Home Selling in 91604>Question Details

Rafael, Home Buyer in Santa Monica, CA

Our real estate agent says he prefers to figure out what is the real price of the house even if that means a lower price. Why would he do that?

Asked by Rafael, Santa Monica, CA Sat Jul 24, 2010

Real estates are paid a percentage on a sale, right? I asked our real estate agent, and he said he didn't care about that, all he wants is to help us find the right house. Sherman Oaks and Studio City.

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Consider yourself fortunate that your agent wants to do what's right for you.

List price is a strategy --- some agents price properties artificially low in order to attract attention and hopefully stimulate multiple offers. Others price a little higher, anticipating that buyers will want to negotiate.

Your agent if studying the market....that's part of his service to you. Armed with the right information, he can provide guidance when you're ready to write your offer.

The care that he takes demonstrates his sincerity in helping you find the right house. And when you're happy with his service and your purchase, you will likely refer him to friends and associates, right? THAT's his ultimate reward. You as a source of referrals to come. And rest assured he will take very good care of them, too!

Good service is before, during and after the sale.
1 vote Thank Flag Link Wed Aug 4, 2010
Rafael -

Sounds like you have a good agent. Agents that work for long term relationships make sure they working for the best interest of the clients. The difference in commission in nothing compared to a trusted relationship.

CJ
1 vote Thank Flag Link Sat Jul 24, 2010
I agree with your agent.
The marker will always decide the price of your home. If you price it lower you will attract more buyers, which means more exposure and MORE OFFERS. When their are multiple offers on a property it gets buyers competitive and they will bid higher. One time I listed a condo for 300k and received no offers, we then lowered the price to 275,000 and the condo ended up selling for 305,000. Get the picture?
0 votes Thank Flag Link Mon Mar 3, 2014
In July of 2010, the real estate market in Sherman Oaks and Studio City was more of a buyer's market in general. Of course, certain homes properly marketed and negotiated by a great agent still brought top dollar during that time b/c they simply competed better through price, location, and condition.

It may be, due to the market that you were trying to buy a home in, your agent was attempting to gauge the "real price" for a given house in that market at that moment. That's tough to do because no agent can, with absolute certainty, figure out the real price of the house at that moment. The Investment Market Value (not Market Value) of the home to a particular buyer is what that particular buyer values it at and the true Market Value is almost always presented as a range of value on a specific house.

I've always advised my clients of the market value range I feel a particular property is worth based on a comparative market analysis of other similar properties in the neighborhood. I then advise the client that they have to decide what that specific home is worth to them. That decision cannot be made by me.
0 votes Thank Flag Link Sun Mar 2, 2014
Congratulations, Rafael. As others have already indicated, a good real estate agent is one who tries to help you find the best house with the best price FOR YOU, without regard for the potential commission s/he stands to earn. There are high ethical standards in our profession and, fortunately, most of my colleagues uphold those standards. We are in this "business" because we enjoy helping people. Sounds to me like you are working with someone who has your best interests in mind.
0 votes Thank Flag Link Wed Nov 10, 2010
Sounds like you have an agent who is working hard on getting you a good deal. The value of the home can be determined by a number of factors such as comparable sales, price per sq ft, lot size, location, condition of the home, but keep in mind most importantly a home is usually an emotional purchase. Its value is whatever the buyer is willing to pay for it. It can be priceless to one person and worthless to another. It it a very different buy from an income or investment property.
Good luck in your search and if you have any other questions please don't hesitate to contact me.

Yana Galuz
Senior Associate
Crescent Realty
yana@crescentrealtyla.com

12345 Ventura Blvd. Ste M
Studio City, CA 91604
(310) 595-5522 Direct
(818) 980-5040 Office
(818) 980-5020 Fax
0 votes Thank Flag Link Wed Nov 10, 2010
Sounds like you have an agent who is working hard on getting you a good deal. The value of the home can be determined by a number of factors such as comparable sales, price per sq ft, lot size, location, condition of the home, but keep in mind most importantly a home is usually an emotional purchase. Its value is whatever the buyer is willing to pay for it. It can be priceless to one person and worthless to another. It it a very different buy from an income or investment property.
Good luck in your search and if you have any other questions please don't hesitate to contact me.

Yana Galuz
Senior Associate
Crescent Realty
yana@crescentrealtyla.com

12345 Ventura Blvd. Ste M
Studio City, CA 91604
(310) 595-5522 Direct
(818) 980-5040 Office
(818) 980-5020 Fax
0 votes Thank Flag Link Wed Nov 10, 2010
Studio City and Sherman Oaks are beautiful places. I always enjoyed spending time on Ventura Blvd in that neighborhood. Great restaurants and opportunities to walk/run/bike.

Now your agent is probably trying to be helpful because there are still some overpriced properties out there. He should indeed be doing his homework to help you figure out the right offer. This is usually done through a comparable analysis, that is, a comparison of similar homes in terms of neighborhood and bedrooms, bathrooms, conditions, etc, which have sold in the last 6-12 months.

But in the end remember, it's your call, Rafael. Make sure you are comfortable with whatever offer you make in the end, and do your OWN research on price to develop your OWN opinion, or hire an appraiser (usually $300-$400) to develop an independent price opinion of the property you want. Remember the bank will do so when they figure out if they are going to give you a loan (assuming you are getting a mortgage loan) and you won't get a loan beyond the bank's parameters otherwise.
0 votes Thank Flag Link Fri Aug 6, 2010
Rafael - It sounds like you have a real estate agent who is more interested in finding you the best property to fit your particular situation, than in finding the highest priced home that works for you and you can afford to make the highest possible commission. Most agents actually work that way - if they are smart. An agent who finds you a property that you can love and that doesn't bust your budget, and who makes the experience as pleasant as possible, is an agent that wants you as a "client for life", and they want you to remember them and recommend them to your friends when they need to buy/sell. When you find a really great one, they should be "keepers".
Web Reference: http://pamelanelson.com
0 votes Thank Flag Link Fri Aug 6, 2010
Rafael, It sounds like you have a great agent! One who looks out for the best interests of his clients and wants
to help you make an informed decision and make a good investment. Good luck with your home search.
0 votes Thank Flag Link Thu Aug 5, 2010
Rafael I think this is great. You are blessed to have an agent who is out for your best interest and not his/her own. This is wonderful to hear. Kudos to your agent. This is what any self respecting agent would do for their client. I hope this makes you feel better. You have found the perverbial needle in the haystack. Best of luck.
0 votes Thank Flag Link Thu Aug 5, 2010
Hi Raphael,

There is no real 'price' until some one actally pays it. Even then it's possible that the actual price may not be in line with market value, which is just someone guess at a 'fair' price or price range. Your agent is just doing his job and trying to get a sense of what your type of home has actually been selling for vs. what he's been told by others.
0 votes Thank Flag Link Wed Aug 4, 2010
Rafael, sounds like you have a buyers agent who cares about you!! What a shock. I always do a c.m.a. on any house a buyer client wants to make an offer on. Why wouldn't I? The sellers can ask any amount they so choose. Numerous times a listing(sellers) agent can go into a listing presentation with a range cma where the sellers disagree with the facts of their neighborhood market values. IN other words, "their" house is worth more than anyone else's and they have convinced themselves. In this case the listing agent can: agree to set asking price too high, refuse to take a listing that is unreasonable on price or try to convince to seller that their perceived price is too high. So the asking price isn't always in line with the neighborhood sales. Therefore, as a buyer you need to know the facts on what is for sale in that neighborhood, what actually sold there recently, and which houses weren't successfully sold at what price. This is one of the reasons you as a buyer have a buyers agent to represent you! Good luck, and looks like you're off on the right start.
0 votes Thank Flag Link Sun Jul 25, 2010
Rafeal:

This a great question and one that I personally address in the first 5 minutes of my buyers consultation. For me personally, I tell my prospective buyers that my business and career decision is to build a referral business. In doing so, I tell my prospective buyers that although I get paid on a percentage of the sales price, I would prefer to get them the best deal possible so they will refer me to their co-workers, family, and friends. You wouldn't refer an agent if it comes to light that you paid $20,000 too much?

Ask your agent if it is a business decision? All the best
0 votes Thank Flag Link Sun Jul 25, 2010
Rafael,
There are many "Prices" that go onto a house.
Appraised Value - by an appraiser
Taxed Value - by your tax accessor
Market Value - a mixture of art and science

You want a true market value if you are the buyer or the seller. A buyer does not want to overpay for a property and a seller is getting nowhere fast if they overvalue the property and put it on the market for too much and in some cases too little.

Market value changes just like the stock market or financial markets. It is a snapshot in time. It is established by sold properties that are similar within a mile of the subject property.

I hope you see that price and value are two different terms.

Debbie Albert, PA
Coldwell Banker Residential
Web Reference: http://www.ronanddebbie.net
0 votes Thank Flag Link Sun Jul 25, 2010
Many buyer's agents get the satisfaction of finding the buyer a home at a great price. Our business is based on referrals and repeat customers. We enjoy the negotiations as much as showing homes.There are some agents who do not have patience and some may not know the market . But you seem to have a good agent.
Web Reference: http://www.gitabantwal.com
0 votes Thank Flag Link Sun Jul 25, 2010
"The real price" is whatever a willing buyer and seller agree it is. As a buyers agent, I see my job as getting to the lowest price a seller will sell the house for. As a listing agent, I see my job as setting the list price to attract a buyer at the highest possible price.
Putting the clients needs above our own is the way it's supposed to work.
0 votes Thank Flag Link Sat Jul 24, 2010
Hello Rafael,

Your agent is being honest. If it's a new listing and it's priced right chances are they will want you to pay the list price but it is their job to negotiate a fair deal for you. It's up to you what you offer but an experienced agent will always want to advise you on what your offer should be.

Best,

Monique Carrabba
The Carrabba Group
Keller Williams Hollywood Hills
(323) 899-2900
mcarrabba@kw.com
0 votes Thank Flag Link Sat Jul 24, 2010
Hi Rafael,

This agent you're working with will wind up finding you a home you're happy with, right? Then, after you move in, you'll be telling every person you meet about the 'best agent' in Santa Monica. You'll wind up giving your agent's name to 50 or 100 people over the next 5 years. A happy customer is like having a billboard up on
i-95!

This is how smart agents run their business!

Scott Miller, Realty Associates, Boca Raton, FL
0 votes Thank Flag Link Sat Jul 24, 2010
Agreed Rafael. Keep your agent.
0 votes Thank Flag Link Sat Jul 24, 2010
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