There’s a deeper problem in real estate that nobody in the industry talks about openly, because the incentive structure quietly discourages it.
Upton Sinclair said it best:
“It is difficult to get a man to understand something when his salary depends upon his not understanding it.”
That sentence explains a lot of what happens behind the scenes in this business.
Here’s a recent sale that lays it out cleanly.
A home sold for $1,005,000. It was 6,050 square feet — the largest home among recent comparable sales in its area. Four comparable homes nearby had closed in roughly the same window:
- One at $1,330,000
- One at $1,175,000
- One at $1,115,000
- One at $959,000
Average sold price: $1,144,750.
Start with the most generous possible comparison — straight sold price against sold price, no adjustments at all. The subject sold for about $140,000 below the average of its four direct comps.
That’s already meaningful. And the comparison is genuinely conservative, because the subject was the largest home of the group. Larger homes generally trade for more, not less. So even before any analysis, the raw numbers already point in the wrong direction for the seller.
Now layer in price per square foot. I’ll be upfront about something most agents won’t tell you: $/SF isn’t a perfect metric. Lot value is fixed regardless of home size, so larger homes typically show a lower $/SF than smaller ones in the same neighborhood — the fixed lot value gets spread across more square footage. That’s a real limitation of the method.
But here’s why it still matters in this case: even with that adjustment baked in, the gap doesn’t shrink. It widens.
The four comps averaged $221 per square foot. The subject sold at $166 per square foot — about 25% below the comp average. Applied across a 6,050 square foot home, that math suggests a fair value closer to $1.34M. And one of the four comps actually closed at $1.33M, so that ceiling isn’t hypothetical — a comparable home in the area, properly marketed, recently hit it.
Two separate methods. One that favors smaller homes by design. One that ignores size entirely. Opposite weaknesses — same conclusion.
Now here’s the part that should stop anyone reading this in their tracks.
We’re talking about averages.
Averages already include the disappointing sales. The homes that sat. The ones that took price cuts. The tired ones, the dated ones, the awkward floor plans, the ones that didn’t photograph well. The average is being dragged down by every weaker outcome in the neighborhood.
The largest home in the group — in a seller’s market — couldn’t clear average.
That isn’t a “the house needed updates” outcome. A $140,000 shortfall on the raw price comparison, with a $335,000 shortfall once you size-adjust, isn’t a paint-and-carpet number. That’s a stripped-to-the-studs, new-roof, new-kitchen, new-bathrooms, new-windows, new-HVAC kind of number. Very few homes — and almost no home that sold with zero days on the market and a buyer already in hand — need anywhere near that level of renovation.
So we’ve eliminated the easy explanations.
What’s left is the structure of the transaction itself.
The property was never exposed to the open market. Zero days. It was listed and immediately marked contingent — a deal already in place before any other buyer could see it, walk it, or bid on it.
The buyer and seller were represented by the same agent.
The home closed at 1.5% over the asking price that the seller’s own agent had set.
A dual agency transaction, zero public market exposure, no competing offers, and a sale price that came in well below where two independent methods of analysis say it should have.
Both sides of this deal walked away convinced it was the right outcome.
One of them was wrong.
The evidence points to the seller.
This is what incentive structure does.
When a single agent represents both parties in a transaction, the two sides want opposite things. The seller wants the highest price the market will pay. The buyer wants the lowest price the seller will accept. Those interests cannot both be advocated for at maximum strength by the same person at the same time. That’s not a moral statement, it’s arithmetic.
Dual agency is legal. And many agents genuinely believe they remain neutral. But return to Sinclair.
If an agent already has the buyer, already has the seller, and already has both sides of the commission secured before the home is ever exposed to a single competing buyer — what is the incentive to push harder? To risk the deal falling apart? To insist on broader market exposure that might price the buyer out? To hold out for a higher offer that might never come?
There usually isn’t one.
And I don’t think most agents in this position are consciously sitting at their desks trying to undersell someone’s home. That’s not how this works. The danger is subtler. The structure itself quietly shifts the goal — away from getting the seller the most and toward getting the deal closed. Avoid friction. Keep both sides calm. Collect. Move on.
But the seller only sells the home once.
The hardest thing about all of this is that most sellers never find out.
There’s no control group. You don’t get to relaunch the property six months later and see what a competitive market would have actually paid. You don’t get to see the offer that never came in because the home was contingent before anyone could write one.
The opportunity exists exactly once.
Eventually some sellers do figure it out. They watch the next few sales close on their street. They run the numbers. They stand around a neighbor’s bonfire one fall evening, and the conversation turns to what so-and-so just got for their place, and the math doesn’t sit right.
And they’re left with a question that doesn’t have a comfortable answer.
So here’s the question worth asking before you sign with anyone. Not whether your agent seems nice, or responsive, or knowledgeable — those things are table stakes.
The real question is this: why would this agent care about you after the deal is closed?
Most agents in this business operate on a volume model. Constant new leads, paid advertising, online funnels, a steady pipeline of strangers replacing strangers. In that model, your transaction is the product. Once you’ve closed, you’ve already given the agent everything they needed from you. There’s no structural reason for them to think about you again.
And in a business where the agent’s next paycheck depends on the next client, not the satisfaction of the last one — that question doesn’t have a comfortable answer either.
I want to be honest about why I wrote this.
I’m not writing it to be the loudest voice in the room. There are plenty of agents who are louder, who run bigger ads, who close more deals in a year than I will. I’m not interested in competing on volume.
I wrote this because I’m tired of watching people get taken advantage of in this industry — quietly, without ever knowing it happened. And the people doing it are usually charming, well-connected, and very good at making everyone feel like the deal was a win.
So consider this me speaking up. Not to call anyone out by name. Just to say: if you’re thinking about selling, please pay attention to incentives. Yours, mine, and whoever you end up working with.
For my part, here’s what I’ll tell you plainly: I want your business. I need it. My entire business runs on referrals from people who felt I actually showed up for them — which means I can’t afford to do anything less than that. If you work with me, you’re going to get someone who takes pricing strategy seriously, insists on real market exposure, and tells you the truth even when it’s uncomfortable.
Because the last thing I want is for one of my clients to be standing at that neighborhood bonfire a year from now, hearing what someone else’s home sold for, doing the math in their head, and quietly realizing they undersold.
Or, on the other side, overpaid.
That’s the part of this job I take most seriously. And if any of this resonated with you, I’d be glad to talk.