Discount realtor for selling house? (sale, real estate market, rental)

[Topaz]

We may have an opportunity to pursue a job out-of-state and will be in the position of selling a house only a year after buying it. The real estate market is lousy and we are worried that we may lose a bunch of money on the house, especially given transaction costs. So I am considering hiring a discount real estate company to help us sell (the type that still pays the buyer's agent 3% so that no one boycotts the house). Has anyone had experiences with companies like Assist-2-Sell or Help-U-Sell? I'd love to hear both good and bad, both recommendations and warnings.

Recommendations for good stagers are also welcome...

Thanks!

[Vision67]

Have you considered doing a FSBO? I sold my own house by owner several years ago in only 3 days. I hired a real estate lawyer for $300 to do the paperwork.
This is what I did:

1. Get a professional inspection
2. Correct the defects
3. Get an appraisal
4. Set a price about 3% below what a Realtor would set
5. Hire a lawyer to do the paperwork. Don't sign anything without his approval.

If it fails, you can always hire a Realtor.

[Topaz]

Vision67, I definitely considered doing that but then I became worried because a friend who is a realtor said that if your house is on the market longer than 14 days, it becomes "tainted" and realtors won't bring anyone to look at it then. That made me think I'd better do things right the first time and get the house sold quickly.

I'm also not sure how I could do Open Houses myself since I have children and my husband might already be gone for the new job by the time we sell. I guess I could hire an "as needed" nanny for less than it costs to hire a real estate agent...

When you did a FSBO, did you still pay the buyer's agent 3%? Or did you find a buyer who didn't have an agent so you saved money on the commission?

Topaz

[2bindenver]

There is no such thing as a standard commission so there is no such thing as a discount realty company. Every company/brokerage sets their own fees.

How about renting or rent to own since there is not a lot of equity? Wait for the market to improve.

[Topaz]

2bindenver, in all the geographic areas where we have lived, the standard commission was 6% and it was rare to negotiate something lower. That is changing now as more people negotiate a different percentage.

We put 20% down when we bought the house, so there is actually a fair bit of equity. If we don't get the equity out, we would be renting a house in our new location and managing a rental property a thousand miles away.

I looked into doing a lease option ("rent to own") because it seems like you'd get better tenants that way, but the "due-on-sale" clause scared me. I know most real estate investors don't really worry about that, but I'm not sure why they don't. If interest rates rise, it would seem like lenders might be motivated to enforce that clause more. The way I read the clause, any transfer of interest, including a lease option, would trigger the clause and the lender could call in the loan. That would be financially disastrous for us.

[bashep]

Hey there-

I am a realtor and I do not agree w/ what the other realtor said. I don't even look to see how long a house has been on the market when I am trying to find a house for a buyer. To me, the longer on the market, may mean more negotiating room for price, that is the only thought that crosses my mind. I just look for the house that would fit my clients needs the best, no matter how many days on the market. I have not heard anything bad about Assist-to-Sell. In this market, I would be hesitant to do FSBO if you are needing to sell fast. Only because you do not get the house listed in the MLS, which is where most of your showings would come from. However if you are in a desirable neighborhood, my dad sold his house w/ one open house, FSBO, about 2 months ago here in the Springs. Just my thoughts though.. I was a homeower before a realtor, so I know the struggles of trying to decide how to sell. bashep

[Topaz]

Thanks, Bashep - I like your data better! The first realtor scared me.

I definitely realize the importance of the MLS - there are services that say they will list your house in the MLS for $300-500, and I was going to do that if I tried a FSBO.

I'm trying to balance a quick sale with reasonable transaction costs - I'm sure that's what all sellers are trying to do! I've never sold a house in this type of market so it will probably be a challenge - I like our neighborhood but there is a ton of competing inventory.

I appreciate all the thoughts - thanks, everyone!

Topaz

[BenWolfe]

In a slower market it takes a lot more than a sign in the yard and entry into the MLS to sell a house. You need a good real estate agent who specializes in your area and know how to market a property and expose it to the most buyers possible.

I have personally listed numerous properties after they had been listed with Help-U-Sell and Assist-To-Sell for 6 months or more without selling. Several of my clients who had been listed with these companies complained about the lack of showings and limited feedback from their agent.

Personally, not speaking as a Realtor, I believe that a good top producing Seller's agent is worth every penny of the 3% you pay them (the other 3% goes to the Buyer's Agent). And you will often net more than you would have by using a discount firm.

[tfox]

Realtors will always tell you to go with a realtor. However, it is very possible to sell FSBO AND get on the MLS, which is where 90% of your traffic will come from. Simply look for a flat-fee MLS listing, which means you pay a few hundred bucks and you're on the MLS -- except for instead of the buyer's agent calling your agent -- they call you. These options are really far better than Help-U-Sell since it's about a tenth of the price and you're on the MLS that way.

I think it's a good option if you're willing to do your homework and your own marketing. A good agent certainly can help you and a few are definitely worth their 3% commission, but many of them are worse than worthless -- and some are corrupt, which is even worse than that.

On the other end, there are a few crooked buyers' agents that won't show your house when they see it's a fsbo -- but most will, because they rightly look out for their client's best interest, plus avoiding fsbos is unethical. There are a lot of good agents out there who want to find the right house for their clients and would be happy to work with you. It is important that you make it very clear to the buyers and the agents that you will pay the full realtor's comp.

I think the biggest mistake that fsbos make is they tend to price the property too high to start with (thinking that they might negotiate down later), then they tend to drop it too quickly once they get frustrated at the house not selling -- the end result is that they end up settling for less than they could have. A better option is to try to price the house very aggressively at first (think -- how low would you be willing to go?) -- which will generate more traffic, but then have patience and let the house be seen by enough buyers to get the right offer. Pricing a house is tricky, having sold a number of houses myself (fsbo) -- I know that one of the main benefits that a good realtor has is the experience in knowing how to price a house -- it's harder for people like you and me so you have to do your homework.

[Topaz]

Tfox - thanks for the thorough reply. I agree completely about pricing the property aggressively because in the past when we did that, we ended up with offers over the listing price. Here, we don't expect that to happen because of the soft market but I do realize if we overprice the house, it could sit on the market for a year without selling.

BenWolfe - what do full service realtors do to help market the house? I've been reading Web site after Web site and the marketing language is so vague, I can't figure out the true value. All the claims sound alike, which makes it very difficult for a consumer to know the best path to take. Articles aimed at consumers basically argue two different points-of-view. The first is that if you pay full commissions, you failed to negotiate well and you are just stupid. And the second is that if you pay less than the standard commission, you get what you pay for and it won't be much.