Most of the time, I'm in agreement with your columnist Robert Bruss on the advice in the Real Estate section. However, I must disagree with a point that he has repeatedly stated: only giving a broker 30-day listing agreements to sell a house. Bruss needs to consider what a broker or agent faces in the first 30 days of marketing a newly listed property.
Typically, an employment agreement (listing contract) is created between owner and agent. Within 24 to 48 hours, that information is submitted to the multiple listing service that serves the area. Most MLSs are computerized and within the next 24 hours, the information is accessible to all members in printout format.
Almost all MLSs publish an inventory book of their listed properties weekly. The deadline for publication is usually five days before the book is distributed. Conceivably, a new listing could appear in the new book anywhere from five days to 11 days after submission. We are now looking at between seven to 13 days before the new listing appears in published form from the day the contract was created.
While this is taking place, the agent is designing the marketing program for the property, i.e., broker caravans, ads, arranging photographs, brochure preparation and distribution, setting up open houses and much more. By the time a full marketing program is up and running on the property, 14 to 20 days may have gone by.
Under Bruss' concept of what sellers should do, the 30-day stipulation severely limits the agent's selling time to between 10 to 16 days. Clearly, not enough time for effective marketing and follow-up.
A lot of property we see needs repairs, painting and cleaning. Some require major work before marketing. Price is the most important aspect of selling a home and can be a giant obstacle in the agent's effort. The last thing an agent wants is an overpriced home that needs a lot of work and only 30 days in which to do it. Remember, an agent only gets paid when the home sells and the escrow closes.
If a seller adheres to Bruss' 30 day-limit, the effect would be a series of different signs appearing on their property every month. There would be no real opportunity for a marketing program to be implemented. The sellers may feel this is the best way to control their situation, but in reality, it is just the opposite. The use of this approach becomes a sword held over the agent's head and blunts motivation.
Market conditions are also a major component in the sale of homes today. Currently there are more homes for sale than at any time in the last 10 years. Buyers are scarce and very selective. It is a perfect time for buyers, and a nightmare for sellers.
We're constantly asked by our clients why we aren't showing their homes more or even at all. When the residential market was boiling over in 1988 and the first part of 1989, many homes sold within the first 30 days, several with multiple offers. Bruss' plan would have worked then, but not in every situation, I'm sure.
In my opinion, the absolute minimum working time an agent needs to market a home is 60 days under ideal conditions. Ninety days is a reasonable time, and anything longer would be for special circumstances.
A seller can include in the listing agreement specific performance requirements, i.e., number and placement of ads, open houses, brochures, etc. If the agent fails to meet these requirements, then there is grounds for cancellation. Almost all of our sellers understand the complexities and realities of selling their homes after we've explained it to them. They become a very valuable part of the marketing effort.
A. MORTELLARO JR.