The Truth About Traditional 6% Realtors
Why you might consider listing with a 6% Realtor
by John Prell
We’ve discovered that our clients become our most vocal advocates once they experience the ease of the flat fee listing process. However, there are some people who aren’t familiar with flat fee MLS listing, and still look to traditional real estate agents to sell their property. Someone might consider listing with a 6% agent if:
- They weren’t aware of the flat fee listing option
- They don’t know anything about the real estate industry, or what Realtors do for their clients
- They like the marketing pitches made by traditional agents (see details below)
- They aren’t concerned about saving money
Because of the informational resources we’ve made available to our clients, there is absolutely no necessary part of the home selling process that we don’t provide, and with a much lower price tag!
In truth, you’ll actually be more pleased with your home selling experience when using our flat fee services because you could potentially sell your home faster when listing with us! Of course, the most important factor in selling your home is price. When listing your home with a 6% Realtor, you must price your home high enough to cover their commission. If you didn’t have to pay those commissions, you could sell your house for less, or simply pocket the profit.
Sales Talk vs. Reality – Find the Truth in Traditional Agent Sales Pitches
Hopefully, as you’ve explored this website, you’ve discovered that what some 6% agents might tell you regarding real estate isn’t always completely true. We hope that with this education, you’ll choose a flat rate listing option instead of wasting money with a traditional agent. Here are some typical agent sales pitches, and the reality that accompanies the pitch.
The Line: Our company has been in business for years, so buyers will want to purchase homes that we’ve listed.
Reality: Buyers have absolutely no interest in what real estate company has listed a home; their only concerns are the property attributes.
The Line: If you use a flat fee or discount brokerage, no agent will show your home to their clients.
Reality: As long as you’ve followed the advice on this site (use the real estate sign from your broker and don’t indicate that you’re the home owner in other property marketing like flyers or Craigslist), no one will know that you’ve listed with a flat fee organization. Your listing will be identical to the traditional 6% agent’s listings.
The Line: If a potential buyer calls about your home, we’ll get them over to see your home as soon as possible.
Reality: There’s always an agent on phone duty in a real estate office. They get every incoming lead, which is what a potential buyer will be treated as if they call the listing agent’s office. The buyer may get some basic information about your home, and will then be grilled by the agent on duty: “When are you looking to move?”, “Do you know what your price range is?” and “Will you be selling the home you’re in now?” The fact is that your traditionally listed home offers the same commission as any other home, so an agent has no incentive to sell your home specifically.
We suggest that you actually call a listing agent’s office posing as a potentially buyer to see how incoming buyer calls are handled. You’ll be surprised.
The Line: I have a proven marketing plan that will help sell your home.
Reality: There is no marketing that an agent can do for you that you can’t do for yourself much cheaper, or that is relevant to selling a home at all. Some typical marketing methods:
Networking with Other Agents. Similar to claiming their company name has anything to do with whether a buyer wants your home or not, networking with other agents won’t help sell your home. Good buyer agents are utilizing the MLS to find their clients homes. In fact, if your agent is talking about networking, they’re simply looking for new listing clients, and not spending time working on your listing.
Printed Supermarket Book. As with all printed publications, the turnaround time on these pieces is approximately six weeks. Meaning that by the time a potential buyer looks at the book, most of the listings have been sold. Additionally, because of the limited property information shared in these publications, most buyers won’t waste their time looking through them anyways. Buyers are searching online
Emailing Other Agents. Real estate agents, just like regular people, hate spam email. So if an agent plans to spam other Realtors with your listing, you can plan on about 90% of those emails hitting the junk folder, and the remaining 10% of agents not showing your listing on the principal that they’ve been spammed with it. Agents will search through MLS listings, and MLS listings only, to find properties to show their clients.
Open Houses & Neighborhood Mailers. Open houses are most often attended by your neighbors, looking at your home to see how their home compares. Your agent knows this, and wants to host an open house for you to get your neighbors as clients. If you’d like to host your own open house, you certainly can! Similarly, mailers sent to your neighbors will do absolutely no good. Your neighbors already live in the area, and will have seen your “For Sale” sign if they were interested in your home. These mailers are used by agents to market their listing agent services.
Listing Agreements & Existing Listing Relationships
Have you ever read an actual Realtor listing agreement? If not, you’d no doubt be shocked to discover how one-sided they are. Specifically, if you sign this agreement, and all your listing agent ever does is come to your house, stick a sign out front, puts your home on the MLS, and never speaks to you again, you’ll still owe that 6% commission. So, even though the Realtor spent maybe an hour of time, and did nothing to actual sell your home, you will be paying him/her a tidy multi-thousand dollar sum. There are no exceptions: even if your mother decides to purchase the home from you, and you’ve signed the listing agreement, you’ll still be paying Realtor commissions.
Additionally, if you have signed a listing agreement, and you decide that you’d like to exit that relationship for whatever reason, be aware that you could potentially owe your listing agent thousands of dollars. Agents have been known to hold listings “hostage”, as no other agent can list your home on the MLS if you have a current active listing in the system. It is advisable to do the math, and if it’s cheaper to pay off the agent and list with a flat fee organization rather than pay a 6% commission, go ahead and pay the agent’s fee. Consider the money the cost of a hard-knock education in real estate.