Latest / Dishin' Dirt with Gary Pickren / Dumb $#!% Real Estate Agents Say — Part 2

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Dumb $#!% Real Estate Agents Say — Part 2 · Dishin' Dirt with Gary Pickren

• 0:00
  SPEAKER_01: Today, I am going to do part two of one of my very favorite episodes of Dish and Dirt Ever.
• 0:05
  SPEAKER_01: It's the dumb shizat that real estate agents say.
• 0:09
  SPEAKER_01: And before somebody gets offended, and believe me, somebody's going to get offended because we take personal pride in being offended these days, understand what I'm talking about.
• 0:17
  SPEAKER_01: I am not saying that real estate agents are dumb.
• 0:19
  SPEAKER_01: I work with thousands of real estate agents every year.
• 0:22
  SPEAKER_01: I train real estate agents every year.
• 0:25
  SPEAKER_01: I see them at the real estate commission.
• 0:26
  SPEAKER_01: Some of the smartest people I know in business are, in fact, real estate agents.
• 0:30
  SPEAKER_01: They're small business people who created their own small business and have been very successful in them.
• 0:35
  SPEAKER_01: But very smart people do say very dumb things from time to time.
• 0:39
  SPEAKER_01: Lawyers say a lot of dumb things.
• 0:41
  SPEAKER_01: Lenders say a lot of dumb things.
• 0:43
  SPEAKER_01: And real estate agents aren't immune to saying dumb stuff either.
• 0:47
  SPEAKER_01: And real estate agents sometimes say things with such absolute certainty that everybody else in the real estate transaction assume that it has to be true.
• 0:54
  SPEAKER_01: That's what makes some of these statements so dangerous.
• 0:57
  SPEAKER_01: It's not, I think this may be true.
• 0:59
  SPEAKER_01: It's this is the rule.
• 1:01
  SPEAKER_01: And when you challenge them on it and say, well, where'd you get that?
• 1:03
  SPEAKER_01: Well, another agent told me that or I was taught that.
• 1:05
  SPEAKER_01: Well, when was that?
• 1:06
  SPEAKER_01: Back in 2009.
• 1:07
  SPEAKER_01: Well, that's wonderful, but do you think real estate might have changed since 2009?
• 1:12
  SPEAKER_01: Maybe it's changed a lot in the last two years since Sitzer Burnett and AI.
• 1:16
  SPEAKER_01: But now we have agents out there repeating the same thing for the last 17 years that was never right in the first place, and it's even more wrong even today.
• 1:24
  SPEAKER_01: So today I've got 10 more things that I hear real estate agents say all the time that either aren't true, aren't necessarily true, are terrible advice, or get a real estate agent in trouble.
• 1:35
  SPEAKER_01: Some of these are pretty funny, some of these are serious, and several of them are becoming even more important today because of what is happening in real estate right now.
• 1:42
  SPEAKER_01: So we're going to examine that and a whole lot more on this episode of Dish and Dirt.
• 1:47
  SPEAKER_00: This is Dish and Dirt with Gary Pickren, South Carolina's only podcast dedicated to the real estate agent craft.
• 1:55
  SPEAKER_00: And now the host of Dish and Dirt.
• 1:59
  SPEAKER_01: I'm your often opinionated, but rarely wrong host, Gary Pickering, coming in from the beautiful downtown Columbia South Carolina offices of Blair Cato Pickering Catchline this, the second week of October, 2026.
• 2:10
  SPEAKER_01: So let's roll right into dumb shit that real estate agents say, part two.
• 2:16
  SPEAKER_01: And I'm going to start with one of my absolute pet peeves.
• 2:18
  SPEAKER_01: And I think this is one of the dumbest things in real estate right now, and a lot of real estate agents think it's the greatest thing going as if they just figured it out, and no one had ever tried this before.
• 2:28
  SPEAKER_01: I continue to be absolutely fascinated with this phrase.
• 2:32
  SPEAKER_01: Coming soon.
• 2:33
  SPEAKER_01: What exactly does coming soon mean?
• 2:37
  SPEAKER_01: Coming soon to what?
• 2:39
  SPEAKER_01: To the market?
• 2:40
  SPEAKER_01: Coming soon to the MLS?
• 2:42
  SPEAKER_01: Coming soon to the public?
• 2:43
  SPEAKER_01: Coming soon to some buyers, but not others?
• 2:46
  SPEAKER_01: Because here's what is happening.
• 2:49
  SPEAKER_01: An agent gets a listing, they put a coming soon out in the yard, or they put it on social media's coming soon.
• 2:55
  SPEAKER_01: They might even send something around the office.
• 2:57
  SPEAKER_01: Maybe they tell their favorite agents about it.
• 3:00
  SPEAKER_01: So pretty much everybody knows the house is going to be for sale.
• 3:03
  SPEAKER_01: But then somebody calls and says, I have a buyer who wants to see it.
• 3:07
  SPEAKER_01: And the responses vary.
• 3:09
  SPEAKER_01: But oftentimes it's, I'm sorry, we're not showing it yet.
• 3:13
  SPEAKER_01: It's coming soon.
• 3:14
  SPEAKER_01: Now that would be okay because that would be at least consistent.
• 3:18
  SPEAKER_01: We have a house, I have a signed listing, it's going to be for sale.
• 3:21
  SPEAKER_01: We're doing some things to the house, so we're not doing showings right now.
• 3:25
  SPEAKER_01: It's truly coming soon.
• 3:27
  SPEAKER_01: But that's not what we see in the market most of the time right now.
• 3:31
  SPEAKER_01: What you'll find is that somebody else has already seen this house.
• 3:36
  SPEAKER_01: Now, wait a minute.
• 3:37
  SPEAKER_01: I thought nobody could see the house.
• 3:40
  SPEAKER_01: But the agent will say, well, that buyer is working with somebody in our office.
• 3:44
  SPEAKER_01: That's interesting.
• 3:45
  SPEAKER_01: Or that was somebody that the seller knew, or that buyer contacted me directly, or I know their agent really well and they asked to see it.
• 3:53
  SPEAKER_01: Because now we have a huge problem.
• 3:55
  SPEAKER_01: Because coming soon cannot mean coming soon for you, but available right now for the people that I choose.
• 4:03
  SPEAKER_01: And let's start with something fundamental in South Carolina.
• 4:06
  SPEAKER_01: If you're marketing somebody else's real estate, you need to have authority to market it.
• 4:11
  SPEAKER_01: That means you have to have an agency agreement signed, a signed listing agreement.
• 4:16
  SPEAKER_01: Putting coming soon on a house isn't some magical period before real estate law applies.
• 4:23
  SPEAKER_01: You're advertising real estate, you're marketing the property.
• 4:26
  SPEAKER_01: So when you tell somebody, Gary, it's not really listed yet, it's just coming soon, what does that really mean?
• 4:33
  SPEAKER_01: If you don't have a listing agreement, then why are you marketing somebody else's property?
• 4:37
  SPEAKER_01: And if you do have a listing agreement, then we need to talk about what you're doing with that listing.
• 4:42
  SPEAKER_01: Why are certain buyers being given access to the property based on their friendship with you or they work in the same office for you or some other unknown criteria why other buyers are not being allowed and their agents aren't being allowed either?
• 4:58
  SPEAKER_01: What objective does this actually accomplish for your seller?
• 5:02
  SPEAKER_01: How about your fiduciary duty to the seller?
• 5:05
  SPEAKER_01: How are you explaining who you're letting see the house and who you don't let see the house?
• 5:10
  SPEAKER_01: Because remember who the listing agent is actually representing, not the brokerage, the seller.
• 5:16
  SPEAKER_01: Your job isn't to create an advantage for your brokerage.
• 5:19
  SPEAKER_01: Your job isn't to create an advantage for one of your buyers.
• 5:22
  SPEAKER_01: Your job isn't to create an opportunity for dual agency.
• 5:25
  SPEAKER_01: Your job is to represent the seller's best interest.
• 5:29
  SPEAKER_01: That is your fiduciary duty.
• 5:31
  SPEAKER_01: And once you start selectively determining which buyers get access to the property and which ones don't, you've opened up a whole new set of questions.
• 5:40
  SPEAKER_01: Why those buyers?
• 5:41
  SPEAKER_01: Why not these buyers?
• 5:43
  SPEAKER_01: What criteria did you use?
• 5:44
  SPEAKER_01: Was the seller fully informed?
• 5:47
  SPEAKER_01: Was this actually the seller's decision?
• 5:50
  SPEAKER_01: Does it increase or decrease competition?
• 5:52
  SPEAKER_01: Does it increase or decrease exposure?
• 5:54
  SPEAKER_01: And potentially, depending on how this is being done, what are those fair housing complications?
• 5:59
  SPEAKER_01: That's why I have said it repeatedly.
• 6:01
  SPEAKER_01: Coming soon should describe timing.
• 6:04
  SPEAKER_01: It shouldn't describe which buyers you like and which buyers you're going to let have access to this house.
• 6:09
  SPEAKER_01: If the house isn't ready to be shown until Friday, fine.
• 6:13
  SPEAKER_01: Then nobody sees the house until Friday.
• 6:16
  SPEAKER_01: But if you're showing it Tuesday to certain people in your office or certain agents you like, then don't tell me it isn't available to be shown.
• 6:24
  SPEAKER_01: Because apparently it is.
• 6:26
  SPEAKER_01: It's just not to everybody.
• 6:27
  SPEAKER_01: It's just not the people you aren't in business with.
• 6:29
  SPEAKER_01: And that's an entirely different conversation because unfortunately, I know for a fact that there's a large percentage of these coming soons have nothing to do with more than selecting people who get to see the house.
• 6:40
  SPEAKER_01: Good luck explaining how that complies with your statutory duties before the real estate commission.
• 6:45
  SPEAKER_01: Good luck explaining how there were no unintentional consequences in fair housing at the Fair Housing Commission.
• 6:51
  SPEAKER_01: And good luck explaining how that was in compliance with your fiduciary duty to your client in front of a judge or in front of a jury.
• 6:57
  SPEAKER_01: Because remember, clear cooperation came out of a major lawsuit in California for these exact same reasons.
• 7:05
  SPEAKER_01: The exact same thing that is happening today with coming soons already has been tried in California and resulted in a very bad verdict.
• 7:14
  SPEAKER_01: That is why we have clear cooperation.
• 7:16
  SPEAKER_01: But today, some of us foolishly think that that lawsuit could never happen again, and it certainly wouldn't happen in South Carolina.
• 7:22
  SPEAKER_01: Number two, the second stupidest thing I hear is I can't sell your house unless you guarantee buyer agent compensation.
• 7:30
  SPEAKER_01: And I've heard variations of this one ever since the NAR settlement.
• 7:33
  SPEAKER_01: Listing agent tells the seller you really need to offer buyer agent compensation.
• 7:38
  SPEAKER_01: That's fine.
• 7:38
  SPEAKER_01: That's advice.
• 7:40
  SPEAKER_01: Maybe there's good reasons for that advice.
• 7:42
  SPEAKER_01: But sometimes that's morphing into you have to offer buyer compensation, or I can't sell this house unless you agree to pay the buyer's agent.
• 7:52
  SPEAKER_01: Whoa.
• 7:53
  SPEAKER_01: Those are two different statements.
• 7:55
  SPEAKER_01: One is professional advice, the other is presenting something as a requirement.
• 7:59
  SPEAKER_01: And I think agents need to become incredibly disciplined about understanding the difference.
• 8:04
  SPEAKER_01: Your job is to educate the client.
• 8:07
  SPEAKER_01: Explain the options, explain what might happen.
• 8:11
  SPEAKER_01: You might even be able to say if you don't offer compensation, a buyer who has agreed to pay their agent may ask you for it in the offer.
• 8:17
  SPEAKER_01: That's perfectly reasonable.
• 8:19
  SPEAKER_01: You might explain that some buyers have limited cash and may need to negotiate compensation as part of the transaction.
• 8:24
  SPEAKER_01: That is also fine.
• 8:25
  SPEAKER_01: Or you might need to recommend a particular strategy based on your own experience.
• 8:29
  SPEAKER_01: That is your job.
• 8:30
  SPEAKER_01: But the seller gets to make the decision.
• 8:32
  SPEAKER_01: And there's something I want agents to think about beyond compensation.
• 8:35
  SPEAKER_01: And this is a huge difference between saying I recommend and saying you have to.
• 8:40
  SPEAKER_01: Every time the words you have to come out of your mouth, you better know why.
• 8:44
  SPEAKER_01: Is it required by law?
• 8:45
  SPEAKER_01: Is it required by the contract?
• 8:47
  SPEAKER_01: Is it required by the brokerage agreement?
• 8:48
  SPEAKER_01: Was it required by the lender?
• 8:50
  SPEAKER_01: Or is it just simply something you want them to do?
• 8:53
  SPEAKER_01: Because those aren't interchangeable.
• 8:55
  SPEAKER_01: And frankly, one of the lessons over the past several years should be that we need more transparency around compensation, not less.
• 9:03
  SPEAKER_01: Explain what you're charging, explain what the buyer agent is charging, explain the seller options, and explain exactly how compensation might become part of the offer.
• 9:13
  SPEAKER_01: And then let your client make an informed decision.
• 9:15
  SPEAKER_01: That's agency.
• 9:16
  SPEAKER_01: I wish this was a non-issue, and it should be a non-issue after Sister Burnett, but agents and consumers alike tell me that agents, particularly in Hilton Head, calling you out again, are telling sellers, I can't sell your house unless you guarantee broker-to-broker compensation for the buyer agent.
• 9:32
  SPEAKER_01: Buyer agents won't show your house unless you do broker-to-broker compensation.
• 9:37
  SPEAKER_01: I think that's more about a lazy listing agent than it says about a buyer's agent because I think a buyer's agent will show the house because the buyer agent wants to get a house under contract.
• 9:46
  SPEAKER_01: I think it's also a terrible indictment of your marketplace.
• 9:49
  SPEAKER_01: So you might not want to say that because it's indicting all real estate agents in Hilton Head and not just yourself.
• 9:55
  SPEAKER_01: Number three, our standard commission is blank.
• 9:58
  SPEAKER_01: Every time I hear this phrase, I cringe a little bit.
• 10:01
  SPEAKER_01: Actually, I feel like I die inside a little bit.
• 10:03
  SPEAKER_01: Our standard commission is 6% or our market charges 3%.
• 10:07
  SPEAKER_01: Everybody around here charges blank.
• 10:09
  SPEAKER_01: Stop that.
• 10:10
  SPEAKER_01: Stop that.
• 10:11
  SPEAKER_01: Who is the hour in that phrase?
• 10:14
  SPEAKER_01: Is it your brokerage?
• 10:15
  SPEAKER_01: If your brokerage has established a fee for particular services, say our broker charges X for these services.
• 10:21
  SPEAKER_01: That is a completely different statement than saying our, because our means everybody in real estate.
• 10:26
  SPEAKER_01: And we have a problem.
• 10:28
  SPEAKER_01: There isn't an industry-wide standard commission.
• 10:31
  SPEAKER_01: It cannot be one.
• 10:32
  SPEAKER_01: That would be in violation of the settlement, it would be in violation of the law.
• 10:35
  SPEAKER_01: There's not an MLS commission.
• 10:36
  SPEAKER_01: And there certainly is not a realtor commission.
• 10:39
  SPEAKER_01: And after everything this industry has gone through with antitrust litigation and Sister Burnett case, why are we still using language that makes compensation sound collectively established?
• 10:50
  SPEAKER_01: And here's the thing: you don't need that language.
• 10:53
  SPEAKER_01: If you charge 3%, 4%, 5%, whatever, own it.
• 10:57
  SPEAKER_01: Explain your value.
• 10:58
  SPEAKER_01: My fee is blank percent, and here's what I do for that fee.
• 11:02
  SPEAKER_01: It's great.
• 11:02
  SPEAKER_01: That's business.
• 11:03
  SPEAKER_01: If another brokerage charges something different, that's their business.
• 11:07
  SPEAKER_01: If another agent has a different business model, fine.
• 11:09
  SPEAKER_01: Compete against them.
• 11:11
  SPEAKER_01: That's exactly what is supposed to happen.
• 11:13
  SPEAKER_01: But when somebody asks, what do agents normally charge?
• 11:17
  SPEAKER_01: Be very careful about turning your personal fee into something more market wide standard.
• 11:23
  SPEAKER_01: Because there's an enormous difference between this is what I charge and this is what everybody in the market charges.
• 11:30
  SPEAKER_01: When is a business decision?
• 11:32
  SPEAKER_01: One starts to sound a whole lot like price coordination, which is antitrust.
• 11:36
  SPEAKER_01: So let's retire that phrase standard commission, set commission, sell your services, sell your expertise, sell your value, state your price.
• 11:45
  SPEAKER_01: That simple.
• 11:46
  SPEAKER_01: Do not be ashamed of your fee.
• 11:49
  SPEAKER_01: Number four, we didn't really terminate because we didn't send the termination fee.
• 11:54
  SPEAKER_01: Now, this one actually came up recently and it demonstrates something that somewhat drives lawyers crazy.
• 11:59
  SPEAKER_01: People read half of the contractual requirement and then they stop.
• 12:02
  SPEAKER_01: Under South Carolina Realtors contract, you've got a due diligence provision.
• 12:07
  SPEAKER_01: And if you're going to exercise the contractual right to terminate, you have to comply with what the contract actually requires to exercise that right.
• 12:15
  SPEAKER_01: So imagine this in the state contract, it says the deadline is 6 p.m.
• 12:19
  SPEAKER_01: At 5 45, the buyer's agent sends a termination notice.
• 12:23
  SPEAKER_01: So done, right?
• 12:24
  SPEAKER_01: We've terminated.
• 12:24
  SPEAKER_01: Except there's another requirement associated with exercising the right to terminate.
• 12:28
  SPEAKER_01: That's most likely in the state contract, the termination fee.
• 12:32
  SPEAKER_01: In CCRA's contract, we don't have that.
• 12:34
  SPEAKER_01: And I don't think they have that in the Hilton Head contract.
• 12:36
  SPEAKER_01: But that didn't get delivered in this case.
• 12:38
  SPEAKER_01: So the argument becomes well, we sent the termination notice, which was great.
• 12:42
  SPEAKER_01: We did one of the things required to terminate.
• 12:45
  SPEAKER_01: But if the contract requires both A and B, doing A is not the same thing as doing A and B.
• 12:51
  SPEAKER_01: Imagine having an option contract.
• 12:53
  SPEAKER_01: I exercise my option.
• 12:54
  SPEAKER_01: Well, did you pay the option money?
• 12:56
  SPEAKER_01: No.
• 12:56
  SPEAKER_01: Then you didn't properly exercise your option.
• 12:58
  SPEAKER_01: Contracts matter, guys.
• 13:00
  SPEAKER_01: Words matter, definitions matter.
• 13:02
  SPEAKER_01: And agents get themselves into trouble when they start treating contractual requirements as administrative technicalities.
• 13:08
  SPEAKER_01: They're not technicalities, they are party agreements.
• 13:11
  SPEAKER_01: And here's the practical lesson.
• 13:13
  SPEAKER_01: Two problems that could be created in this situation.
• 13:15
  SPEAKER_01: One, you did not properly terminate, so now you have no protections under the contract for your termination.
• 13:23
  SPEAKER_01: The buyer would now be in default and would now possibly forfeit the earnest money or be liable for damages.
• 13:30
  SPEAKER_01: The second part, your buyer can't say, Well, I really didn't terminate, I still want to move forward because you can't somewhat terminate.
• 13:37
  SPEAKER_01: Once you provide the notice as the buyer of your intent not to complete the transaction, then the contract is terminated.
• 13:44
  SPEAKER_01: There is no magical document you need to terminate.
• 13:46
  SPEAKER_01: Once you tell me you're not moving forward, we're terminated.
• 13:49
  SPEAKER_01: But if you're not sending the document and you're not sending the termination fee, now you have a problem because you're in default of the contract.
• 13:56
  SPEAKER_01: And so any protection you might have had under this contract in terms of your right to get back earnest money or other rights therefore could be problematic for you.
• 14:04
  SPEAKER_01: And the seller has the automatic right at this point to go ahead and relist the property because you told them of your intention not to move forward with the contract.
• 14:11
  SPEAKER_01: But because you're not terminating properly, you have no longer the protections under the contracts as if you had terminated it properly, which could be the return of the earnest money.
• 14:21
  SPEAKER_01: Number five, don't send me that inspection report because I don't want to know.
• 14:25
  SPEAKER_01: And this one cracks me up because what you're really saying is I've developed this really sophisticated risk management system is called intentional ignorance.
• 14:34
  SPEAKER_01: Buyer gets an inspection, buyer discovers a problem, buyer terminates, and the listing agent says, whatever you do, do not send me that report because I don't want to know what's wrong with the house because I don't want to have to disclose it later.
• 14:45
  SPEAKER_01: Okay, but what if you already know?
• 14:48
  SPEAKER_01: What if the buyer told you?
• 14:50
  SPEAKER_01: What if the buyer's agent told you?
• 14:51
  SPEAKER_01: What if the termination communications identifies that issue?
• 14:54
  SPEAKER_01: What if the seller knows?
• 14:56
  SPEAKER_01: What if somebody says a structural engineer said the foundation is failing?
• 15:00
  SPEAKER_01: You can't respond saying, stop, I can't hear you, la, la, la, la, la.
• 15:03
  SPEAKER_01: Do you really think that's how disclosure law works?
• 15:06
  SPEAKER_01: I mean, creating a policy of if I don't receive the document, then I don't have anything to disclose.
• 15:11
  SPEAKER_01: Knowledge isn't limited to a PDF that is sitting in your inbox.
• 15:16
  SPEAKER_01: If you learn about a material problem, the analysis is about what you know and what the law requires, not whether somebody attached the inspection report.
• 15:24
  SPEAKER_01: So the rule is willful ignorance is not a disclosure strategy.
• 15:30
  SPEAKER_01: If a material problem exists, you got to deal with it.
• 15:32
  SPEAKER_01: Determine what needs to be disclosed, determine whether it needs to be investigated, determine whether it should be repaired.
• 15:38
  SPEAKER_01: Don't build your entire risk management system over trying around trying not to learn things.
• 15:44
  SPEAKER_01: And if you think that's going to protect you in a lawsuit, you are very foolish.
• 15:48
  SPEAKER_01: I cannot imagine the cross-examination of you.
• 15:50
  SPEAKER_01: It would make you look like the most dishonest real estate agent in the entire world.
• 15:54
  SPEAKER_01: And guess what?
• 15:55
  SPEAKER_01: Juries love finding against people they feel are dishonest.
• 15:59
  SPEAKER_01: They love to hammer those people with big monetary awards against them.
• 16:03
  SPEAKER_01: Number six, private exclusives are better for sellers.
• 16:06
  SPEAKER_01: As you know, I have made a career over being brand agnostic.
• 16:09
  SPEAKER_01: I don't give two shits about your brand.
• 16:12
  SPEAKER_01: I don't care about them at all.
• 16:14
  SPEAKER_01: I care about you as an agent.
• 16:15
  SPEAKER_01: Your brands are interchangeable to me because you leave and change brands all the time, and it doesn't affect you as a real estate agent.
• 16:21
  SPEAKER_01: What I do care about is you as an agent and not saying dumb things because your brokerage is trying to push these dumb things.
• 16:26
  SPEAKER_01: Now, Robert Refkin and Compass, my favorite guy I like to talk about.
• 16:30
  SPEAKER_01: He's been the biggest advocate of private exclusives for some time now.
• 16:33
  SPEAKER_01: And we've heard all of his arguments.
• 16:35
  SPEAKER_01: Good for seller privacy, seller having the options, allows you to test the price, it creates exclusivity and all of that garbage, right?
• 16:43
  SPEAKER_01: And as I've said it many times, there's absolutely some situations and very rare cases where a seller needs to limit exposure, like a domestic violence situation.
• 16:52
  SPEAKER_01: Those unique circumstances actually do exist, and it's fine when they do.
• 16:56
  SPEAKER_01: I'm not saying it can never make sense.
• 16:59
  SPEAKER_01: I'm asking a different question.
• 17:00
  SPEAKER_01: Who benefits from it in an ordinary transaction?
• 17:04
  SPEAKER_01: Because Robert Refkin says something that I think is absolutely fascinating and basically destroys his whole argument.
• 17:11
  SPEAKER_01: He says approximately 96% of COMPASS' private exclusives ultimately end up on the MLS.
• 17:18
  SPEAKER_01: 96%, as if that somehow makes his argument.
• 17:21
  SPEAKER_01: But wait a minute.
• 17:23
  SPEAKER_01: If private marketing is so successful and so good for the seller, why do almost all of them eventually need broad exposure?
• 17:32
  SPEAKER_01: It kind of proves the point.
• 17:34
  SPEAKER_01: The broader the exposure, the better opportunity to sell the house.
• 17:37
  SPEAKER_01: And think about what that statistic potentially tells us.
• 17:40
  SPEAKER_01: Sellers list house instead of immediately exposing it to the broadest market, it goes to compass's very limited network, time passes, it doesn't sell, and then it ultimately goes to the MLS.
• 17:53
  SPEAKER_01: And now we announce, hey, look, the system works, but does it?
• 17:58
  SPEAKER_01: Or did we simply delay broad exposure before eventually doing what possibly needed to be done anyway?
• 18:04
  SPEAKER_01: Again, there can be legitimate reasons for limited exposure, but if 96 out of 100 eventually do go to the MLS, I think we're entitled to ask, what did the seller gain during that private period?
• 18:17
  SPEAKER_01: And equally important, what did the brokerage gain?
• 18:20
  SPEAKER_01: Did the brokerage get first access to the buyer lead?
• 18:24
  SPEAKER_01: Did the agent get an opportunity to represent both sides?
• 18:26
  SPEAKER_01: Did the did it strengthen the value of the proprietary network?
• 18:30
  SPEAKER_01: Those aren't necessarily illegitimate business goals, might be, but don't confuse the broker's business interest with the seller's fiduciary interest.
• 18:39
  SPEAKER_01: And I love the argument that sellers supposedly want to spend additional time trying to sell their house because that's what sellers always tell me.
• 18:46
  SPEAKER_01: Gary, I want to sell my house, but I'm worried you're going to sell it too efficiently.
• 18:51
  SPEAKER_01: Is there something we could do to just drag this out even longer?
• 18:54
  SPEAKER_01: Nobody says that.
• 18:55
  SPEAKER_01: Most sellers want maximum price, favorable terms, reasonable certainty, and an efficient, timely sale.
• 19:01
  SPEAKER_01: So if you're recommending restricted exposure, explain specifically how restricting the pool of potential buyers advance the seller's objectives.
• 19:09
  SPEAKER_01: Not your objectives, not your broker's objective, the seller's objective.
• 19:13
  SPEAKER_01: And I know that the higher-ups are starting to really push this crap, so you've got to be very careful.
• 19:18
  SPEAKER_01: You are your own business.
• 19:21
  SPEAKER_01: Do what's in your client's best interest and not what the best interest of Robert Refkin or some higher up in your company.
• 19:27
  SPEAKER_01: Number seven, I don't know if the earnest money's been deposited.
• 19:31
  SPEAKER_01: Why don't you know?
• 19:32
  SPEAKER_01: Seriously, you're representing somebody in a real estate transaction.
• 19:35
  SPEAKER_01: The contract requires earnest money.
• 19:37
  SPEAKER_01: Three weeks later, somebody's asking you, did the buyer deposit earnest money?
• 19:41
  SPEAKER_01: And your response is, I don't know.
• 19:43
  SPEAKER_01: How do I know that?
• 19:44
  SPEAKER_01: Now let's be clear, that doesn't mean you're necessarily the escrow agent.
• 19:47
  SPEAKER_01: It doesn't mean that you're personally taking the check to the bank.
• 19:50
  SPEAKER_01: That's not the point.
• 19:51
  SPEAKER_01: The point is you're managing a real estate transaction for your client, and earnest money delivery is part of that transaction.
• 19:57
  SPEAKER_01: Was it delivered?
• 19:58
  SPEAKER_01: Was it timely?
• 19:59
  SPEAKER_01: Who's holding it?
• 20:00
  SPEAKER_01: Has there been any problems with it?
• 20:02
  SPEAKER_01: Because when do agents discover it wasn't delivered?
• 20:05
  SPEAKER_01: Usually when the transaction blows up.
• 20:08
  SPEAKER_01: Seller says, fine, I won't sell the house to your buyer, but give me the earnest money.
• 20:12
  SPEAKER_01: And then suddenly everybody starts looking around, going, where's the earnest money?
• 20:16
  SPEAKER_01: This is not the moment to be investigating whether or not the earnest money has been paid.
• 20:20
  SPEAKER_01: And the real estate commission has made the point that agents have absolute responsibility regarding these transaction details.
• 20:26
  SPEAKER_01: And beyond the regulatory requirements, basic agent duties include reasonable care and diligence.
• 20:31
  SPEAKER_01: So you better build a system where the contract's executed, earnest money has a due date, you calendar it, you confirm it, you document the confirmation, done.
• 20:40
  SPEAKER_01: If you work with Blair Cato as you should, we will send you an email confirming the deposit of the earnest money as soon as it's been made.
• 20:47
  SPEAKER_01: It's not that difficult, but it certainly matters.
• 20:49
  SPEAKER_01: And this is part of a larger point that I make constantly.
• 20:53
  SPEAKER_01: A real estate agent's job isn't simply to find the house or put the house on the MLS.
• 20:59
  SPEAKER_01: The value of a great real estate agent is navigating and managing the transaction.
• 21:04
  SPEAKER_01: You manage people, you help navigate the transaction, and that's where professionals distinguish themselves.
• 21:09
  SPEAKER_01: So I don't know if the earnest money was deposited.
• 21:12
  SPEAKER_01: Isn't an acceptable transaction management system.
• 21:14
  SPEAKER_01: Find out.
• 21:16
  SPEAKER_01: It's your license.
• 21:17
  SPEAKER_01: Number eight, the appraisal came in low, so the seller has to sell the house for the lower price.
• 21:22
  SPEAKER_01: No, they don't.
• 21:23
  SPEAKER_01: And this is one of those statements that gets repeated so often that people start treating it like it's law.
• 21:27
  SPEAKER_01: House is under contract for$500,000.
• 21:29
  SPEAKER_01: The appraisal comes back at$475.
• 21:31
  SPEAKER_01: Buyer's agent calls.
• 21:33
  SPEAKER_01: Bad news, the seller needs to reduce the price to$475.
• 21:35
  SPEAKER_01: Really, why?
• 21:36
  SPEAKER_01: Did the appraiser amend the contract?
• 21:38
  SPEAKER_01: Did the appraiser suddenly become a part of the contract?
• 21:40
  SPEAKER_01: Did the seller give the appraisal a power attorney?
• 21:43
  SPEAKER_01: No, absolutely not.
• 21:44
  SPEAKER_01: The appraisal is relevant to financing and potentially the rights created under the contract.
• 21:50
  SPEAKER_01: That's very different from saying the appraisal automatically establishes a new purchase price.
• 21:54
  SPEAKER_01: Maybe the buyer has an appraisal contingency.
• 21:57
  SPEAKER_01: Maybe the financing provisions are in the contract that matters.
• 22:00
  SPEAKER_01: Or maybe the buyer can simply terminate it.
• 22:01
  SPEAKER_01: Maybe the parties have to renegotiate.
• 22:03
  SPEAKER_01: Maybe the seller does lower the price.
• 22:05
  SPEAKER_01: Maybe the buyer might bring additional cash to the closing.
• 22:07
  SPEAKER_01: Maybe they meet in the middle.
• 22:08
  SPEAKER_01: Maybe the seller says no.
• 22:09
  SPEAKER_01: Read the contract because the contract's going to tell you what has to happen.
• 22:14
  SPEAKER_01: And here's another thing.
• 22:16
  SPEAKER_01: Remember, an appraisal is nothing more than an opinion of value.
• 22:19
  SPEAKER_01: It's not fact, it's an opinion.
• 22:21
  SPEAKER_01: It's an educated, professional opinion, but it's still nothing more than an opinion.
• 22:25
  SPEAKER_01: And two appraisers can reach different conclusions.
• 22:28
  SPEAKER_01: A buyer and the seller can agree to the price above appraisal value.
• 22:32
  SPEAKER_01: There may be reasons a buyer is willing to pay more.
• 22:34
  SPEAKER_01: So stop saying the appraisal came in low, therefore the seller has to reduce the price.
• 22:38
  SPEAKER_01: Instead, say the appraisal came in below the contract price.
• 22:41
  SPEAKER_01: Let's look at what the rights are in the contract, and let's discuss our options.
• 22:46
  SPEAKER_01: That sounds very professional, does it not?
• 22:48
  SPEAKER_01: And by the way, it has the added benefit of being accurate.
• 22:53
  SPEAKER_01: Number nine, the seller has to fix this because it's not up to code.
• 22:57
  SPEAKER_01: All right, this one usually starts with an inspection.
• 22:59
  SPEAKER_01: Inspector goes to the house and identifies something.
• 23:01
  SPEAKER_01: Maybe it's electrical, plumbing, railing, whatever.
• 23:03
  SPEAKER_01: Maybe it's something that doesn't meet today's building codes.
• 23:06
  SPEAKER_01: And somebody suddenly announces the seller has to fix this because it's not up to code.
• 23:11
  SPEAKER_01: Well, where is that written?
• 23:13
  SPEAKER_01: Let's separate several concepts here that agents constantly mix together.
• 23:17
  SPEAKER_01: Building code is one thing, property condition is another, the inspection is another, the contract's another, and the lending requirements are yet another.
• 23:24
  SPEAKER_01: They might overlap, but they're not the same thing.
• 23:27
  SPEAKER_01: A house built decades ago might contain features that don't meet today's construction standards, but that doesn't necessarily mean that homeowner has an affirmative contractual obligation to bring the entire house to current code before selling it.
• 23:42
  SPEAKER_01: It is simply not true.
• 23:44
  SPEAKER_01: Likewise, a home inspector doesn't have the power to create contractual obligations.
• 23:48
  SPEAKER_01: The inspector might say, I recommend replacing this.
• 23:51
  SPEAKER_01: That's fine.
• 23:52
  SPEAKER_01: That's valuable information.
• 23:53
  SPEAKER_01: Then we get the lender requirements.
• 23:54
  SPEAKER_01: The lender says this has to be repaired before they'll take the loan.
• 23:57
  SPEAKER_01: Okay.
• 23:57
  SPEAKER_01: That means a lender has made the repair a condition of the loan that does not automatically answer who is contractually obligated to make or pay for the repair.
• 24:06
  SPEAKER_01: Maybe the parties will negotiate.
• 24:07
  SPEAKER_01: Maybe they've already addressed it in the contract.
• 24:10
  SPEAKER_01: Maybe the buyer has a right to terminate, might have to exercise that, or maybe somebody agrees to fix it.
• 24:14
  SPEAKER_01: But again, read the contract.
• 24:16
  SPEAKER_01: Don't turn the lender requires this for financing into South Carolina law requires you to fix this.
• 24:21
  SPEAKER_01: Two different statements.
• 24:22
  SPEAKER_01: And notice the theme developing here.
• 24:24
  SPEAKER_01: Appraisers don't write contracts, inspectors don't rewrite contracts, lenders don't rewrite contracts, agents don't rewrite contracts.
• 24:31
  SPEAKER_01: The contract says what the contract says.
• 24:34
  SPEAKER_01: Which brings us perfectly now to number 10.
• 24:36
  SPEAKER_01: Beautiful transition for a professional podcaster like myself.
• 24:39
  SPEAKER_01: Brings us to number 10.
• 24:40
  SPEAKER_01: Don't worry about what the contract says.
• 24:42
  SPEAKER_01: We do it this way all the time.
• 24:44
  SPEAKER_01: And this may be my favorite because this sentence incorporates almost every bad habit we've discussed today.
• 24:49
  SPEAKER_01: You point to something in the contract and somebody says, yeah, I know that's technically what it says, but that's not really how we do it.
• 24:56
  SPEAKER_01: Who is this we?
• 24:57
  SPEAKER_01: Is this everybody?
• 24:58
  SPEAKER_01: Is this really?
• 24:59
  SPEAKER_01: Did everybody sign this contract?
• 25:01
  SPEAKER_01: Because I'm looking at two parties, a buyer and a seller, and I'm looking at the agreement they signed.
• 25:05
  SPEAKER_01: I don't see a third signature line that says how we've always done it.
• 25:10
  SPEAKER_01: Custom and practice can matter in certain legal contexts, but agents sometimes invoke this is the way we always do things, as though it overrides language in the contract.
• 25:19
  SPEAKER_01: It doesn't.
• 25:20
  SPEAKER_01: And I see this with deadlines.
• 25:22
  SPEAKER_01: Nobody really enforces that deadline until somebody does.
• 25:24
  SPEAKER_01: Or I see it with earnest money.
• 25:26
  SPEAKER_01: Well, it was there a day late.
• 25:27
  SPEAKER_01: It's not really a problem.
• 25:28
  SPEAKER_01: Until it is.
• 25:29
  SPEAKER_01: I see it with due diligence.
• 25:30
  SPEAKER_01: Everybody knows what this meant.
• 25:32
  SPEAKER_01: Great.
• 25:33
  SPEAKER_01: But what does the contract say?
• 25:35
  SPEAKER_01: I see it with repairs, financing, closing dates, possession, personal property, compensation.
• 25:40
  SPEAKER_01: But here's the danger.
• 25:41
  SPEAKER_01: Agents can do 50 transactions where nobody enforces a particular provision very strictly.
• 25:47
  SPEAKER_01: And that creates confidence.
• 25:49
  SPEAKER_01: Then transaction 51 comes along, different buyer, different seller, different lawyer, different circumstances.
• 25:54
  SPEAKER_01: Suddenly somebody does want to enforce it.
• 25:56
  SPEAKER_01: And the agent says, Well, in my 20 years, I've never seen anybody do that.
• 26:00
  SPEAKER_01: And that may be true.
• 26:01
  SPEAKER_01: But you know what?
• 26:02
  SPEAKER_01: It's also probably completely irrelevant.
• 26:04
  SPEAKER_01: After 20 years of experience, don't amend your client's contract.
• 26:08
  SPEAKER_01: And experience is incredibly valuable.
• 26:10
  SPEAKER_01: Don't take me wrong.
• 26:11
  SPEAKER_01: I want experienced agents.
• 26:12
  SPEAKER_01: Experience helps you anticipate problems, it helps you negotiate, and it helps you to explain what will likely happen.
• 26:18
  SPEAKER_01: But experience becomes very dangerous when it causes users to substitute habit for analysis.
• 26:23
  SPEAKER_01: We've always done it that way, is not legal authority.
• 26:26
  SPEAKER_01: So if you've ever attempted to tell a client, don't worry about what the contract says, stop yourself right there, because those words after that sentence are probably going to get you into trouble.
• 26:36
  SPEAKER_01: So those are my 10 for part two.
• 26:40
  SPEAKER_01: And there's actually a common thread, I hope you saw through almost every one of these.
• 26:44
  SPEAKER_01: It's not that the agents don't know everything.
• 26:46
  SPEAKER_01: Nobody knows everything.
• 26:48
  SPEAKER_01: The dangerous agent isn't the agent who says, I don't know, let me find out.
• 26:52
  SPEAKER_01: That's a good agent.
• 26:53
  SPEAKER_01: That's the professional agent.
• 26:54
  SPEAKER_01: The dangerous agent is the person who doesn't know but answers anyway.
• 26:58
  SPEAKER_01: You have to offer buyer agent compensation.
• 27:00
  SPEAKER_01: That's the standard commission.
• 27:02
  SPEAKER_01: We terminated.
• 27:03
  SPEAKER_01: Don't worry about the fee.
• 27:04
  SPEAKER_01: Don't send me the inspection report.
• 27:06
  SPEAKER_01: Private's always better.
• 27:07
  SPEAKER_01: I don't know where the earnest money is.
• 27:09
  SPEAKER_01: The appraisal means the seller has to lower the price.
• 27:12
  SPEAKER_01: It's up to code.
• 27:13
  SPEAKER_01: It's not up to code.
• 27:14
  SPEAKER_01: The seller has to fix it.
• 27:15
  SPEAKER_01: And finally, don't worry about the contract.
• 27:17
  SPEAKER_01: It's the way we've always done it.
• 27:18
  SPEAKER_01: No, no, no.
• 27:20
  SPEAKER_01: Here's what professionals do: they read the contract, they know the law, they know their agency duties, they know who their client is, they explain options, they document those decisions.
• 27:30
  SPEAKER_01: And when you don't know the answer, say it.
• 27:32
  SPEAKER_01: I don't know.
• 27:34
  SPEAKER_01: Let me find out.
• 27:35
  SPEAKER_01: Those seven words will probably save you from saying a whole lot of dumb shit.
• 27:40
  SPEAKER_01: And they'll probably save you from a few lawsuits and a real estate commission complaint along the way.
• 27:45
  SPEAKER_01: All right, that's all the time I have for our show today.
• 27:46
  SPEAKER_01: Hope everybody enjoyed it.
• 27:48
  SPEAKER_01: And please like us, share us, and subscribe.
• 27:50
  SPEAKER_01: Please go on to YouTube if you got a chance and click that subscribe button.
• 27:53
  SPEAKER_01: We're trying to get those subscribers up there as well.
• 27:55
  SPEAKER_01: And I hope you have a wonderful weekend.
• 27:57
  SPEAKER_01: And we'll see you again next week for another episode of Digital.
• 28:00
  SPEAKER_01: Y'all take care and have a great