By Walt Harvey (R), ABR, CRS, GRI, SRES, ePRO, QSC
Everyone wants to save money and home sellers are no exception. Ads promising to sell your home for $3500 can be seductive. When home prices soar and desirable properties sell in days, home sellers may question the value of traditional brokerage service. Flat fee or limited service companies, sometimes referred to as discount brokers, offer an alternative but is it the right choice for every home seller?
Most sellers want the most money they can get, as quickly as possible with the least amount of hassle. If all things are equal, a savings on the real estate fee or commission should put more money in the sellers’ pocket at closing. But did the seller save or did they loose money?
Real estate values are driven by supply and demand. When the demand is high prices go up because there are more buyers seeking fewer homes and the buyers compete against each other and bid up the prices. But what if buyers are unaware a home is for sale? Most buyers are using the services of a real estate agent to assist in their home search. Agents search the Multiple Listing Service (MLS) where sellers’ agents offer to co-operate with buyers’ agents and share the commission. A property that’s not on the MLS with an offer of co-operation is a property that’s off the radar to 4500 real estate agents and their buyers. Plus, if a property is not placed on the MLS it will not be on Realtor.com, another popular site that buyers search.
Considering selling your home, with a $3500 selling fee? Be clear on what services you’ll get. How motivated will that broker be to negotiate on your behalf when they’ll get paid the same regardless of the final price? Ask if you’ll have MLS and Realtor.com exposure. Unless you’re willing to pay an additional fee to a buyer’s agent, it’s not likely. Without MLS and Realtor.com exposure, you may not be reaching buyers for your home that can bid up the price. You may save money on the commission but lose far more in the process. Do the math!
Walt Harvey is a real estate broker with East Oahu Realty and is Quality Service Certified®. Walt partners with his wife Arla and together they specialize in residential, commercial and investment real estate. You can reach them on their website: www.coastalhawaii.com. Real estate question? E-mail them: walt@coastalhawaii.com or call 375-8959.
Published in Small Business News May 2005