I've been listings REO's now for longer than I care to remember and from time to time asset managers list properties at a higher price than I recommended in the BPO. I learned that there is nothing I can do about this except keep telling them in the Monthly Reports why the price is too high. After several months the price will get reduced down to where it should have been, the property will sell, and live will go on.
I always assumed that this high price was due to the 2nd BPO coming in at a higher price and the asset manager thought I was trying to low ball the price for a quick sale. I also assumed that the high price of the 2nd BPO was caused by the agent taking an assignment in an area that they really didn't know and pulled bad comps or that they were just incompentent. I know both of these to be true in some cases. Those of you that are doing 2nd BPOs, please don't jump all over me for that last statement. I know most of you are trying very had to get it right.
Anyway, yesterday I was interviewing a new agent who had been a tranaction coordinator with a large group. During the course of the inteview, the agent mentioned that the group leader had been interested in getting into the REO business and had started doing BPOs as a way in. This started a conversation about BPOs and I related a recent problem I had where I had to explain to an asset manager why my BPO value was correct and the other 2 they had ordered were not (the other 2 had come in at a much higher value than mine).
The agent that I was interviewing then said to me " You know that some agents produce the highest value they possibly can thinking that this may be a way of get the listing".
We've all encountered this situation before. You go on a listing appointment and give the homeowner your best opinion as to what their house will sell for only to find out later that you did not get the listing because another agent told them they could get a lot more.
Call me dumb or somthing but it never really occured to me that someone would blow out a value on a 2nd BPO thinking that this would get them the listing.
Now I'm wondering how many times this is happening. Any thoughts?
Replies
And as long as we have "old world" agents doing everything they can to eat, they will continue to upset the "new world" of REO. This will not go away until the market returns to normal. Whatever normal will be in the future, the "old world" I fear is long gone!
It's not just agents causing these issues, but asset and property managers also!