What’s the question on everyone’s lips? How’s the market? So, how is the market? It’s up, it’s fast, it’s strong, and it’s a seller’s market. Seller’s market means low inventory higher prices and much more competitive offers. In fact, majority of sellers are selling their homes for the asking price and higher. The more this information travels, the more people will stop thinking about selling their homes and start to sell them.
Next comes a pitfall that just about every seller has had to deal with: commissions. The problem, with selling your home using a realtor, is that it comes with a cost. While there’s no standard, 6% is pretty typical to see. Here’s the commission breakdown: 3.2% goes to the listing agent, and 2.8% goes to the buyer’s agent.
Sellers tend have issues with paying commissions to Realtors. Many wish to sell their home and make top dollar, but no one wants to fork out 6% in commissions. It might even seem like you are throwing money away. Then along comes a system to sell your home at a flat rate instead of a percentage based system; Flat Rate Fee Companies. While this might feel this will save you money on commissions, this system is the worst way to sell your home, even if you save a couple of bucks.
Flat Fee Companies charge a flat fee for putting your home in the MLS. Then they will either ask you what you would like to pay the buyer’s agent or give you an idea of what other sellers are paying buyer’s agents; this is the 2.8% commission. The flat fee strictly covers putting your home into the MLS and doing the contract work for you. They do not market your home. They do not represent you. They do not guide you through the home buying process. If they were to do all these things, they’d charge you a commission. However, since you are opting out of paying for the full fiduciary responsibilities of an agent, they are not providing you with those services. Services that are invaluable in today’s market.
Most sellers will tell you they think their home is worth X when in reality it is worth Y. When an agent tries to explain this to a seller, they do not wish to hear it, and the agent will not get the listing. Flat Rate Fee Companies will not disagree or discuss price with the seller. The seller will set the price, and the agency will move forward with that price. Because they do not represent you, they will not coach you on what price is accurate for the market.
Flat Rate Fee Company homes are always the last homes to sell. Since there was no marketing done on the home, there’s no traffic being driven to the property. Because the home might be higher priced than what’s on the market, other agents will tell their clients that the home is overpriced before ever seeing it. It sits there and goes stale. Sooner or later someone will offer a lowball offer because the house has sat on the market so long, or the sellers will opt-out of Flat Rate Fee Companies and have a Realtor to sell their home faster.
When selling your home, you want the highest price possible in the least amount of time. Isn’t this worth the 6% commission that comes with the deal? Don’t you want a Realtor that will market your home to the fullest and drive the most buyers to your property? Don’t you wish to use someone that will tell you that your home might be overpriced or underpriced? Don’t you wish to sell your home in the fastest amount of time possible? If you’ve answered yes to any of questions above then, contact The Colorado Dream House Team for a free marketing consultation before you decide to sell your home using a Flat Rate Fee Company.
Marc Bayes is a Broker Associate with the Colorado Dream House Team, Keller Williams Realty DTC. Follow us on Twitter, Like us on Facebook, Watch us on YouTube, Questions? Contact Marc at 303-619-3052