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Markat, Real Estate Pro in Atlanta, GA

Do agents shy away from FMLS listing by non traditional brokers or FSBO?

Asked by Markat, Atlanta, GA Wed Jun 27, 2007

Market is slower in Atlanta. I have my home on FMLS through a non-traditional source. I am acting as my own agent. I sold real estate in another city and did not want to get "back" in the business here. A Real Estate Company lists your house on FMLS for $500. I hear agents do not like the fact that this type of real estate "sales" is cutting into their business, even though they are protected.

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As a Real Estate Professional, I work with all sellers. When contacting a non MLS FSBO customer, I always offer tips and advise on how to enhance their experience . Its a tough market and we work together. I would not shy away from a FSBO if it suits my clients criteria. Real Estate professionals do have a means to "protect" themselves.
5 votes Thank Flag Link Thu Jul 5, 2007
Markat
Your profile says that you are a real estate pro, yet your post sounds as though you are a home seller. Which is correct?

You did ask a very good question which deserves an honest answer. Real estate agents are paid when an escrow closes. No closed escrow, no income.

Generally speaking a discount broker, MLS-only, are not as well-trained, organized, and helpful. Most agents that represent the buyer in a purchase wind up doing BOTH sides of the transaction. Agents are not paid until the broker authorizes the check to be released. In our office ALL paperwork must be completed correctly. The legal liability is simply too great. So that means that if a buyer's agent actually has to perform BOTH selling and buying sides, they expose themself to a much higher degree of liability (not to mention work...time).

Because we are commissioned based, time is money. Active, professional agents enjoy working with one another because both agents work TOGETHER to get the escrow closed. Two motivated, trained, professional agents, can spend less time and effort closing the sale, so they have more time to work with more clients.

So, it's simple. All things being equal, agents will show homes, however if an agent is known to have "problems", that listin probably will not be shown as much. Also, since time is money, the truth is that, again, all things being equal, higher commissioned listings will get more traffiic...which is the idea, right? If there is a lot of inventory, you've got 50 homes to show, how do you select? If you were the Realtor, and I was the buyer, what would YOU do?

Good luck!
3 votes Thank Flag Link Wed Jun 27, 2007
Keith Sorem, Real Estate Pro in Glendale, CA
MVP'08
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I would never list with a discount broker. Yes...a friend of mine did and agents dod ged her house and it expired....she then went into foreclosure and lost it! Pay the fee of a good reputable agentthey all know each other and they show each others listings based on 'who' they are....outsiders or discount brokers will never do well in well populated areas.
3 votes Thank Flag Link Wed Jun 27, 2007
If a property is a slam dunk match for my buyer, I will take my buyer to see it regardless of the commsision, difficulty of the agent, FSBO status, difficulty in showing, or any other circumstance that might make the property challenging or unappealing to me personally or professionally.

When the property is a near potential match, and so are 25 others, your property might get left out of the mix. As a buyers agent, I first sort to all potential matches, then prioritize based on best matches. Aftter I have all of the best matches covered, I review the remaining that might be considered. WIthin that group, I still prioritize based on buyer preferences first. Ultimately, I have a remaining group of properties that may or may not get shown. Therein, those properties which are easiest to show, pay a fair commsison, and are not challenging to see or work with rise to the top of this group. I don't really care who lists it, but when I know I am going to be dealing with a FSBO, I know that will be a harder transaction that with a Realtor in most all cases. Even when Realtors represent themselves, emotions get in the way of business. The liklihood of emotional problems creeping into the negotiatiions, plus the additional liability makes the transaction undersireable. If your property is a great property for my buyer, I will do this for them. I don't consider your property via FMLS any different than any other FSBO. When working for my buyer under an exclusive agency agreement, I will seek out every FSBO property for them, also.

If you have a house that is priced much under market, in great condiditon, shows great, and has buyer demanded amentities, you will showings.

It's not about the fact you are cutting into my business, a FSBO transaction represents greater difficulty and greater liability. It's the same as a lawyer representing a client against a pro se. Even if I gain great strides for my buyer client, I become concerned about the fact you are unrepresented. There are horror stories of FSBOs claiming equal knowledge and equal ground with licensees until they find out they made poor decisions and are unhappy with the contracts they negotiated for themselves, and then reposition themselves as the disadvantaged.

It's not about you cutting into biz, it's about liability and difficulty. Some FSBOs are less emotional and more knowledgeable than others. And,yes, I have had my share of a few difficult encounters with licensees. I still prefer to negotiate for my client and have the other side have knowedeable and competent representation.
2 votes Thank Flag Link Sun Aug 26, 2007
Deborah Madey, Real Estate Pro in Red Bank, NJ
MVP'08
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The 80/20 will always come into play here. I personally am benifiting from discount brokers, this is not the market to place a sign in the yard/ listing and hope they will come. People are always looking for a bargain but if you had a $300,000 medical or legal issue would you seek discount representation or the best money could buy.
Your home is probably the largest invesment we have but we cut corners and blame the market for the results. The main reason they don't get shown is the pricing is influenced more by the homeowners emmotional appraisal than the Realtor. I list a home I put up $2000 with no guarantee of return, you can bet I will price the property correctly to get the best price in the shortest ammount of time and win the referral. What incentive has the discount broker got, they already have your money if it does not sell so what?
Web Reference: http://www.teamrenton.com
2 votes Thank Flag Link Sun Aug 26, 2007
I agree that agents will show any home that fits a clients needs but I must say I have heard agents avoid some of these listings because they end up dealing directly with the owner and may leave themselves open to liabilities as they are essentially handling both sides of the transaction.
2 votes Thank Flag Link Tue Jul 17, 2007
I am always amused by the agents who claim they show all homes regardless of who is selling it, under the guise of ethics
Unless I am mistaken, your role as a real estate professional is to represent your clients (buyers or sellers) to the best of your abililty. The level of compensation offered should not by the paramount consideration. When I worked with buyers I was ALWAYS selective about which homes I showed my clients. I would seperate unrepresented home sellers and those represented by full and discount agencies and agents of disrepute.
The possibility of a closing commission with those mentioned above could never compensate for the likelihood of anguish to my buyers that unrepresented or poorly represented homes attract.
My answer was to supply them with the listing information and let them know that if they have any interest in that house they should contact the FSBO or agent directly.
To this day I have never lost a client/customer, or found anyone who felt I did not have thier best interests on my mind.
All agents need to remember that profitable real estate is achieved through volume and no one commission, large or small is worth selling your professionalism for. Keep your clients best interests at the top of your list and you will never go wrong.
2 votes Thank Flag Link Thu Jun 28, 2007
Your question is from a "real estate pro?"

The market in Atlanta is slower than last year but still much more bustling than other areas. There is no reason your home should not be sold if priced right and marketed correctly.

Discount brokers on their own account offer nothing outside of MLS access. Since most buyers use agent, the agent is helping them select the BEST homes. If Atlanta is a slow market (I disagree, but I do agree it is a buyer's market, not slow) then there are many homes to choose from.

As in the other answers, which one do you think prospective buyers or their agents will pick,

Home A listed by a Full Time Agent with lots of photos, good description, and easily accessible

or the typical discount listing of

Home B: No or few photos, badly taken. Poorly written script. Features not highlighted or "checked off" correctly (won't pop up on MLS search) poor directions and poor availability (call owner) and a perceived notion that you're dealing with a cheap person who thinks they can do it all. Finally, the other notion that the agent is going to have to do twice the work.

It has nothing to do with cutting into my sales, it has to do with cutting into my time and dealing with difficult owners.

I will say this. Discounters are great for our business. The allow the good agents to really stand out in terms of statistics and failed listings (sounds like yours) will be now well schooled in what a true Realtor can do.

Finally, if you have the know how to market the property and do all the necessary steps and make it as easy as possible on the buyer's agent, I think you'll do just fine.

All that being said, you're not a good Realtor if you prevent a buyer from seeing a particular home.
Web Reference: http://www.jrjarvis.com
2 votes Thank Flag Link Thu Jun 28, 2007
Joshua Jarvis, Real Estate Pro in Duluth, GA
MVP'08
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I believe Keith has a good concept of what it takes to get a transaction completed with a "discount" broker.
However, that being said, ultimately as a buyer what type of agent do you want to have servicing you? One who will pay attention to what goes into their own pocketbook at the end of the transaction or one who pays attention to your wants and needs as the priority?
That being said, if the market in Atlanta is slow(and do not believe the hype of the media, good homes, priced right still sell!) then why would you want to market your house through a non-traditional broker? Your house deserves a full service broker that will be able to give you maximum exposure and generate traffic. An experienced agent will also be able to guide you through this market. This is not the first time this type of market has existed. Just some food for thought.
So while Keith is correct that in a non-traditional transaction, the buyer's agent ends up doing the majority of work for both sides, your wants and needs for your new home to fit your lifestyle should always be first and foremost to any monentary gain by the agent. Best of luck to you!
Web Reference: http://SeanHayes.cbp1.com
2 votes Thank Flag Link Wed Jun 27, 2007
There is nothing I can say that will top what Deborah and Paul said, I agree with them completely, and with many of the other responses either in full or in part.

For my own part, I show whatever the buyer wants to see. I have only had 2 buyer clients, as I said buyer agency has only started here recently, and one was a condo. There were about 20 for sale in the complex and I showed the 5 most appropriate and they bought one. So I didn't even get to the FSBOs in that complex. My biggest "problem" with FSBOs or discount MLS sellers is the homeowner is always there and has always always ALWAYS hovered over us and for the most part talked waaaaaay too much, throwing off my schedule and usually shooting themselves in the foot by revealing too much that didn't need to be disclosed. I actually had one seller tell my customer/buyer that he was in over his head and HAD to get out!
1 vote Thank Flag Link Sun Aug 26, 2007
Agents may say they dont show homes that are not listed w/a traditional type company but the bottom line is if they have a buyer and that house fits the buyers needs they are going to show it an perhaps sell it because they want to earn a commission.
1 vote Thank Flag Link Tue Jul 10, 2007
Agents need to keep in mind that refusing to show a particular listing to a client ,who has requested to see it, because it is listed with a particular broker, is not only unethical, it is also a violation of federal anti-trust laws.
1 vote Thank Flag Link Tue Jul 3, 2007
I will show my buyer clients any listing they want to see, regardless of the commission or who the broker happens to be. My obligation is to my clients first and foremost, and if they want to see it I show it. To do otherwise is unethical, in my humble opinion
1 vote Thank Flag Link Wed Jun 27, 2007
I have handled more than a handful of disclosed dual agency transactions (I handled paper work for both the seller and buyer. ) There was virtually no additional work involved due to handling both sides, In several instances the transaction was very smooth. So, like Ruth, I don't see that additional transaction work is that onerous for me if I sell a listing represented by a MLS entry only broker.

I do acknowledge that showing may or may not be more difficult. It is a minor pain in the neck to have to go the seller to "secure my brokerage fee" before even showing the property. Yet, for a unique property, I have often found it worthwhile to jump through the obstacles and hoops.

I have stated in previous posts that in a buyers market, with 50 to 100 to 200 homes that match the buyers parameters, I'm looking for ways to narrow the field. I would not personally boycott an MLS only entry; After reading the posts below, I wouldn't recommend it as a strategy to a seller, either.
0 votes Thank Flag Link Sun Aug 26, 2007
Jim Walker, Real Estate Pro in Carmichael, CA
MVP'08
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JR: I agree. That is the main drawback.
Ruth
0 votes Thank Flag Link Sun Aug 26, 2007
Ruthless, Other/Just Looking in 60558
MVP'08
I want to scream!!! I delayed responding before because of the length of time it would take me to compose my response. I'm going to condense it to a few short items.

1) Read: http://www.nytimes.com/2007/06/08/business/08home.html?ex=11…

2) Exactly what additional work is the Buyer's Agent doing on behalf of the seller or the flat rate agency? Telling the seller, "You need to do this." or "You didn't initial all of the pages of the contract."?

3) Have any of you done a transaction with a flat rate service?

4) If agents keep thinking that the only reason a consumer uses a flat rate service is to save money, then being out of touch with how to service your clients will hurt you in the end.

5) Read: http://www.buysiderealty.com/news/news.asp?article_id=28
Here are some quotes from it:

"[The business creators of BuySide Realty] had a disappointing experience in the office of a Los Angeles real estate agent when they went west to look for a vacation home...Why should we do his work and then pay him a commission?'"

"[Consumer] what spurred her was irritation with an agent...she didn't mind going without an agent who might pick up on water damage, cracks or other details that escaped her notice. "I was going to bring in a good home inspector before buying anyway, so I felt protected"

"the surprise [of the business model] has been the appeal to move-up buyers..."we were projecting our upper end to be in the high $300,000s, but it's into the $500,000s." Buyers have used BuySide all the way into the $1.6 million area, they say, a level where the need to save isn't as urgent...theorizes that's because the move-up buyer knows the ropes."

Food for thought...think about it so you can afford to buy food.

A fed up buyer and seller that knows the value of an exceptional agent but also knows the lack there of.
Ruth
Web Reference: http://www.oak-park-il.com
0 votes Thank Flag Link Sun Aug 26, 2007
Ruthless, Other/Just Looking in 60558
MVP'08
Lots of response on this one. I’m not in agreement with some of your answers. I do feel that there are agents out there that will not show homes that are not listing with an actual agent. They see it as a big headache. I am not one of them. If there is a house on the market that is for sale and it fits what my clients are looking for then ok. I feel if I can find my client the home of their dreams then they will tell 10 people about me and I will get more business down the road.

Also keep in mind in a down market (I’m in one in Corona, Cal) you need to put your home on every internet based marketing site as you can. Go to http://www.vflyer.com. Get yourself a free account and you can make nice looking flyers to print out and they will also put your home on about 8 different internet sites. Also you will get an html code that you can use on http://www.craigslist.org. CL has done wonders for me in my market. How are the open houses in your area? Open houses are also a good way to get buyers. I did one over the weekend and had 10 people come in who found my listing on Craigslist.

Well good luck and happy selling.
Web Reference: http://www.4saletours.com
0 votes Thank Flag Link Tue Jul 17, 2007
I will show everything my client wants to see but I WILL pre-call FSBOs to make sure they are willing to pay a commission. I'm not in the charity business (sometimes it seems that way). I use the leverage I have ahead of time to get a one time showing agreement from a FSBO.

Most buyers are so into doing their own 'internet shopping' that they will come to you many times with a property you would rather toss in the trash but you do what you have to do- protect yourself, inform the client.
0 votes Thank Flag Link Tue Jul 10, 2007
As a firm that sells many homes as Trustees, we do some via FMLS/MLS and some via FSBO. Unfortunately we do have many brokers say they will not even show discount broker's listings since they end up doing more work for the same commission (they claim).

Luckily the Atlanta Market is vibrant and the creative agents are plentiful enough that this isn't across the board. It is unethical IMO to not show a listing based on what the OTHER agent is getting paid, but such is life!
Web Reference: http://retrustee.com
0 votes Thank Flag Link Mon Jul 9, 2007
I show my clients all properties in their price range but not every agent will for the reasons outlined by Sean and Keith. Half the time a company that will list your home for $500 isn't going to do anything else for the seller... which includes reviewing offers, writing counters and following up with all the details of the sale. As a former agent you may be the exception to the rule but most sellers who choose this type of discount company are really expecting the buyer's agent to handle both sides of the transaction at a huge discounted fee. Therefore if an agent has a choice of 15 homes to show a buyer that are listed by a professional full time agent who will handle their end of the transaction... and there are 4 listings which are similar to the 15 homes listed by a traditional agent... which ones do you think will be shown first. If you were still active you would do the same thing.
My suggestion is that you put somewhere on the listing that you are a licensed former full time agent and will handle all the aspects of the transaction and I would up the buyer agent commission a bit.. you will still be ahead on net dollars to you and might generate more activity. I would also send a flyer to all agents about the house and stress the larger commission and your ability to handle the transaction.
0 votes Thank Flag Link Wed Jun 27, 2007
Kaye Thomas, Real Estate Pro in 90266
MVP'08
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