Beth Lynah's Blog

Choosing a Real Estate Agent – More Listings Could Mean Less Money for You

Posted: October 17, 2018 by Beth Lynah-Vickers

A recent study found that real estate agents who hold 27 home listings or more will usually sell them for nearly 6% less than agents holding only a few listings, suggesting that those agents who take on an inventory above optimal levels will provide a lower quality of customer service while neglecting their clients to a certain degree.

The study, published in the Journal of Advances in Economics and Finance, has fueled speculation about the real estate market, as some agents with a high-inventory of listed properties have been accused of encouraging their clients to accept lower prices, as a means of increasing volume and the total amount of their own commission income.

Such agents may believe that, by increasing the volume of sales, the increase in commissions will outweigh the losses from lower sale prices in each of their listing transactions. However, as they put too much on their plate and try to sell more homes in certain period of time, high-inventory agents may be tempted to urge his or her clients to accept lower sale prices, while convincing them that no better deal is forthcoming or, perhaps, encouraging clients to reduce the price of the home when it is not in the homeowner’s best interest to do so.

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