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Wayne Newcomb's Blog

By Wayne Newcomb | Agent in Albany, NY
  • Why Use a Discount Broker?

    Posted Under: Home Selling in Albany  |  February 14, 2011 8:45 AM  |  316 views  |  No comments
    Is the old adage "you get what you pay for" true when it pertains to listing your home with a real estate broker?  Before I give you my thoughts on the subject, I must disclose that I work for a discount broker and always have.  Now that disclosure has been made, let me tell you in my subjective voice why you "should" use a discount broker. 

    When an agent obtains a listing, whether he works for a conventional or discount broker, that listing gets put in the MLS and is sent to every website of every broker in the MLS.  If a potential buyer goes to the conventional broker's website, he'll see the discount broker's listing and vice versa.  The broker then decides how it will be marketed.  Today, nearly 90% of all searches for homes occur on the internet.  So that becomes the obvious place to target the market.  In our company's case, even though we charge thousands of dollars less in commission, our internet marketing stands up to if not surpasses most of the conventional brokers we compete against.  It's easy to check it out, just pick out one of our listings and pick out one from a conventional broker and compare.

    So if the marketing is similar and all the listings are on all the realtor websites, what else is there you might ask.  Sub-agency, that's what.  Conventional realtors might charge let's say 6% and give away 2.5% to a subagent (the selling broker).  We, on the other hand, might charge you 4.5% and still give away 2.5%.  But what we can do that they can't is raise the sub-agency without charging you as much commission as they do.  For instance charging the seller 5% and giving away 3% to the sub-agent.  Under that contract we still save the seller 1% and we give the selling broker 1/2% more.  On a typical $200,000 the seller saves $2,000 and the selling broker makes $1,000 more by selling our listing.

    As far as being at a disadvantage by hiring a discount broker, let me just reference myself for a second.  I have finished in the top 7 in resales over the last 7 years in my entire board which has produced some 4-5,000 realtors over that time.  Most of them have worked for conventional commission brokers.  Also my company has beaten the average of the MLS listed brokers 5 out of the last 6 years running for sale to list price % and we have also more than held up our end in turnaround time.  If there is an advantage to charging more in today's market I just can't see it.  Spoken, I guess, from a person who is proud to work for a discount broker.  Oh, and by the way, the brokerage is owned by my father and his wife.  How's that for disclosure?

    You may reach Wayne Newcomb, Jr. at Yankee Realty (518) 452-3450 or (518) 371-5055.  Website:  http://www.yankeerealtyinc.com
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