1. Savings. This is probably the biggest drive for sellers to go non-traditional, the reward far outweighs the risk (which really, is the same risk you take when choosing any real estate agent to sell your home). In a world of technology, why are we paying the same thing we did before we had internet? Every aspect of the sales process is easier than ever before…marketing, communication, contracts, yet we’re still paying the same commission as 1975. WHY?
Listing commissions today are inflated. I am a licensed real estate broker and I believe that statement whole heartedly. Example: I listed a home in a popular community, the sellers met with me after meeting with a well respected agent who wanted 3% to list their home. They asked many questions about what I offered, and decided pretty quickly to list with me. We received 2 full price offers in 3 days.
Would a traditional listing agent have earned $9000 for this sale? Certainly not.
Do all listings end up like this? Certainly not.
This home was priced well, partially due to the sellers not having to spend close to $10k to list it. It’s all about the win-win for the seller and buyer.
2. Negotiating power. If your bottom line is X, and you’re not paying a listing agent 3%, does that not give you an extra X THOUSANDS of dollars of room to negotiate with your buyer? The beauty of a flat listing fee is the buyer reaps the benefits as well. After all, the two most important people in a transaction are the buyer and seller, shouldn’t they walk away happy before the sale professional takes his check?
3. Equivalent or better service. Nothing changes except the size of your bottom line. When hiring a real estate broker, you’re making an informed and educated decision. You might (or should) interview several before you find one that feels like a good match. If you compare the services being offered, you’re not sacrificing anything by choosing a broker who understands the value of the sale and just so happens to not charge an inflated commission to get you to the closing table.
Flat fee listing models are growing in popularity all over the country, successfully I might add. It’s taken a long time, and will continue to, but I believe the commission based listing (and maybe even selling) side of real estate will eventually convert completely to flat fee. If we look at other parties involved in the transaction- title company, attorneys, inspectors…they all have a flat rate for service. Among everyone involved, buyer’s agents are most deserving of a commission based paycheck. They have what you need- the buyer. They are selling your home, listing agents are marketing your home. The great ones do both.