Real Estate Broker · Jacksonville FL & Middletown, CT · Member since 2008 · 1k+ posts · 633 votes
I'm about to turn over my rehab to my realtor next week. Hardly any action on the fsbo, which is ok I guess, since I AM STILL NOT COMPLETELY DONE YET!!!
Anyway, this is the realtor who sold me my first two homes, is absolutely excellent, and I dragged her out to show me all the dumps on the mls, before I realized there were no deals on the mls and went off yo find my own deals. She has always helped me out with comps, etc.
At the same time, I'd like to save a buck. Do I go for the discount or no? Will I get less service for a lesser commission? Should I pay her her full fee, because she does go absolutely out of her way for me, even when she makes nothing out of it?
Real Estate Investor · Las Vegas, NV · Member since 2008 · 1k+ posts · 447 votes
19y
Sounds to me like she has earned her fee. There is a lot more that goes into selling real estate than meets the eye. If she is good at what she does she has a right to earn a living, a good agent is woth every penny. And no, I'm not an agent.
Real Estate Investor · OH · Member since 2008 · 4k+ posts · 1k+ votes
19y
Minna,
I agree 100% with Rehab702. I don't care what anyone else makes, I only care what I make! If you want your realtor to work hard for you, then pay her accordingly.
The problem is that there's not much room to bring down the commission. Assuming you're in a location where 6% is the norm, you're basically stuck with the 3% for the buyer's agent (you need that to have other agents bring their buyers to the house). So, all you can do is try to have your agent go down to 2%, but that's a full 1/3 decrease in her income. That sends a huge message and only saves you 1%. Personally, I'd pay the full the commission as long as you're having her do the full work, unless you have the potential to bring her a lot of listings, in which case you may be a position to talk "bulk" pricing.
My agent told me that 1.5% of her 3% goes to her overhead. Even though she is independent she has to pay to use the name of the big-name real estate company and pay for her office, ect. Take taxes out of that and, well, you do the math. Besides, she may become offended if you suggest paying her less. It isn't worth it.
Minna, I think the more qualified buyers who see your house early in the listing, the greater the liklihood of getting a good offer, provided you have priced it competatively.
And, since Realtors are paid on commission, the more attractive the commission the more motivated they are to show your property. If there are 2 properties very similar, and one pays half the commission, guess which one the Realtor is going to push?!
Real Estate Coach · Grand Rapids, MI · Member since 2008 · 204 posts · 188 votes
19y
I have sold alot of homes to investors as a realtor, and speaking from experience, the ones that make it worth my while I treat the best. Prior to buying most of the homes myself, if I found a great deal, I would send it first to the investor that I knew would list with me at full commission when the rehab was completed, then I would go to the guys that tried to beat me up, then to the fsbo guys. So were the fsbo guys and commission cutters saving a commission, maybe a commission but while they were saving pennies they were losing dollars
Investor · Willis, TX · Member since 2008 · 60 posts · 3 votes
19y
Originally posted by "esnuts":
I have sold alot of homes to investors as a realtor, and speaking from experience, the ones that make it worth my while I treat the best. Prior to buying most of the homes myself, if I found a great deal, I would send it first to the investor that I knew would list with me at full commission when the rehab was completed, then I would go to the guys that tried to beat me up, then to the fsbo guys. So were the fsbo guys and commission cutters saving a commission, maybe a commission but while they were saving pennies they were losing dollars
Well said. If you pay a Realtor full price and treat them like they deserve it, they will bring you deals first, which means more for the investor.
don't pinch pennies with a good realtor. that might be good in the short-term but not in the long-term. aren't there any flat-fee listing services? i've used click-it 21 which is part of century 21. it costs $500 flat to get your property listed on the MLS where all the realtors can see it and sell it. you pay the buyer's agent a commision 3% or so but you save the other side of the commission except for the $500 one time flat fee to get the house on the MLS.
Real Estate Broker · Jacksonville FL & Middletown, CT · Member since 2008 · 1k+ posts · 633 votes
19y
I decided not to even ask...oddly enough she offered - only 1/2 of a percent but hey - I'll take it. I have bought 2 properties from her already and now she has two of mine listed, so I suppose I'm worth a little something extra. Plus I'm easy. I got a yes or no 5 minutes after I walk through a property, and my listings are an easy sell.
The sellers agent does nothing for you. They spend 10 minutes to type your information into the MLS. Then it's like a 98% chance that the buyers agent will do the work of selling the property to their client. Your realtor does nothing when they list a property. So therefore try to find out if there's what's known as a "Flat Fee" realtor in your area. That's one who will list your property for a flat fee. Usually saving you huge in commissions. You still pay the full buyers agent commission, but at least you save like 80% on the listing (seller) agents commission.
The sellers agent does nothing for you. They spend 10 minutes to type your information into the MLS. Then it's like a 98% chance that the buyers agent will do the work of selling the property to their client. Your realtor does nothing when they list a property. So therefore try to find out if there's what's known as a "Flat Fee" realtor in your area. That's one who will list your property for a flat fee. Usually saving you huge in commissions. You still pay the full buyers agent commission, but at least you save like 80% on the listing (seller) agents commission.
WOW - Sounds like you've never been in the real estate business - or associated with a realtor that creates a significant income by "spending 10 minutes typing....". I have nothing agains reduced fee realtors but the bottom line is you get what you pay for. Reduced fee = reduced service.
Real Estate Investor · Las Vegas, NV · Member since 2008 · 1k+ posts · 447 votes
19y
Originally posted by "r2d246":
The sellers agent does nothing for you. They spend 10 minutes to type your information into the MLS. Then it's like a 98% chance that the buyers agent will do the work of selling the property to their client. Your realtor does nothing when they list a property. So therefore try to find out if there's what's known as a "Flat Fee" realtor in your area. That's one who will list your property for a flat fee. Usually saving you huge in commissions. You still pay the full buyers agent commission, but at least you save like 80% on the listing (seller) agents commission.
Wow, marketing a house takes a whole lot more than listing it on the MLS. With this market being as tight as it is a sellers agent who does nothing will sell nothing. It seems like you have a very poor view of real estate agents, maybe the ones you know are like that but I know quite a few who are true professionals.
Well I guess what tends to happen is that when they act to help you find a property they make their money most of the time, but when they just list it on the MLS which takes no more than 1 hours worth of time and they make five figures profit for that when it sells, that to me is rather easy money. But I guess both sides balance the equation right. But all I'm saying is that flat fee is out there and it's gaining popularity in this competitive market where FSBO companies are poping up everywhere and a great deal of people are using them.
Real Estate Broker · Jacksonville FL & Middletown, CT · Member since 2008 · 1k+ posts · 633 votes
19y
That may be the case in a hot market like you say you have in Canada, but it's not like that in the US anymore. The agents work nowadays. And not just the buyers agent, the sellers agent probably works harder in my local re market.
I find that hard to believe in any market, because the statistics are that 98% of the time a buyer is found either by the buyers agent, or by way of the buyer calling on the MLS listing and wanting to deal. It's very rare taht the sellers agent actually goes out and finds a buyer and brings them to the table, using any additional leg work other than the listing itself.
Real Estate Investor · Las Vegas, NV · Member since 2008 · 1k+ posts · 447 votes
19y
It's a lot more than just the MLS these days. Sitting Open Houses, flyers, newspaper ads, networking, virtual tours. An agent that I know will spend countless hours marketing and a lot of money on the things mentioned above. In a market that is this slow many buyers will blame the agent when the house doesn't sell and switch to a new agent when the listing expires leaving the agent with a return of $0 for the time and money spent. I don't envy the sellers agent one bit, you can quote statistics all day but that doesn't mean that they have any validity whatsoever in the real world.
Well when I sell a house I use "flat fee" and go by the stats which has always worked and saved me about 40% on commissions in the process. If you use a good realtor who does a lot of work for you that you're aware of maybe that's good too.
Real Estate Broker · Jacksonville FL & Middletown, CT · Member since 2008 · 1k+ posts · 633 votes
19y
My agent is busting her butt to make things happen...She's marketing the hell out my properties and dealing with the buyers agent isn't always an easy task. I'm dealing with two PIA buyer's agents right now and my agent is at bat for me 24-7. She's on call constantly, she never misses a beat, she WORKS to get my property sold. She's the sharpest tack in the box. I almost feel embarrassed to have even thought of asking her for a discount. She's worth every cent. And in a market where properties are running a 45-90 marketing timeline, mine are about to be sold in less than 30. Cause I have the right agent.
Maybe 3 years ago when I could put a sign on my lawn and the next day I'd have 10 offers to pick from that wouldn't be the case, but the market is what it is TODAY.
Real Estate Investor · Las Vegas, NV · Member since 2008 · 1k+ posts · 447 votes
19y
That is so true. I have had buyer’s agents who didn’t have a clue messing up deals. If there is an easy end to the game it would be walking buyers around to properties that agents have worked hard to market. I had one buyer’s agent who caused a major panic in my agent’s office. On the eve of the closing she called with a laundry list of things that were wrong with the property which caused a panic because it was unexpected, turns out she was talking about a different house. She was so far behind the times that she didn’t even use e-mail. In my experience it is the buyer who tends to be represented by “aunt Millie” who happens to have a real estate license even though she hasn’t sold a house in years.
Residential Real Estate Agent · Dayton, OH · Member since 2008 · 70 posts · 1 vote
19y
Originally posted by "r2d246":
I find that hard to believe in any market, because the statistics are that 98% of the time a buyer is found either by the buyers agent, or by way of the buyer calling on the MLS listing and wanting to deal. It's very rare taht the sellers agent actually goes out and finds a buyer and brings them to the table, using any additional leg work other than the listing itself.
1st, its more expensive for an agent to list a house. There's the sign, lock boxes, adds, etc.
2nd, it all evens out. Statistically your listing agent does not find your buyer, but it evens out as he/she is not sitting on their butt, they are also out working with buyers that will buy your house or someone else's house. The buyers agent that finds a buyer for your house also likely has some listings of their own. That agent may have gotten your buyer because he called him through a sign at one of his listings.
3rd, the listing realtor will represent you when dealing with offers from buyers. You may not need this, but many do. Also, a lot of buyers do not feel comfortable dealing directly with a seller, so you might lose some potential buyers just for that reason.
4th, good listing realtors can head off a lot of problems, keep you out of legal trouble, deal with appraisers, be there for inspections when you can't, keep they buyers loan apps moving, etc, etc, etc.
5th ....There's nothing like meeting up with my sexy milf listing agent so that we can do some private up close and personal negotiations in the back seat of my car ;-)
Residential Real Estate Agent · OH · Member since 2008 · 553 posts · 24 votes
19y
Originally posted by "r2d246":
The sellers agent does nothing for you. They spend 10 minutes to type your information into the MLS. Then it's like a 98% chance that the buyers agent will do the work of selling the property to their client. Your realtor does nothing when they list a property. So therefore try to find out if there's what's known as a "Flat Fee" realtor in your area. That's one who will list your property for a flat fee. Usually saving you huge in commissions. You still pay the full buyers agent commission, but at least you save like 80% on the listing (seller) agents commission.
I have a home listed in a subdivision that is going to have a neighborhood yard sale on May 19. The home will be open for 6 hours-- I will be there the whole time. Snacks and drinks in the home-- paid for by me. Advertising to make sure people know about the home being open on Saturday--paid for by me. Lender in the home to pre-qualify people on the spot for 6 hours-- calling in a couple favors owed.
Please don't tell me that all it takes to sell a home is putting it on the MLS and sitting back
By the way, no I don't get paid a dime until this home sells.
Do you think that whole "flat fee MLS" idea is gaining momentum or dying off? Here we had a place that offered that. Now they closed down. So I can no longer get the big discount through them. But a friend of mine told me she would list for half of 1% which means I save about 33% on my listing costs, but whether she'll stick to that or not at some point in the future is hard to say. And I think the reason that company didn't make it is because realtors wouldn't get paid very much for their list of listings as sellers agents. Where as normally I'd think that all a realtor would have to do is find the product and be able to get it under contract, and if they found enough product then other realtors would then move it for them.