The purpose of this post is twofold:
1) To the Homebuying Public: When a Property is truly SOLD the sign is gone!
2) To “The Industry Insiders”: For those saying transparency is yesterday’s “buzzword”, until we attain full transparency by saying In Escrow or Pending vs. “SOLD” before the property is actually sold, we are not even at square one when it comes to true “transparency”.
When a property is actually SOLD…there is no sign. The sign is usually “ordered down” the day it closes, and is removed the following day or the next day by the company that installed the sign.
So when you see a “Sold Strip” stapled to the post of a home, that means it is In Escrow Pending the actual closing. When it closes…is SOLD…the sign comes down.
The industry struggles to meet the public’s request for “transparency”, and yet doesn’t really know what transparency actually means.
They think transparency means we explain what we do, when in fact transparency means” “Please Just Speak the Truth in the first place, so you don’t have to explain why you didn’t!”
Of course we are not the only ones who do this. After all, how many times does Starbucks have to explain that “Tall” = Small and “GRANDE!” = Medium?
Personally I only use these Sold Strips when it benefits my client for me to do so. I don’t think there will ever come a time when everything we do in this industry is only client oriented.
If we only considered the “parties in interest”, from the seller’s perspective we would not leave the sign up at all once the transaction was solidly heading toward closing with no contingencies remaining. From the buyer’s perspective we would never put up a Sold Strip until and unless it is of benefit to the buyer for us to do so.
How much of what we do is about US vs THEM? Worth thinking about…worth changing.
I agree that these signs are misleading but it seems I have a different perspective on when they’re beneficial or not. For sellers I think they’re slightly detrimental because, if anything, they serve to discourage other potentially interested buyers from making an offer. Admittedly, back up offers are uncommon but they are permissible and are a net positive for the seller as they may come in handy if the current deal goes sideways as the closing date approaches.
For buyers I think these signs are probably net beneficial for the same reason above, they are most likely to discourage other potential buyers who might want to make a back up offer or otherwise show interest in the home. If the seller has a fallback position or solid interest from another buyer that may lead to them being more inflexible at closing if a hiccup arises.
Marc,
For the benefit of the readers, let’s first clarify that when I refer to “the sign” and the seller, I am talking about the post and panel hanging from the sign, as that is primarily in control of the Agent for the Seller. The primary subject of this post, the “Sold Strip”, attached at an angle with staples showing the Company that represented the Buyer vs the Seller of the house, that is primarily but not exclusively controlled by the Agent for the Buyer.
Also worth mentioning is that these “Sold Strips” are somewhat a “common practice” unique to the Seattle Area, and I have not seen them anywhere else in the Country.
There really is no One Answer Fits All to the “psychology of signage”.
Yes, as you say, it may benefit the seller to continue to show the property and encourage interest from other buyers during escrow, BUT what damage might that do to the transaction? “A Bird in Hand is Worth Two in the Bush” did not become a time-valued idiom without reason. If your property has been on market for 8 months and you finally have a buyer who wants to buy it, do you really want to give them the impression that you are not happy to have them?
Most ALL buyers do not like it when they see agents showing the home they have in escrow to other buyers.
As to the buyer, timing is more the issue. You might not want to put that up before inspection negotiations are complete. You might want to make it clear that the house is NOT “sold” until the buyer finishes their due diligence and the seller and buyer come to terms with those findings.
When a buyer is purchasing the home “as-is”, you may want to put the sign up when the contract is accepted. When the property is being purchased “subject to inspection/Pending Inspection”, you might not want to put that up until the inspection negotiations are complete.
In many ways our area is a step ahead of the rest of the Country in allowing the Buyer’s Agent to interact with the signage at all. But that does not change the fact that “Sold By” is about advertising, and everything we do should be done with a lot of thought regarding what is actually best for THIS particular buyer and seller.
Admittedly, the impact of these little signs on the buyer and seller is probably very small. Their biggest impact is a modest marketing benefit to the listing and selling agents whose names appear on the signs which is why they get put up in the first place.
Not necessarily so, Marc. A few questions.
1) Do you think it has NO impact on a buyer for the seller to have an Open House after they have accepted a contract?
2) IF the Seller DOES continue to market the property and have their Agent do Open Houses while the property is in escrow, would the “Sold Strip” send any kind of message to Open House visitors that the property is not necessarily and actually “available”?
While you may say that this does not happen…it DOES! In fact I just had this “problem” in a transaction on a different property than the one portrayed in the photo above. I decided to put up the Sold Strip early and before the Inspection, because they were continuing to hold Open Houses over the long holiday weekend on BOTH Saturday and Sunday, when the offer was accepted by the seller on Friday evening. (Property listed on Thursday morning.)
This created a HUGE issue involving the MLS and what is the “rule” as to when you can attach the Sold Strip. Is it when the offer is accepted or is it after the inspection period? There is apparently no clear answer to that question. The result was that some believe it to be after the inspection is complete, but there is no “violation” if the Agent for the Buyer chooses to post it within 72 hours of the contract being accepted.
Signage does influence behavior…the behavior of the agents for sure. In fact SEVERAL agents called the SELLER of the home to tell them the Sold Strip was a violation because it was posted prior to the inspection being resolved…when it was not a violation.
I’m not talking about some “old war horse” story here. This happened just a couple of months ago.
I like the signs. The last thing I want is a buyer getting excited about a property that’s scheduled to close in 3 days.
It tells the world, this house is committed to someone else right now. If it becomes available again the listing agent will shout it from a mountain top. We all know that.
It also gives prospective buyers and sellers a chance to call someone that is actively working the neighborhood RIGHT NOW. (a huge service to the public)
The only change I see that would make a difference–have the sign say: IN ESCROW.
Kelly,
I agree that the sign should say “In Escrow” or “Pending Inspection” and then “Pending” vs SOLD BY. That is the primary topic of this post.
But I don’t understand what you mean when you say, “It also gives prospective buyers and sellers a chance to call someone that is actively working the neighborhood RIGHT NOW. (a huge service to the public)”
Why are the buyers and sellers making these calls because a property goes pending? I don’t understand that. Can you clarify when and why that kind of activity would take place, and why it is a “huge service to the public”?
I disagree. This is one post that I think you’re quite a bit off base. Let’s address your arguments one by one:
2) To “The Industry Insiders
Rule 140: Signs Following Sale.
Listing Member’s Sign. Only the listing member’s sign shall be placed on a listed property and remain on said property after sale.
Selling Member’s Sold Strip.
It may not exceed 6″ x 30″ in size.
The wording is limited to “sold by
Listing Member’s “Sold
How much of “the sign” is a tool for agents to market themselves? ex. “I just listed another property” or “I just sold another property”
There was a time when a large % of properties sold from the sign. I’m sure that number is less these days, due to the internet. But while the property is being actively marketed, the sign serves several purposes.
1) Often a buyer will see the property on the internet and do a drive by as their initial interest action. The sign helps them quickly identify which house on the street is the one for sale. House numbers are not always easy to spot while driving.
2) The sign is also helpful for an agent who is showing property for the same reason. Usually the mls will note “Sign: Yes – No” so the agent can be warned if they will have more difficulty finding the house they are showing. That is also why the mls requires a picture from the outside of the house as the main photo, making it easier to find the house from that picture. There are a few allowances in the rule, but the picture should be, and usually is, a picture of the outside of the house in most cases.
Advertising “I just listed another property” or “I just sold another property” was more a function of Justed Listed and Just Sold cards to reach a broader audience than the sign. The only time I’ve seen the sign used as a primary advertising vehicle is when an agent put their other listings on the back of the flyer. I’ve known some agents who do that, but don’t see it very often here, and I don’t think it’s an appropriate use of the seller’s flyer.
I would say that a sign is used much less often as a marketing tool, than an Open House is used as a means to get new clients. When I do get sign calls the house is usually pending, and that is why a buyer didn’t see it on the internet.
Is the signage effective in it’s purpose? I’d have to say yes. I received one direct call on the listing shown in the picture of this post, and it was the day the property went pending and came off the public site as “Active”, and before Redfin posted the “Sold Strip”. So the short period when the signage did not reflect the current status, was the day a buyer was confused and called on it. Same thing happened on my listing in Queen Anne that sold before this one.
One of the main reasons we don’t take the sign down earlier is because we would have to pay a new installation fee to get it back up if something goes wrong. I have had a seller or two ask for the sign to be removed as soon as they accepted a contract. But that was back in the days when the signs were smaller, and easy to remove and put in the trunk of my car. 🙂
Hi Jon,
First, I just released all three of your comments from the comment pending status that first time commenters go in. Sorry for not noticing them there earlier. That shouldn’t happen again. It’s apparently the function of the Word Press “plug-in” to put first time commenters into a limbo. Sorry for that.
As to your comments, I warn you not to post “proprietary” information by quoting directly from mls documents. Not sure what “rule” that is, but just a heads up.
Now to your question. You said: “I don’t think I get your argument here. Tranparency has nothing to do with this… or if it does, then we should have a different discussion.”
Transparency is about what “they” would say vs our internal terminology. Picture it this way. Someone calls you on the property and asks if the property is SOLD when it is Pending. You say yes. Then they ask what it sold FOR and you say…well I can’t tell you until it “closes”. To the average buyer or seller, SOLD means “closed” with sold price available as a “talk point”.
It’s either SOLD or it isn’t, and if you can’t tell them the SOLD “price”…then it isn’t SOLD. “Transparency” is calling it what it IS and if you can’t tell them the sold price…it isn’t SOLD. Pretty simple stuff.
You also said: “No “Sold
A semi-related question. We recently closed on a home & when the sign company retrieved the for sale sign, it left a deep hole in the front boulevard and the grass around it is all dead. We asked our agent about this and were told not to expect the hole to be filled in. Is that correct?
I’ve never had anyone ask that question in 20+ years. I’ve never known it to be an issue. Not sure why the grass would be dead around it. I’ve never known the sign company to do anything but lift the post out and put it in the truck. But to be honest, I’ve never examined it closely or been there when the sign company removes the sign.
If it were a new construction spec house, the builder would likely help you with that.
How much of an area of “dead” grass is involved? The “impact” would normally not be much at all. Just a 3″ square or so, easy to fill in and the grass would usually cover the spot by end of growing season without any help.
We also had to keep asking for it to get removed – it was still there almost two weeks after we closed. There was never a Sold strip on it either and people kept coming up and looking in it.
It looks like maybe they had trouble digging the post up. The top of the hole is much bigger (double) than the bottom and the sod is all chopped up around it. Probably about a good 6 inches of grass all around is dug up or dead. It wasn’t like that before they took the sign out.
It is a large enough hole that someone may step in it and twist their ankle, so we are filling it in today and and will try to patch the grass later. We can certainly handle the task, but we just thought that leaving a big hole like that was pretty tacky and wondered if this happens to everyone.
I would say no, it doesn’t happen “to everyone” and happens rarely.
If I were the agent and the sign company made a mess of it, I would have them come out and fix it, or have it fixed and have them credit the cost to my ongoing sign billings. More likely they would respond to an agent’s request than a home buyer’s request given the volume of business we give them.
Sorry you had a bad experience. 🙁
Interesting article & discussion. I had never heard of these types of rider strips going on a sign. Let alone them being put on by the buyers agent!
The last time I put a SOLD sign up, the deal fell apart.
That was 15 years ago.