Best Friend May Not Be the Best Agent

Family comes first and friends are precious--except when it comes to real estate.

Choosing a relative or a close acquaintance as your agent when you list your home for sale can be a big mistake, experts say.

The problem with hiring a family member or friend is that he or she may lack objectivity or may fear telling you the raw truth about your place, said Susan Marshall, who sells homes through Coldwell Banker Associates Realty in San Diego.

“What you really need is an impartial person who will keep his emotions out of the deal,” Marshall said.

She tells of a condo deal that “went sideways” because the owner hired his cousin as his listing agent.

The condo had long been occupied by a tenant. When the owner decided to sell, he promised his tenant that he would find an equivalent rental unit for him and subsidize his move if the tenant would leave the place before his lease expired.

Along came a single mother, with a young daughter in tow, who became enamored of the condo, which overlooked a large pool. She agreed to buy the place and obtained mortgage approval for its purchase.

Just days before the deal was to close, however, the tenant declared that he would not move because the condo owner hadn’t bothered to find another rental home for him.

The problem surfaced late in the process because the listing agent--the owner’s cousin--had been too fearful of asking the seller direct questions about the matter.

“He was intimidated because it was a family transaction. He didn’t want to strain his relationship with his cousin,” said Marshall, who represented the single mother in the transaction.

Not only did the snafu cause the condo sale to be canceled, but all those involved in the situation went away frustrated and sore.

“Everyone wasted a lot of time, and the tenant was irate,” Marshall said.

To be sure, not every deal involving a relative or friend is scotched. But even when such deals reach a successful conclusion, they can tarnish the relationship between the agent and his close associate.

In theory, a dear friend or relative would be the ideal person to list your home since he or she has your best interests at heart.

But this notion is a myth, said Darlene Schroeder of Prudential California Realty in Mission Viejo, who has sold homes for 20 years.

Here are three other myths about home selling:

Myth No. 1: An agent with lots of listings is always a superior agent.

Since the early 1990s, real estate agents have been hiring an increasing number of assistants as a way to broaden the reach of their businesses.

The concept is simple: The more help they have, the more clients they can handle.

Of course, delegation is a sound management principle. But real estate specialists say that some in their field are delegating too many of their basic functions.

And that could mean that the seller doesn’t always get expert help. “The only thing one agent has over another is the quality of his or her service,” Schroeder said.

There’s no reason personal assistants can’t handle routine paperwork, phone calls and errands. Many are capable of doing still more. But do you truly want a novice handling the sensitive final negotiations over the price of your home?

Probably not, Schroeder said. Chances are the agent you hired is the most effective person on the team to bargain on your behalf. And forthright bargaining may be vital to the best possible outcome.

“It’s nice to be a lamb, but sometimes you have to be a lion when you’re doing a transaction for your client,” she said.

In addition, you want your listing agent to personally “put out fires” during your transaction, said James M. Banger, a broker-associate for Century 21 Beachside in Whittier.

He recalled, for instance, how he once averted a crisis by intervening after a roofer--who was doing some pre-sale repairs--insulted the buyer-to-be. Had the agent not intervened to get an apology from the roofer, the deal could have died.

“When the buyer is upset, you have to handle that carefully,” Banger said.

Myth No. 2: A big moneymaker is always a good agent.

Every realty office has “top producers,” those who consistently lead their offices in commissions. Some are splendid agents who can manage many listings and still provide excellent service to everyone on their roster by working long hours with great zeal and efficiency, Banger says.

On the other hand, some top producers are merely playing “a direct mail game,” in Banger’s words. Rather than centering their business on referrals from satisfied clients, they swamp neighborhoods with advertising and build a customer base through the law of large numbers, he says.

To be sure, the U.S. Postal Service is a fine way to communicate with potential customers. But the occasional top producer falls short by spending virtually all his time on direct-mail campaigns, giving scant attention to the legitimate needs of current clients.

Myth No. 3: It’s always smart to hire a neighborhood agent.

Most home sellers are aware that agents are location specialists. Typically, an agent will focus on selling homes within a 10-mile radius of the agent’s base, said Schroeder, who “farms” the Scripps Ranch area of San Diego.

By selling within a defined piece of turf, an agent is better able to recommend the right price for a property, show the property quickly and work with local lenders.

Yet it’s not always wise to carry this “know-thy-turf” commandment to extremes. The agent who dominates your neighborhood enclave may not be the best possible choice within a 10-mile radius merely because she has the most signs up in your immediate neighborhood, cautioned Banger, of Century 21.

Distributed by Universal Press Syndicate.