can happen because their home is being used as a plaything by a real estate office. I don’t believe that office has the best interest of the homeowner in mind.
When a homebuyer calls and tells me about this lovely home on 8th Street that is for sale, and I can’t find it on any of the websites or in the MLS, I get in my car and go look at the sign and call the number on it.
I’m told that there will be no showings until the home is on the market, and so I ask why the sign is in front of it. The only answers I ever get is that it is pre-listed or that they are trying to build excitement around the listing for the owner.
Homeowners need to understand that they can pay an agent from my company a commission and for that they will get fierce negotiation and no dual agency. Their home will be put in our MLS where the vast majority of the homes end up before they are sold.
It will also appear in the popular real estate portals, and it will get noticed because of the photography. We don’t pre-list.
Go ahead and pre-pre-list homes if you need to. When I put a home on the market, it will be for sale. I will create excitement with a for-sale sign and pictures of the home on the Internet all over the place. And I will continue to educate homeowners about the dangers of hidden listings and dual agency.
Teresa Boardman is a Realtor and broker/owner of Boardman Realty in St. Paul. She is also the founder of StPaulRealEstateBlog.com.
