I own 4 different homes that are all sitting on the MLS and I would like to sell them by the end of the year. Locations are:
Newberry, SC (listed at $45.5)
Trinity, AL (listed at $87.5k)
Heber Springs, AR (listed at $105k)
Gilmer, TX (listed at $49.9k)
All homes are slightly below market value and I could just wait for the houses to sell but I'm motivated and want to help motivated my listing agents. Currently all have standard broker contracts at 6%.
Is it ethical and legal to offer my realtors a $1,000 bonus if they can sell by the end of the year (within say plus or minus 10% of listing price)? I have a couple concerns with doing something like this, one of which is if the home doesn't sell will I end up with a really disgruntled agent come first of the year?
Is it common to offer bonuses to realtors in slower markets, any comments or suggestions are greatly appreciated. Thanks
It is commo and makes more sense to have agent offer seller bonus thru the mls to other agents.Example seller offers s500 b8nus if sold by thanksgiving. If you have a 10% leeway in price you should reduce price every 10 days or so Price sells homes.I would also offer buyer inducements like closing incentives..Lastly I would call your agent to confer on marketing plans, feedback and of course price adjustments good luck
first thing i would do is put "motivated seller" in the MLS ticket.
second is lower the price if you are that motivated.
try it, but i dont think the incentive will help.... remember that most agents just finished high school and some have a political science college degree (worthless), so they can't think outside of a plastic bag.
If "All homes are slightly below market value", then you MUST be able to get your price!
But remember, I wrote "If"...
low value homes in secondary or tertiary markets can take forever to sell at any price.
many times the only people buying these are investors like your self.. so you need to back into what an investor in that area will pay for a given cash flow and price it accordingly.
Folks that CAN afford to buy a home and that means they can afford a 1k mortgage simply are not going to buy a 50k home to live in in most instances they will buy the nicest thing they can.
folks don't really realize this until your stuck with these things..
Thanks! Appreciate the feedback
The agent should be working for you. But in this case it's sounding like you are working for the agent. Change that dynamic first and the rest will sort itself out.
@Josh Miller , were you selective with your agents? Did you interview them and look at their resumes and such? Those homes may be hard to sell but they should all be just as motivated (or more) to see these homes sell as fast as possible.
Hopefully you got great pictures taken with each property and your realtor is out doing open houses and such to draw greater attention to the properties. I would think it's okay for you to stress your wanting these homes sold before the end of the year without having to offer them anything extra.
Easy...Hire new agents! A bonus isn't going to sell your properties a professional, motivated due diligent agent is whats going to sell your properties. I'd love to hire a $1,000 bonus to sell my home but unfortunately my only choice is an agent with a selling fee of 3%.
Hire agents who are hungry enough to network, advertise, eat-sleep, and wake up with the intent to try every outlet possible to sell your properties. I understand the slow market in your area, but it is inevitable for people to not buy homes no matter how slow the sales are. Agents just have to market to the right populations. Real estates fuel is driven by the 3D affect...death, divorce, and discomfort. There is no slow market out there that can stop the 3D.
A bonus to encourage an agent to sell your properties faster or sell in general in a slow sale area isn't an agent I would want working "for me." This is their job/career If they want to get paid like you want to sell, believe me they will bend over backwards to sell a home and search for the most suitable buyers without a bonus. Hope I wasn't to blunt, Just my opinion as a former agent and present investor.
Updated almost 2 years ago
AFFECT sorry again for typo! lol
Updated almost 2 years ago
Effect not affect sorry for the typos.
It can be done if this is a priority. Run local Craigslist ads in each market, offer seller financing, and there's always the auctioneer. Good luck.
How are they marketing the homes? Simply put it on the MLS, sit back, and wait for an agent to bring a buyer? They should be holding open houses. They should be advertising it in other places such as CL, BP, newspapers, etc. Offering a bonus is also a good idea. You can offer it to both the listing agent and selling agent. If you have any room on price, you might want to drop it now. Also look at the wording of their ad. I saw one HORRIBLE agent here that had EIGHT WORDS in their listing. Eight! Either they were extremely lazy or extremely incompetent. Pictures and descriptions sell houses! The idiot that had an eight word listing....come look at my houses..woohoo...had it sit on the market over a year with almost no showings. They had one picture (probably because that is required by the board). Make sure your agent is doing a good job. If not, find a new one.
Free eBook from BiggerPockets!
Join BiggerPockets and get The Ultimate Beginner's Guide to Real Estate Investing for FREE - read by more than 100,000 people - AND get exclusive real estate investing tips, tricks and techniques delivered straight to your inbox twice weekly!
- Actionable advice for getting started,
- Discover the 10 Most Lucrative Real Estate Niches,
- Learn how to get started with or without money,
- Explore Real-Life Strategies for Building Wealth,
- And a LOT more.
Sign up below to download the eBook for FREE today!
We hate spam just as much as you
Create Lasting Wealth Through Real Estate
Join the millions of people achieving financial freedom through the power of real estate investing