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SVreX SuperDork
7/10/09 2:01 p.m.

No sir, I suggest that the issue IS the forethought (or rather, lack thereof).

Helterskelter Reader
7/11/09 1:29 a.m.

I've worked for a top producer Real Estate Broker (top 3% in town for 15+ years) for three years now and have learned quite a bit from him (if anyone needs a good broker in Tallahassee, PM me). First, a quality Real Estate agent is not going to price your house much (if any) higher than the appraisal. We have a fairly solid market in Tallahassee (college town, state government, ect) and we still have ~14 months of inventory in all price ranges. That means less ~7% of the houses in any category sell each month, and it's going to go down further since we're past the meat of the market. Since an agent only gets paid if the house sells, anyone worth a damn WILL NOT list a house for more than it can be sold. Otherwise, they're wasting time and money on advertising, as well as clogging the market with bad inventory. Furthermore, a bank will not loan more than what the home appraises for, and with recent tightening of appraisal rules, there is very little wiggle room.

So, your ex may be able to get a freshman Realtor in there, who is desperate for a listing, and will list for an unrealistic price, but that is just going to hurt both of you. Your home will not reach the market with much, if any, force and will be overlooked. At my office, we will not list houses for people who are unrealistic about what their home is worth. If it is not top 5% in price AND condition, then you have to either lower the price or fix it up, because it is not going to sell otherwise. If the owner is unwilling or unable, now is not the time to sell and we have to turn down the listing. When we have a prospect, we do a CMA report (comparative market analysis) as well as pull spreadsheets on the inventory in their price range and give the owners what they need to make an informed decision about listing price.

I think it is clear that you need to sell your home and get a lawyer to split up the debts appropriately and fairly. It seems your ex is not reasonable on this front or the front regarding the home's value. The bottom line is you're going to take a beating when you sell your home, it's simply a buyer's market and there's no way to get around it. If the appraiser says it is worth 240k, then that's probably going to have to be the list price. If you got a bad appraisal, and the CMA report shows similar houses in your area going for more, you may be able to list for slightly more. Also, be aware you're going to pay ~15k in closing costs.

If an owner is given ALL the market information in a clear, easy to read format, they are much more likely to understand why their home is worth 60k less than they thought. It hurts, but you cannot argue with the facts. After finding a lawyer and figuring out the debt split, I would find a quality agent with a CRS designation. They should be able to give your ex the information required to understand the actual worth of your home. Even if you list it at 240k, someone is going to come in and offer 200k, so be prepared for that, you can always counter. But, also be aware that the meat of the market is over, and things are slowing down, so a turned-down offer now could mean having your home languish on the market for many more months. I'm not saying let someone steal your home out from under you, but take a step back and look at the market as a whole, and be aware of just how soft it is. It may be better for both of you to get out of the house and pay back your respective parents when you can, because right now, it's dead money sitting there.

I hope some of that information helps. I also hope everything works out for you. If you have anymore questions feel free to PM me, and if I cannot answer them, I can always ask my boss. If you need help finding a CRS agent, he can help you with that as well. Not all Real Estate agents are thieves (I thought they were before I started working for one). We do our best to help people make sound investments, and also get out of bad investments (or get out of homes when in financial trouble). Being a commission based business, people are often wary and suspicious of them. A good agent will work with your best interest in mind, but they're also going to be honest about the market, and what your home is worth. Cheers and goodluck.

SVreX SuperDork
7/11/09 7:18 a.m.


Very good summary, and you are absolutely correct. Not all agents are thieves. There are a lot more good ones than bad ones.

You are also correct that quality RE agents should price things fairly.

Your broker is a little unique in taking the perspective that he won't take the listing if the seller is unrealistic. He's right, but that is rare.

Though I agree with the theory of everything you have said, I've learned in 27 years in the business that it doesn't always work that way in practice.

It is ALWAYS possible to find an agent who will make unrealistic promises of value up front. She seems dead set on finding this person, and she will.

When push comes to shove, there is a fundamental reason that RE agents are often willing to list high. Most sellers will budge, given enough time. If they list it, and work with the seller, the seller is likely to stick with them 'till the end and blame the market for the "loss", not the agent. It's a simple odds game. If you've got the listing, you've got a chance. If someone else has the listing, you've got NO chance.

If a house is listed for $300K that ends up selling for $240K, the seller takes a perceived loss of $60K. Considering most commissions are around 6%, and most offices split 50/50 with the broker/ agent, the agent only "looses" $900.

In reality, the seller did not loose $60K. It wasn't ever going to sell for that. He lost the TIME it sat on the market, and the expenses of owning it for all that time. And the agent didn't loose anything either. He GAINED the ability to make any commission at all, because if he had refused to list the property, someone else would have eventually made the commission.

I respect your higher moral ground, and agree completely with you. I just know that theory and reality are not always the same thing.

The advantage an appraiser has over an agent is that he has no vested interest. He is paid for his service of appraising, not selling. His payment is not tied to the sale of the property at all.

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