Sounds like a good idea right? Get more agents working for you, create more competitive tension to sell your property? You can sack any agent at any time if you are not happy with them?
Well the reality is very different! Our experience shows there can be a major problem with using 2 or more agents.
An open listing as the name suggests is open to any number of agent's you choose. It doesn't seem like a bad idea in the sense that you can terminate any agent at any time if you are not happy with them and you only pay the agent who makes the sale. But even better still, if you sell the property yourself you don't have to pay anyone! Sounds great..
The main problems with this method, and they are serious ones, are:
1. You will reduce the chance of achieving the highest sale price, and
2. The agents will almost certainly make little or no effort to sell your home.
The reason an open listing can ultimately affect the sale price you receive is because, as in the Multilisting method, a buyer can now choose which agent they use to inspect your property. Because an agent knows that other agents also have access to your property they feel the need to "lure" the buyer to use them. And the only "tool" they have at their disposal to use to "lure" the buyer is your money. How do they do this, they may suggest to the buyer that they may be able to secure the property at a figure which sounds good for the buyer.
Let's be a bit clearer... buyer asks... how negotiable are they? Agent 1 says... look they are fairly negotiable, you'll probably get $10,000 off. The smart buyer then calls another agent who has the property for sale and asks the same question. Agent 2 thinks... I know other agents have got it for sale, I really want them to come to me so I can show them through and get the sale. Agent 2 then says... I know they are keen to sell, I think you're in for a chance at maybe $15,000 less than what they are asking. Now put that buyer's hat on again... which agent are you going to make an appointment with to inspect the home... agent 1 who said you'd get $10,000 off or, agent 2 who said you'd get $15,000 off?
This is reality, it does happen. And now the agent is under pressure to perform, but not for you the seller, for the buyer. See the agent now has to deliver on the $15,000 off!
Serious buyers will notice that you are listed with numerous agents.They will investigate with all the agent's, one by one, their thoughts on a possible sale price and they will always choose the one that will save them the most money on the purchase.
The reason for lack of effort when you have a number of agents selling for you is that the agents will tend to focus more on selling the properties they hold as exclusive listings as it guarantees they will get paid. With an open listing if you are not the selling agent you do not get paid a cent.
Essentially using more than 1 agent does create competition, but unfortunately the seller is the loser in the cash department as the whole focus is now about getting the sale rather than getting the buyers highest price!