Real Estate Marketing: Take Your Pick!

Minimal-Service, Low-Cost Brokers: Are They Right for You?

With more and more information becoming available on the internet, some homesellers are starting to think that they can do just as well with minimal-service, low-cost brokers as they can with full-service brokers.

The choices currently available to sellers are:

Full Service: Agents who provide a full range of marketing, negotiating, staging and other services to the sellers.

Discount: Agents who will work for less than 2% and may or may not provide full service. Typically these agents survive only where they can do a high volume of transactions. When the market cools, these agents typically go into hibernation.

Flat Fee: The One Fee Fits All plan. Services may vary, and you may still have to pay the fee even if the house doesn't sell.

Rebate: Get some money back from the sale price. Be sure to watch out for any restrictions on the rebate.

Pay as You Go: Pay the agents by the hour. Again, you may have to pay even if the house doesn't sell.

For Sale By Owner: Marketing can be a major issue, and this is not for the legally challenged or otherwise timid.

Matt Davis, a real estate attorney with the Seattle-based Demco Law Firm was recently interviewed by the Seattle Post-Intelligencer. Matt says that "Today the information is completely available on the Internet ... but the problem is that there are lots of pitfalls between signing the contract and getting into the house."

A real estate agent's primary service is knowing trends in the inventory, what houses are for sale and how much they are selling for, and understanding the pitfalls that lurk in the "fill in the blank" spots on the boilerplate contracts.

"They are drafting a $500,000 contract, so the question is, how much training do they have, individually and as a company, to make sure the contract is enforceable," said Davis.

Where agents are often invaluable, said Davis, is at the last minute.

"In order to close a deal, you need mortgage, title, escrow and the brokerage ... and even today, they don't always communicate well together," said Davis. "A lot of times, they will rely on the agents to be the hub for that because the agents tend to be more reliable and on the ball."

Davis calls real estate agents "the steward of the transaction" -- especially that one-in-10 deal that turns into a war zone.

Although some minimal-service brokerages do provide a full work-up of comparable sales in the area from their agent, no one will stop by the seller's house to tell them it was too cluttered with furniture to fetch a high price, or to point out other little details that inexplicably stick in a potential buyer's mind on that first, and often final, walk-through of the property.

And although the minimal-service agents may send them For Sale signs, no one will put together digital photos, artists' renderings or video commercials on the Internet to lure buyers.

Not receiving any of these "extras" from a minimal-service broker may mean receiving a lower price for your home as well as enduring a lot more headaches. Consider this: With a higher price obtained for the home, even after considering the larger commission paid for a higher level of service with a full-service broker, many homeowners will come out with the same or more net cash in their pocket, which is what's most important. And the time and frustration saved can be invaluable - it's hard to put a price tag on the benefits when the transaction starts to go south and the broker needs to step in to save the deal.

Consider personal safety as well when showing your home to strangers by yourself. Be sure to read this article for important updates on personal safety: Safety First! Don't Let Potential Buyers Into Your Home Without an Appointment!

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Linda Slocum
HoneyStartPacking.com
Santa Clarita Real Estate