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I did all the work you metnioned above DESPITE having a listing agent that was supposed to do it FOR me. So when I closed I paid TWO BROKERS commissions even though I, the seller, did 99% of the work I was responsible for.
Could you outline the work you did, type of agency agreement you had and what was the pay for the service you say you didn't get?
I had my house listed with a realtor and the results were terrible. Now I am going FSBO. I actually got a letter from another real estate agency that stated it would be impossible to sell my house because all RE agents would boycott it.
I certainly don't understand this because there is no cost to any realtors. I am offering 3% payable at closing. Don
I agree the letter was stupid and uncalled for. I don't understand all the FSBO vs Agent ideas either. If you have a car that needs fixed, you either fix it yourself and save the money or you hire someone to do it. You either boondoggled the car and made a bigger mess of it, or you did a good job. It's your chance to take.
I see the same for RE. We're here if you need us, but good for you if you don't.
I have also been approached by FSBO's to ask me to sell their house, they would not list, but "just" bring them a buyer for 3%. I guess I've not come across that bridge often enough to understand the mentality behind all those threads of why 3% is just fine and dandy to "just" bring a buyer. I find a buyer, $$ out of my pocket, do the deal to closing. Nahhh, I'll do it for the full commission rate. I don't think I'm in the same real estate world as most that post here. I just can't see it. Yes, I'll show anything my buyer wants to see and sometimes even fsbos if it's needed. But that whole mentality, "just" bring me a buyer I've just not understood yet. I'm in the business to find buyers, that's why I get hired to sell. It's like saying, I don't want to hire you, I just want you to do the job for half price, isn't something better than nothing?
You can fix my car but come to my house to do it so I'll only have to pay you half price. Beats me. Guess I need enlightened here.
I understand the poster has an atty to do their legwork, but who does the buyer have? There is still the liability, liability, liability for the agent anytime they touch a deal. Pay me full price to take on that liability.
Don, I willl always show a FSBO if a I have a signed Buyer Agreement and the Seller is williing to reimburse an Agent. 3% sounds good to me and it seems as though you do have your bases covered (with the atty). FSBO's in general, though, do not. BA's end up not only doing their own work but also that of the Seller. I don't think it's a boycott but rather a "is this going to be worth even the the 3%?.
My market is much small, though, than say Florida. We have very few FSBO's so they're easy to keep up with. Other areas have hundreds of FSBO's and it's impossible for the Agents to keep up with what's available in that market, if they're not in MLS. It's just logistics and if the MLS is saturated but centralized they're not going to go looking for FSBO's. Even searching the FSBO sites is a nightmare. No centralized information, the listings are not maintained by either the site managers or the sellers. I've found FSBO's on those sites that sold a year ago, through an Agent, and they're still listed as active in the FSBO site. Not worth the time or effort.
THAT is why your house will receive little to no attention from Agents.
This is NOT always the case. I did all the work you metnioned above DESPITE having a listing agent that was supposed to do it FOR me. So when I closed I paid TWO BROKERS commissions even though I, the seller, did 99% of the work I was responsible for. THIS time I have an MLS listing and I'm saving myself the commission I'd pay a listing agent,(consideringhow little I got out of the investment the last time).
What is 99% of the work? Are you claiming you also did the job of the buyers agent? You didn't pay 2 brokers. You paid one broker and your chose to pay the other broker through the cooperating MLS agreement.
Why don't we show FSBO's? Most of the time we never even knew your home was for sale. If we know it, and it fits, we show it.
An agents job is to market a home and guide it to closing. That's it. We aren't magic bullets or sales people. The home must sell itself to the buyer, we can't make people look or make offers.
Lastly there are 5 equal reasons a home sells.
1-Condition (Seller controls)
2-Terms offered (Seller controls)
3-Price (Seller controls)
4-Marketing (Agent Controls)
5-Location (buyer controls-they determine value of the area)
So, 60% of the burden of selling a home falls on the seller. That being said, it's not always the owner's fault the home didn't sell.
I'm not a realtor but I really do question the need for one for an experienced home buyer who is buying into a neighborhood he understands and has been "following the market" in the real estate section of the newspaper for months on end. It would seem having a good real estate attorney is a better way to spend the money to protect and to guide you in the nuances of selling/buying real estate. Here's my take on why you don't really need an RE these days, when buying:
1. Search on the internet yourself. That's what we did and found our place only to bring it up to the attention of the realtor.
2. Get pre-approved for the mortgage.
2. Get a good real estate attorney. yes, they are expensive but they so worth it. In general you don't need them for more than 2-4 hours of their time as well.
3. Get a good home inspector.
4. Know the market well or pay couple hundred bucks to a fixed-fee agency to do a CMA for you. This isn't some rocket science either. Most MLS interfaces basically ask the realtor to input some basic criteria (beds/bath/garage/patio/etc..) and the basic location, and out comes the houses sold recently. If you know your market, you shouldn't really be surprised from the CMA's results.
5. Make the offer and play the requisite 2-3 times back/forth with offer/counter-offer.
6. Make the offer contingent upon something, anything (have to sell my old place, my parents/dog/1-year old must approve this sale, etc.), so you always have an out in case you change your mind.
7. Put that home inspector to good use.
8. Notify the attorney and buy an hour of his time so he can guide you through any legalese.
When selling, you unfortunately are going to have to deal with the buyer's real estate agent but you don't really need a listing agent (there are some exceptions like when you just don't have the time, etc..).
0. Know the market or pay for the CMA to aid in pricing.
1. Pay a fixed-cost agency to list your house on the MLS. This is a must. Going full-monty on the FSBO, while commendable, isn't recommended. GET ON THE MLS. Pay what you need to to get that done! It can't be said too often. The realtors have a monopoly on that one critical resource unfortunately, so pay what you need to (still be chump change compared to saving 2-3% on your house) to get on the MLS. Write your own copy. Read couple of Sunday's worth of newspapers to get a feel for what you need to say and what you shouldn't. (E.g. "vintage" is usually code word for old; "cozy" is usually code word for cramped; "charming" is usually code word for crap, etc..)
2. Offer a co-op of 2.5% to 3% on your house. Make sure that co-op shows up in the all important co-op column in the MLS.
3. Market your house by advertising on couple of paid internet (realtor.com, etc..) and free internet (craigslist, etc.) sites.
4. Put a sign in the front of your lawn.
5. Advertise open houses in real estate section of the newspaper. Nobody buys from a newspaper anymore but many may get their only notification of an open house from a newspaper.
6. Be ready to sign any agreement with the buyer's agent to put their mind at ease about the co-op. Be respectful of their time and their client's time.
7. Pack away at least a 1/3 of your s*ht in boxes to open up your place. Put the boxes in storage, preferably away from your garage.
8. Clean your house thoroughly and try to maintain. The key is to open up the rooms by removing clutter as much as possible. Paint where needed.
9. Negotitate the offers, read every last word on the contract sent to you by the buyer's agent and don't sign it until either you are satisfied or your attorney (buy another hour) as looked at it
10. Show up at closing to collect the dough )
My prediction is that in the next 10-20 years, RE agents are going to go the way of travel agents; only to be used in emergencies or extenuating circumstances but not really needed for the day to day.
Desi, nice post.
When you're buying, what are you using a RE attorney for?
Sounds like a lot to do when ya get home from work.....
Hey! where's the part about negotiate repairs!
Unfortunately, you have to do most of that stuff yourself, whether you have an agent or not.
If you don't do your own search, for example, you won't find out about FSBOs, or discount listings. According to NAR, FSBOs are much cheaper than other listings, so you could be losing a lot by not seeing them. You also won't know if your buyer's agent is steering you to her own listings, or to listings with secret buyer's agent bonuses, unless you learn the market yourself.
Getting pre-approved for a mortgage is also something you have to do for yourself - your agent isn't going to do that for you.
As far as inspections, appraisals, escrow, etc., you need to choose those people yourself, regardless of whether you have an agent. Many times they pay kickbacks, or referral fees, to agents who recommend them. If you let your agent choose these contractors for you, many times you'll pay more than you need to.
Also, many inspectors and appraisers understand that if they do something that holds up a transaction, they're not likely to get another referral from that particular agent again.
Which could be bad news for you, if you're relying on an inspector or appraiser to tell you the truth.
Unfortunately, you have to do most of that stuff yourself, whether you have an agent or not.
If you don't do your own search, for example, you won't find out about FSBOs, or discount listings. According to NAR, FSBOs are much cheaper than other listings, so you could be losing a lot by not seeing them. You also won't know if your buyer's agent is steering you to her own listings, or to listings with secret buyer's agent bonuses, unless you learn the market yourself.
Getting pre-approved for a mortgage is also something you have to do for yourself - your agent isn't going to do that for you.
As far as inspections, appraisals, escrow, etc., you need to choose those people yourself, regardless of whether you have an agent. Many times they pay kickbacks, or referral fees, to agents who recommend them. If you let your agent choose these contractors for you, many times you'll pay more than you need to.
Also, many inspectors and appraisers understand that if they do something that holds up a transaction, they're not likely to get another referral from that particular agent again.
Which could be bad news for you, if you're relying on an inspector or appraiser to tell you the truth.
Where did you read that? Every FSBO I've seen, the sellers were way overpriced and were basing their price on what other homes in the neighborhood were priced at, not on sold prices.
Unfortunately, you have to do most of that stuff yourself, whether you have an agent or not.
If you don't do your own search, for example, you won't find out about FSBOs, or discount listings. According to NAR, FSBOs are much cheaper than other listings, so you could be losing a lot by not seeing them. You also won't know if your buyer's agent is steering you to her own listings, or to listings with secret buyer's agent bonuses, unless you learn the market yourself.
Getting pre-approved for a mortgage is also something you have to do for yourself - your agent isn't going to do that for you.
As far as inspections, appraisals, escrow, etc., you need to choose those people yourself, regardless of whether you have an agent. Many times they pay kickbacks, or referral fees, to agents who recommend them. If you let your agent choose these contractors for you, many times you'll pay more than you need to.
Also, many inspectors and appraisers understand that if they do something that holds up a transaction, they're not likely to get another referral from that particular agent again.
Which could be bad news for you, if you're relying on an inspector or appraiser to tell you the truth.
Where do you come up with these things? It is illegal for agents to receive any kind of referral fee or kickback for using particular escrow companies, inspectors, etc. The most I have gotten from anyone is a thank you note and a $5 Starbucks card! Inspectors and appraisers are licensed professionals too, and won't risk losing their license over doing a favor for anyone. Also, regarding appraisers - they are selected by the lenders, not the real estate agents. And even then, they are on a rotating schedule so as not to use the same one over and over again. Consumers are always welcome to choose their own inspector and lender but when they don't know who to select, a real estate professional is a great source of referrals. We know who does a good job and will take care of their needs. That's part of what makes a successful real estate transaction -- having quality professionals available every step of the way.
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