3 Things Sellers Should Never Say to Real Estate Agents
When trying to sell your home, it's a smart idea to establish a good relationship with your real estate agent. After all, this person is working hard on your behalf to get your home sold. Openness and honesty with your agent can make a big difference. Still, there are some things home sellers should not say to their real estate agents, the pros agree.
For example, you should probably sidestep financial details that may take your leverage away as a seller. It's best to avoid divulging personally sensitive information, too. And you don't have to reveal every detail about your house -- only those required by law, or items which help sell the property.
Think carefully about what you want to discuss versus what you need to talk about with your real estate agent. Read on for tips for home sellers regarding what you should and shouldn't reveal to your real estate agent.
Proper communication is key
Above all, bear in mind that your real estate agent is on your side. The right professional has a vested interest in ensuring that your home sells relatively quickly and for the most money. To be able to do that successfully, there has to be mutual trust and sharing of information between seller and agent.
"Honest and open communication with your agent when selling a house is important because there are many moving pieces. And this is probably one of the largest transactions you will make in your life. So it should be as smooth as possible," says Daniele Kurzweil, a real estate agent with the Friedman Team at Compass in New York City.
Anthony Babbitt, former real estate broker, landlord, and home flipper in Bellevue, Nebraska, echoes that thought.
"It's essential that you feel heard and understood by an agent. Selling a home represents a huge investment. This is not the time to leave anything to chance," he says. "I advocate that people find someone with whom they work and communicate well. Your expectations of the seller should be set appropriately, and agents must know what is expected of them."
Being honest is admirable. But it's also important "not to overshare and show all of your cards at once," Kurzweil adds.
Related: 5 Signs of a Bad Real Estate Agent
Topic #1 to avoid: Your price floor
You'll want to think twice before broaching particular topics or sharing some information with your real estate agent. Among the things home sellers should not say, the lowest price you are willing to take is probably a no-no.
"The primary thing I tell people not to discuss is the minimum price they will accept," notes Babbitt. "When you tell your agent your lowest price, they are going to shoot for that price in the contract. No agent will set the bar any higher than he or she has to set. Neither would you if you were in their shoes."
Consider what is required of an agent to get you a full price offer. This person likely has to work extra long and hard to market the home and find the right buyers.
Usually, a home sale nets a 6% commission -- 3% of which goes to the buyer's agent and 3% of which goes to the seller's agent. But your seller's agent usually has to split that with the broker, meaning they really get about 1.5%.
If your home sells for the $200,000 you hope to get, your agent will earn about a $3,000 commission. But if you say you're willing to go as low as $185,000, that will still yield a $2,775 commission - a difference of only $225.
"Why would your agent work extra hard just to earn an extra $225," Babbitt continues, "when they can sell your home more quickly and confidently by aiming for your lowest acceptable price?"
Related: Is the 6% Real Estate Commission a Rip Off?
Topic #2 to avoid: Personally sensitive information
Ideally, you want to be able to talk openly and freely with your agent. But truth is, this person doesn't need to know about every personal detail in your life.
Among the things you should probably never disclose to your real estate agent are details about private family matters that won't impact the sale. These can include major life changes, deadline-sensitive matters, and pressure situations. For example: divorce, pregnancy/birth, adoption, job relocation, illness or death in the family, personal relationship challenges, or litigation you are involved in.
Also, keep sensitive financial information to yourself. Income, savings, investments, bank accounts, credit scores, and other private money matters are your business - not theirs.
An untrustworthy agent could use these details against you. For example, your agent could pressure you into selling sooner or for less money than you are comfortable with. Doing so, they may argue, may give you more time and resources to handle those personal matters you talked with them about.
Related: Selling a Home (What Not to Tell Your Real Estate Agent)
Topic #3 to avoid: Property details not required by law
Most states obligate you to disclose any material defects your property has - including things like mold, lead paint, and structural damage. But the laws and rules about what you are required to disclose vary from state to state.
It's important to be honest and forthcoming with your agent about any defects you are aware of, of course. If you withhold these key details, the buyer could try to sue you later for failing to disclose.
But that doesn't mean you have to fess up about everything negative related to your home or location.
"For instance, you are not required to disclose negatives unrelated to your home's condition," says Babbitt. "These can include the meth lab that just moved in down the block, the frequency of police visits to your block, or the fact that the plant supporting the town is shutting down."
When in doubt, research the disclosure laws for your state or consult a real estate attorney.