Trying something new to sell Real Estae?
November 72010
I have NO clue why Realtors charge as much as they do to sell a house..
I am thinking about doing a programs that is :
I charged $500 upfront + (1/2) of 1% of the sales price (in addition they still are responsible for 3% buyers agent)
For example on a 300k home:
Traditional Cost: 9k (me) + 9k (buyers agent) + 5k buyers closing cost = 23k
My Way: $500 (upfront fee) + 1500 (1/2 of 1%) + 9k (buyers agent) + 5k (closing cost) = $16000
My way = Total Savings of 7k
Do you think people would consider this method?
The upfront fee would cover some my out of pocket expenses such as signs, electronic key’s, advertising etc
I did do a little research and there is someone in my state that does this but she her upfront fees are a little more . Although this month alone she got 98 new listings and since last year around this time she has gotten 958 total (not including the one’s that sold)
What are your thoughts?
Maybe I should have mentioned I am a licensed agent.
I pay my broker $85/month. For access to the two MLS services. My company also host my website (included in monthly fee), telephone, by the way the electronic key is a one time fee since I am a member of the MLS. I only have to pay for my personal key so show homes. Also my broker will only not more than 30%. My continuing education is FREE . My broker host clases 2-3 times a month for this
Our listings are sent out to over 750 websites (and counting).
Of course there would be a disclosure that states we cannot guarantee a home will sell but we will continue to try until it is sold.
please contact me through here if you have any additional questions…
I am only 20 so all the info I can get will help out a lot
Thanks
there are a couple companies in my state that does this but they really do not do much sales. Mainly because they are internet based and there is no physical office (besides the a real estate agent that does this on the other side of the state) and the other agents are not really "known" agencies I am with a nationally known company which i think will help
Check out http://Redfin.com and http://Ziprealty.com
They already have a discounted program that works.
November 7th, 2010 at 7:03 pm
There are lots of companies doing a flat fee listing … typically $2000. The $500 is not nearly enough to pay for an MLS listing, advertise in the paper, make fliers, signs, etc. But I do agree that realtors making 6% total is way too much with all the websites that people can access.
Good Luck!
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November 7th, 2010 at 7:14 pm
So whats your problem/question – will this work – of course – will you be as successful as the other realtor who is doing this? maybe – maybe not!
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November 7th, 2010 at 7:41 pm
Check out http://Redfin.com and http://Ziprealty.com
They already have a discounted program that works.
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CA Mortgage Loan Officer and RE Agent
November 7th, 2010 at 8:26 pm
In most states you are required to have a real estate license to sell a home other than your own. Otherwise, you could be charged with practicing real estate without a license. As for the amount we charge for commission, this covers such fees as the required amount we pay for our MLS dues which is where we advertise our homes. In addition, most realtors also have to maintain and pay for their individual websites and we also pay to list homes on other websites. I advertise my listings on over 100 websites. We also cannot charge a Seller an "upfront" commission b/c if their house does not sell, we do not get paid. An if you are not aware, most realtors have to pay their brokers a % of their commission, sometimes as much as half, also they have office rent, telephone fees, marketing fees and make several trips out to the home for showings. There are a lot of fees that realtors pay that maybe the general public is not aware of. They think it’s as simple as putting up a For Sale sign, signing a contract and collecting the commission. We also have to have Liability insurance to protect against lawsuits. We are required to maintain a certain amount of education credits to keep our license active. The electronic key you mentioned comes with ongoing fees also. What would you do if someone you were selling a house for decides to sue you? Are you familiar with the Disclosure laws in your State? If not, you are asking for a lawsuit. Would you be covered if you are sued? All of these expenses are what comprise the commissions that are charged.
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Licensed Real Estate Agent in the State of Virginia
November 7th, 2010 at 8:44 pm
Do your state require you to have a real estate agents or broker’s license to act as such an agent.
There are many flat fee real estate brokerage agents that are currently doing the exact same thing at a much reduced rate.
Why would a person want to include a buyers commission into a listing especially if they are attempting to get as much of their equity in their pocket as they can. The do not want to pay any agent be it sellers or buyers agent.
The can save the entire potential you are proposing by using a local mortgage broker when the buyer contact them about the mortgage loan to purchase the property.
You should contact a local flat fee real estate shop and find out their cost as if you were selling. This would give you an insight as to what they charge as they do not include a buyer’s agent commission. This might put you at a disadvantage.
Then there are a few smart mortgage brokers that would perform the same services free as long as they are allowed to get the names of the potential buyers that come to the property on open house.These mortgage brokers take the seller through the entire process from the offer to the closing using their service providers.
I think you might have a good idea, however, you might revise a few of your figures as most For Sale By Owners (FSBO) are attempting to put more money into their pockets as oppose to paying a potential buying agent which they did not sign a contract to pay.
What would happen if the property did not sell? How long would you be willing to list the property.
I don’t think a mart savvy FSBO would be impressed with this type program as they have access to the MLS for about $199.00 or so, Internet access, mortgage brokers that will perform these same services free.
If there is a person in your area currently doing this there must be a need for the service, therefore with additional research you might be onto something akin to what the flat fee brokers are currently doing.
I hope this has been of some benefit to you, good luck.
"FIGHT ON"
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November 7th, 2010 at 9:26 pm
lets break this out.
On a 300,000 listing, your broker would earn a grand total of 2,000. Lets say that you have a 75/25 split with your broker, then the broker earns $500 and you earn 1,500. These are GROSS numbers.
Of this 1,500 you can figure around 600 for marketing, gas, and other expenses. Yes, there is the internet, but there are also other costs.
Lets look at just your time. On average, you will spend around 50 hours listing and servicing and settlement of a house. If you have only 900 income for 50 hours work, this works out to $18 a hour. Not bad, but there are a lot of other jobs were you can earn more, pay less taxes, have benefits etc.
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November 7th, 2010 at 10:03 pm
I think if you have a visible walk-in office you will definitely get noticed– and a thriving business– You go girl– Make me proud
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