Q: My husband and I have two properties in Michigan that we have listed with a real estate agent. She has had the properties listed for 4 months and we have not had a single showing or even an inquiry into them. She says that they are priced right, but there just aren’t any buyers for our properties. We would like to cancel the listing with her.
The listing agreement states that it can be canceled only if we and her company agree in writing. We gave notice in writing that we want to cancel the contract. The selling agent and her broker both said “No.”
I really can’t afford to have them listed with this agent or broker for another 8 months until the contract expires. Is there anything we can do to cancel the contract? I am in a financial bind and need to sell at least one of the properties ASAP and would like to list with another real estate company.
A: What makes you think that listing the property with another company will be any better? Are other homes in your area selling faster than yours? Are the prices for those homes similar to yours? Assuming you did the proper research about your current broker, you came to the conclusion that her company was the best company to sell your home.
Is she servicing the property correctly? Is the property listed in the multiple listing services in your area? Has she had open houses? Has she worked with you to determine what is selling and at what price in the neighborhood? Has she done what any other agent in your area would have done to get the homes sold?
If your agent is taking all the right steps to sell your home, you may not be able to cancel the agreement. You may want to have the agreement looked over by a real estate attorney in your area to see if there are any circumstances that may give you the right to terminate the agreement, But if not, you might have to ride it out.
You won’t like hearing this, but if you truly want to sell the home, you might need to reduce the price significantly. We guarantee that there is a price at which your property will sell, even in foreclosure-plagued Michigan.
You might also look at the properties that are selling and compare them to yours. To sell, yours will need to be in the best condition of all similar homes for sale and priced at the low end. Then, whatever buyers happen to be looking in your neighborhood will stop by your home.
You should have a sit-down with your agent and her managing broker to discuss what’s been happening with the listing, what marketing efforts (including advertising and open houses) have been made, and what else can be done to raise interest in the property. Perhaps it’s time to employ tactics such as offering a bonus to the buyer’s agent, or the buyers themselves.
If you’re truly unhappy and believe that this agent is the wrong agent for you and the property, you can ask the managing broker to find someone else in the office for you to work with. This might be better. Or, you can offer to reimburse the company for any out-of-pocket expenses they incurred on your behalf in exchange for canceling the listing for the property.
Whatever the brokerage firm has done wrong – and it may be that they’ve done everything right, but you’re in the toughest market in the country – you made a classic mistake. You should never sign a listing agreement for longer than 60 to 90 days. Or, if you have to sign a one-year agreement, make sure you have the right to terminate the listing after 60 or 90 days.
May 15, 2008.
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