5 Warning Signs That You Should Reject a Listing

It’s the call or the email that all real estate agents want, right? A seller reaches out and says that they want to sell their home. As an agent, you are all ears. Who wouldn't want a listing? To prepare for the listing presentation, you study the comps, do your research and print out a copy of a listing agreement. A good agent will seal the deal on the spot, right?

Not so fast. A good agent sees the listing presentation as mutual meeting of the minds, to feel each other out. It’s as much an interview of you by the seller as it is an interview of the seller by you. A good agent doesn't go into the meeting ready to take the listing. It's rare that a seller decides to list their home overnight. A smart seller does research, learns about the market and contacts a good local agent early in the process. They work with an agent to understand how their home will fare in the market and what they need to do to get it ready to list.

Selling a home has not only financial implications, but practical and emotional ones as well. The two biggest ways a seller resists the advice of an agent are price and recommended changes to the home. If you think about it, these are never really the core issues at hand. A good agent should be ready to scratch the surface to find out more about the intentions of the seller. Be ready to say no to a listing. Otherwise you could endure months of showings, lots of marketing dollars spent and potential animosity between you and the seller. Here are five warning signs that you should reject a listing.

The seller is not emotionally ready to sell

Has the seller lived in the home for a long time, or are they very attached to the home? Ask questions about the seller's experience there. Many times, a seller knows that a pending life change is in the works, but they are not quite ready to pull the trigger. They think that by “listing” their home for sale, they are absolutely ready to sell. But, if you find that a longtime homeowner is resisting your recommendations or can’t quite emotionally detach from their home, they may not be ready to sell it. Some clues include thinking that their home is superior or not being objective about how it looks or how it will show. If sellers can’t pull themselves out of the home and see it as a “product” for sale on the open market, then you face an uphill battle.

The seller is not financially able to sell

Given the uptick in the market over the past eighteen months, many homeowners believe that they can finally sell and maybe even buy a home. A potential listing as well as a buyer would seem like absolute music to the ears of an eager agent, right? Maybe not. You have to ask the hard questions. How much is their outstanding mortgage? How much money do they have for a down payment? Have they spoken to a mortgage professional about how much home they can afford to buy? Have they considered all of the costs associated with closing on a home? You know the market better than anyone else. If you feel that the current market value of their home doesn't lend itself to sale numbers that will work, you might want to suggest that the sellers hang tight a little while longer. Keep their contact information and keep them posted on the comps. Stay in touch so that when they are financially ready to sell, you will be the person they call.

The seller is not practically ready to sell

The first question a good agent should ask a seller when they sit across the dining room table is, “why are you selling?” It seems like a basic question, but an open-ended question like this could reveal a lot. Oftentimes a seller does not have a plan to move. Their answer may be something like, “we aren't sure, we want to see how much we will get for the home and then figure it out.' This is a huge red flag and you should run. This person has no plan in place. They could be opportunistic about selling the home, but may not be there in a practical sense. You need to ask them lots of questions. Ask what they would do if they got an offer at X price. Where would they go? Chances are they will reject your price and request a higher list price to buy themselves time until they have a place to go. In this case, suggest that they put the listing on the back burner until their plans are more solidified.

There is drama with the seller

It may be hard for a newer agent to flesh this out but an experienced agent is always on the lookout for sellers who are not on the same page. The divorcing couple is always a big red flag. The seller who is pushing for the sale is likely the one who will reach out to you. You will be eager to get in his or her good graces. Ask questions of the other seller and try to understand their position. It's likely the seller who doesn't want to sell is the one who objects to price, process or getting the home ready to sell. They do these things as ways to sabotage the sale. If you sense you are dealing with sellers with disparate takes on selling, you should think twice and save yourself some time and money.

The seller wants to be your best friend

As real estate agents, we act as financial advisers, therapists and sometimes middlemen. But, we also serve as a warm body, a pal or new friend. Agents tend to get personal with sellers. Being invited into their home is like being invited into their lives. They may see you as someone they can dump on, talking to you about what is going on in their life and all of the personal things that are tangentially related to selling the home. How many times have we found ourselves as sounding boards to people who aren't really making a move? It's tricky because you want to be helpful but you also have a business to run. A good agent will manage her time wisely and will not attach or make a new friend. When it comes time to sell, the seller might be emotional and take their issues out on you, their new friend and punching bag. Try to avoid this by not taking on any unnecessary new friends.

As enticing as it may be to take a listing, it’s often better to tell a seller that they shouldn't sell. It might sound contrarian because we, as agents, are in the business of listing homes. A good agent will work with a seller as a consultant, an advisor and someone they can count on for information and assistance many months before they are ready to sell. Know that a seller expects you, as an agent, to come into that first meeting wanting to list the home right away. Be ready to take a step back and offer alternatives to listing immediately. It will likely lead to your getting the listing down the road.

Note: The views and opinions expressed in this article are those of the author and do not necessarily reflect the opinion or position of Zillow.