This Mistake Cost Me Over $23,000 when
April 17, 2018
I Sold My Home.
Interested in selling your home but not sure which real estate agent to list with? Well, the answer should be pretty simple right? Just choose the agent that will sell for the highest price.
Not so fast. How do you know the agent you choose will actually sell your home for the price they promised? What happens if they can’t get buyers interested in your home at that price point and ask you to lower it?
My childhood friend Paul recently sold his home because he was offered a job in Denver, Colorado. Paul had grown up with me on Long Island and about 5 years ago, he purchased a home for $425,000.
Since Paul had to relocate, the first step in his home selling process was to reach out to a few local real estate agents to see how much they would list his home for.
The first agent Paul spoke to said his home was worth around $550,000 based on current market conditions. The second agent told Paul he could sell his home for $560,000 and the third agent promised $545,000.
Paul thought the decision was pretty straightforward, just pick the agent who offered to list at the highest price right? A week later, Paul’s home was on the market for $560,000.
About two weeks went by and Paul was getting nervous, the home didn’t seem to be getting any interest. His new job was starting in less than a month but he couldn’t move until his current home was sold. His agent called him up with disappointing news, “looks like the market has softened, I think we may need to drop the price.”
The agent recommended dropping the price by $10,000 to $550,000. The agent assured Paul that they will definitely get interest at this new price point so he followed his agent’s recommendation.
Another week went by and still nothing but one low-ball offer. Paul almost had a panic attack, he really didn’t know what he would do if his house didn’t sell. He got another call from the agent, again, asking to drop the price once more to $540,000. The agent assured Paul that there wouldn’t be any more price adjustments and told him that the home would sell quickly.
A few days later, they received an offer for $525,000. It was a bit low but Paul’s agent told him that if they didn’t take it, the listing might go stale and the home may not sell at all. After a bit of negotiation, Paul agreed to sell his house for $535,000…$25,000 less than the agent originally promised.
The moral of the story is that, as a home seller, traditional agents will tell you what you want to hear just to get you to list with them. They will promise a high price, but how do you know if they genuinely think your home will sell for that price? And if it doesn’t, why doesn’t the agent have any recourse for misleading you.
Traditional agents will say, “sure our incentives are aligned. I want to sell your home for the highest price because then I’d make a larger commission.” But, in reality, the agent just wants to get you to list with them and sell your home quickly, not for the highest price. In Paul’s case, it cost him over $23,000 but his agent only forwent an additional $375 in commission.
Felix was started because traditional brokers and agents are not acting in their clients’ best interest. Simply put, their incentives are misaligned.
At Felix, we believe in a better home selling experience. Listing your home with Felix has three distinct benefits:
We’ll pay you up to 2% of your home’s value for simply listing with us.
When your home sells, you’ll pay 0% in commission fees.
If Felix can’t sell your home in 90-days, we’ll buy it from you!