Home Selling in Austin>Question Details

Raj Shah, Home Owner in Austin, TX

How to sell house with flat fee for listing and flat fee for buyer agent?

Asked by Raj Shah, Austin, TX Sun May 12, 2013

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16
Laura Rosales’ answer
Hi Raj,
This is a good question but to answer it fully, I would be interested to know the entire scenario and what your overall goal is? Compensation is a negotiable item and you should sit down with a REALTOR and discuss what you would like to Net out of your property and the best way to meet your goal. Listing agreements outline the commission structure for listing agents, buyers agent and sub agent. You can do a flat fee but this is rarely done. If you would like to discuss this question or any other with me, feel free to give me a call or email message. I specialize in listing properties in the Austin Area.
Best Regards, Laura Rosales-REALTOR
512-771-5334
0 votes Thank Flag Link Wed Jun 19, 2013
If you're selling a lot or a house that is not what most would consider prime real estate, it makes sense. There are trade-offs. Agents here have gone over that. In a particularly strong market, the traffic is so high agents can be selective. I know of agents in Denver that are so busy taking care of clients in the immediate area, they send buyers with eyes on nearby cities to other agents.

Best regards,
Suz
0 votes Thank Flag Link Wed Jun 19, 2013
While this might seem like a good idea in some ways, it probably works best if your property is super low priced, like a lot, and you want to offer more than the prevailing commission.

If you are think that you want to offer less than most agents expect, than you may be doing yourself more harm than good. You can be driving away potential buyers.

Want to make agents SWARM to bring their buyers to your home. OFFER A BONUS.....not a discount. Think about it just based on the responses you have seen here.

There are agents that will show your home even with ZERO commission, but buyers are savvy too. I showed one a house like this the other day and the buyer started picking the house apart like there was no tomorrow. Shocked me. I just showed it to him as a courtesy while we were looking at other homes. I would have referred him to the listing agent if he had wanted to make an offer on it, and then what position does that put you in as a seller?
0 votes Thank Flag Link Mon May 13, 2013
Bruce Lynn, Real Estate Pro in Coppell, TX
MVP'08
Contact
Raj, Call me and let me know what you are looking to do and I will see if I can help. I'm sure you have seen many many answers already so I won't rehash.

Joe Jarusinsky, Realtor/Master Instructor, Keller Williams Realty, Austin's #1 Real Estate Company, Ranked #1 by Buyers and Sellers (JD Power & Assoc. 2012) Call 512-261-4415
0 votes Thank Flag Link Sun May 12, 2013
Hi Raj, All aspects of the sale are negotiable so it is best to discuss your overall goal with the agent you select or are working with. When a Realtor lists your home the total commission rate you are paying is set in the agreement. It outlines the overall % or fee and then the selling agent pays out a portion to the buyers agent. Example: 6% total from seller = 3% to listing agent and 3% to buyers agent. When your listing agent enters this information into the MLS system, a field is filled in showing how much the buyers agent will receive. Most of the time it is 3% to the buyers agent and it is VERY rare that a flat fee is entered. There are ways to negotiate and still allow for the buyers agent to receive the 3%. Realtors work off of commission and MOST of the time would not ever choose not to show a home based off of the commission they receive but - this could be the case if you are not offering much to the buyers agent. Sometimes the buyers agent has negotiated something with the buyer that a flat fee could effect. This is where you can sit down with your listing agent and work out numbers that meet your overall goal. I hope this is helpful. If I can answer any other questions feel free to contact me.
Best Regards, Laura Rosales-Austin Realtor
0 votes Thank Flag Link Sun May 12, 2013
Remember everything is negotiable. Seller pays all commissions, usually, and you will probably have more success implementing this with your listing agent; it may be a shock to a buyers agent, but I well repressed should work out fine. You could work this out as a function of a Variable Rate commission. Charlotte Brigham, Broker, MBA. Turnquist Partners Realtors
0 votes Thank Flag Link Sun May 12, 2013
You don't have to pay commissions, Raj, you just can't expect that real estate agents will be eager to show your property.

People tend to have a picture of real estate agents, but really, we are a diverse group. For every deal-centric analytic number-cruncher, there's a former teacher or health care worker with a buyer.

The one difference is that the more touchy-feelie type of agent is likely to show a low-commission property to their client in the name of Customer Service, and the deal-centric agent with a Roladex large enough to require its own Dropbox account may decide that it's not worth their time to tickle the database over your discounted commission.

There are other permutations, of course. But as a practical matter, if the buyer's agent isn't going to get the commission from you, they're quite possibly going to get it from the buyer, which is going to be reflected in the offering price.

All the best,
0 votes Thank Flag Link Sun May 12, 2013
It is very disappointing to see buyers agents think of themselves first before putting their clients interest before theirs. I have had an agent tell me that the fee being offered was to little when she found out her client was interested on the property. The property commission was what it was which it was less then usual and this buyers agent preferred not to earn that commission and told her buyer that she couldn't work with them because "it was a conflict of interest" yeah the conflict of interst was for her because she was not earning enough. What kind of agent is that? A greedy one in my eyes. Agents like that give us agents, which we are many a bad name. Realtors code of ethics is our clients best interest comes first not ours. Yes Realtors do work hard for a commission but unfortunately if there is a perfect home for your client and it just happen to have a low paying commission for some agent not to show that listing is just wrong.
0 votes Thank Flag Link Sun May 12, 2013
Hi Raj,

Depending on your exact bottom line requirements, you may want to try and sell your home for sale by owner. Having said that, I have noticed For sale by owners selling for less than other homes with maximum exposure.

If you would like to see my different listing programs, feel free to visit my website or contact me anytime.

Steve Nusinow
(512)922-7588
0 votes Thank Flag Link Sun May 12, 2013
Here's another fun answer.

If I can't build and retain value in my own product (me) when im selling me... how could I build and retain value in your product?

Discount realtors are in discount "zone"!
"Stack em deep, sell em cheap!"
0 votes Thank Flag Link Sun May 12, 2013
On the other hand, a flat fee of about $3,000 per $100,000 sales price might actually work!
0 votes Thank Flag Link Sun May 12, 2013
Raj,,

Flat fees are not often agreed upon especially on the buyer's agent side. I just sold a house where the buyer's agent was offered 2.5% (most of the time it is 3%) and unfortunately there were agents who told me they would not show the house because of that. Your listing agent can agree on a fee with you, but has no control over a buyer's agent decision to show your house or not. You should be more concerned with getting an experienced, knowledgeable agent who truly has your interest at heart and will sell your house under the best possible terms. Things happen sometimes during the selling process and a good agent will know how to solve problems. My fee is negotiable, so give me a call and let's see if we can agree on a mutually acceptable fee.

Vivianne Dordea, Realtor SRS, GRI
Sierra Homes Realty
512-970-8814
0 votes Thank Flag Link Sun May 12, 2013
Its easy! You simply sell for much less.
Hard fact stats prove year after year, sellers taking this and other cheap selling techniques, will end up selling for 5-15% less than they would with a premium marketing plan and salesperson handling the sale.

12% is average loss for FSBO (for sale by owner). That's what you're doing here.

See, when you reach a smaller pool of buyers, you surface less offers. When you reach a larger pool of buyers and you hit them with a marketing strategy that is designed to get you a higher sales price, you not only surface more buyers, but you create a higher price war between them all.

High-quality buyers are the high price payers. Reach them, trigger their purchasing emotions, and drive a higher sales price every time.

Thinking that you are saving 3-6% on listing fees by hiring a flat fee agent is a myth and will cost you much more. Thats not a guess, that's a national statistic.

Major companies (that sell everything you use everyday) spend a lot of money on quality marketing plans and execution. That's not because they love throwing money in the trash, its because anything-less IS!

The good news about the process you are about to hndertake is that you'll never see it coming because you only sell that home once! Your lost dollars are hidden in the idea that your largest investment and most expensive product purchase of your life doesnt deserve a solid marketing and sales plan/execution.

I have proven this myself, over and over. I can share those stories with you if you like to inquire with me.
Web Reference: http://shawnmon.com
0 votes Thank Flag Link Sun May 12, 2013
Raj,
Flat fees are something that can be agreed to. I disagree that, as some implied, an agent would do "less to their best" or would deliver "less than expected" service. I doubt any agent can truely say they have "never" agreed to and accepted a discounted commission/fee. We do have to mke sound business decissions as to what makes sense. I'd be happy to meet with you and discuss all options.
Bill
0 votes Thank Flag Link Sun May 12, 2013
You won't have a problem finding a flat fee listing agent but my guess is finding a flat fee buyer agent will greatly depend on the amount of "flat fee" you're offering on the buy side. Less than 1.75% will likely get you few, if any, showings from buyer agents.
0 votes Thank Flag Link Sun May 12, 2013
I suppose you can find a "discounter" that will do that for you. Just remember you get what you pay for. Just saving some small amount on comission is not necessarily a good option. Will someone who is accepting less, really represent your best interests and attempt to get what your home is really worth on the market, or will he/she just put it out there and hope?


Ron Cullinan
Avalar Austin
GRI, CRS, ABR, CLHMS, e-Pro
512-799-3239
austin_realtor@earthlink.net
http://www.austinonlinehomes.com
0 votes Thank Flag Link Sun May 12, 2013
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