Home Selling in Morgan Hill>Question Details

wary seller, Home Seller in Morgan Hill, CA

Is there a limit to the amount of brokerage fees for manufactured homes?

Asked by wary seller, Morgan Hill, CA Thu Sep 13, 2012

1st time seller would like to know why there is a difference between selling a home or a manufactured home, 1st time sell thinks 10% is to high, what is the average rate on brokerage fees ?

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The Medford Team’s answer
The traditional commission rate for selling a regular home (single family detached home, townhouse or condo) is 6%. The rate for mobile homes (manufactured homes) in a mobile home park is 10%.

There are a number of reasons for this:

1. It actually takes a lot more work to sell a mobile/manufactured home than it does to sell other types of properties. The pool of buyers is much smaller, lending requirements are more stringent – the are many reasons, but the end result is the same – whereas a normal property might sell in a month, a manufactured home can take 10 times longer.

2. The selling prices are substantially lower than normal homes resulting in very small commissions AND they are more work … therefore, agents want a higher percentage commission. Even at 10%, many of the commissions are almost negligible.

3. The pool of realtors willing to sell mobile homes is much smaller than the general market – most Realtors have no idea how to actually market a mobile home/manufactured home. Therefore, you are dealing with a very small group of truly qualified agents.
2 votes Thank Flag Link Fri Sep 14, 2012
Hello Wary,
Commissions are always negotiable. The reason mobile homes tend to be at higher percentages is because they take more time and work than a regular home, and they are priced lower. Where in Morgan Hill is your mobile? Some of the parks in town are more desireable and consequently sell faster than the other parks. In the better parks, we can be more flexible with fee's since they are easier to work with, and the homes tend to be priced higher.
Call me if you want, I'd be happy to discuss your situation and see if we can find an agreeable solution.
BTW- I live and have my office in Morgan Hill, so I'm very familiar with the area.
408 782 9933 x201
1 vote Thank Flag Link Fri Sep 14, 2012
Wary Seller,

All commission are negotiable. There are some ranges depending on the type of property being sold.

This is due to the time and return on that time.

Land and Mobile Homes will have a higher Commission than a single family home or condo. That can be around 10%

You can ask the Broker(s) you are interviewing to show you what is listed on the MLS as the offered commission to the Buyer Broker and then double that. Then you will have the average rate for your area, and price point.

I hope this helps you.

Have an amazing day!
Web Reference: http://www.terrivellios.com
1 vote Thank Flag Link Fri Sep 14, 2012
It has been my experience that 10% is the norm commission for a mobile home in a rented space. Your listing agent should be splitting that equally with the agent who brings you a buyer. How the commission will be split is reflected on the listing agreement you sign.
1 vote Thank Flag Link Fri Sep 14, 2012
Hello Wary Seller in Morgan Hill CA,
Let us make a real distinction first. I am NOT talking about a mobile home located on a rented lot. I AM speaking only of 'Fee Simple' owned real estate.
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Let me first make a comparison related to the financing part of this industry. Time and time and time again if find lenders will not grant loans to qualified buyers if the purchase amount is below $100,000. (Yes, I am aware their advertising says differently, reality is the currency I work with) The reason being, the processing of the application and associated expenses consume all the profit and more. In essence, there's no money to be made by the bank. They won't even take the application, or in a recent case, create so many delays that BOTH parties backed out of the agreement.
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In many cases. a bank will grant a low cap loan for a citizen referred by a real estate professional with whom they have a long standing relationship. This is a 'favor' that must be called in.
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Using the same logic, at some price point it becomes not profitable for a real estate professional to accept a property to sell based on the prevailing practices. A $30,000, full service listing can leave the real estate professional $1,200 in the hole if prevailing single family home prevailing practices are applied.
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As price points decease, the business model must change. There are many ways to create such a change. One is negotiating the compensation structure.
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A real estate professional may invest between 12 and 60 hours (added to direct costs) on a full service listing. Based on the percent of compensation you think is fair, what will the agent receive knowing they may only be entitled to 1.5 percent (in some cases 0.75%) of the LISTING SIDE compensation. (Agent compensation minus expenses divided by hours = income)
Did you do the math? Would you work for that? Approximately $450. A chuck of that has already been spent just talking to you. As you should be able to see, at this price point, prevailing practice simply does not work.
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For real estate professionals this is a business, not a hobby. You may come to realize yourself fortunate to find a gent willing to work in that price range.

Best of success in selling your home.
1 vote Thank Flag Link Fri Sep 14, 2012
At the going rates for Single Family Homes;
a Realtor would make about $500 commission on an average Mobile Home.
And that would include the extra work necessary becuase of the differences in Paperwork:
A Mobile home is considered a motor vehicle, not a piece of Real Estate.
Everything must be taken into consideration.
1 vote Thank Flag Link Fri Sep 14, 2012
If you're selling a mobile/manufactured home in a rent/least park/community it's not at all uncommon to pay a 10% commission or whatever you can negotiate with the seller. It's tantamount to selling any other chattel (personal property) i.e. auto, truck, RV, etc.

If, however, it's considered "real property" (connected to the land via foundation and engineered certification) then it usually falls under the auspices of "REAL PROPERTY" and sold accordingly.

Please refer to the following websites for additional information:

http://www.onthelevelcontractors.com
http://www.mh-processing.com
1 vote Thank Flag Link Thu Sep 13, 2012
Hello Seller,

Brokerage fees are negotiable. Going with the lowest fee is not always to your advantage. Make sure to discuss what your Realtor will do for the agreed upon fees.
Sincerely,
Staci Bell
Coldwell Banker Morgan Hill
1 vote Thank Flag Link Thu Sep 13, 2012
OK, I've read and concur with most of the answers below. I am also a Manufactured Home Installer/Contractor in Florida and workded there for over a year in the aftermath of Hurricane Charlie and his buddies visited Florida in '04 and for the most part agree with Annentte where Florida is concerned.

However, it's much different in California. As a licensed MH Dealer in California for the past 17 years I can personally attest to the fact that it is much easier to sell a MH than it is if lyou are a RE agent/broker whcih I also happen to be.

Should I choose to sell a MH in a MH lease/rent park/community all I need is a simple i page legal size CONTRACTURAL LISTING AGREEMENT, wihich consists of A 3 copy (white copy, Dealer Origanal, Yellow copy, Registered Owners copy, Pink copy, sales person & agent approval. and Registered/Legal Owners signiture copy.

Part I is the RIGHT TO LIST, SHOW AND SELL

PART 2 IN MANUFACTURED/MOBILEHOME DESCRIPTION, ADDRESS, REGISTRATION & TAX TYPE

PART 3: TERMS OF SALE

PART4: COMPENSATION FOR SERVICES

PART5: ADDITIONAL CONDIDTIONS AND AGREEMENTS.

This form takes less than 15 minutes to fill out

The only other form a MH Dealer/Agent needs is a:

HDC 480.1 REPORT OF SALE FOR A NEW MOBILE/MANFACTURED HOME or a
HCD 480.3 REPORT OF SALE FOR A USED MANUFACTURED HOME, MOBILEHOME, MULTI-UNIT MANUFACTURED HOUSING OR COMMERCIAL COACH.

This is a 1 page regualr 8.5x11 4 copy form. Copy 1 goes to the Department, 2 to the purchaser, 3, to the Tax Assessor and 4. stays in the MH DEALER BOOK.,

It's is simple as that. No pain no strain.

Now that stated if it's a RE agent/broker it's a whole new ballgame. Now you're looking at at the 10 part FORM MHPA (CALIFORNA ASSOCIATION OF REALTORS) MANFACTURED HOME PURCHASE AGREEMENT AND JOINT ESCROW INSTRUCTIONS

This is a very long drwan out and tedius process to say the least. This form can be used for both rent/lease park/communities but must be used on any/all real estate land/home transactions and is just the tip of the iceberg for the overall amount of time and effort that goes into a MH transaction.

I could go on and on but I think you get the idea. If you're going to sell a home in a rent/lease park/community go through a MH DEALER not a RE BROKER unless the broker also maintains a MH DEALERS LICENSE.

Most MH DEALERS wil charge a 10 sales commission or a $3000 minimum commission whichever is greater. It takes just as much tme and effort if not more to sell a $10,000 home as it does a $100,000 home.

However, having said that this is an old model and as others have stated now that RE Brokers have entered the arena they tend to carry with them their traditional 6% commission regardless of the sales price. That's why many RE agent/brokers prefer not to engage in MHs.

We've been a family owned and operated Manufactured Home Dealer, General and Manufactured Home Contractor/s, & Developer, Real Estate Broker with over 100 years of combined experience. We also provide engineering, architectural, landscape and interior design services. Should you have any other questions please feel free to contact us anytime 760 815-6977 or email me at onthelevel@cox.net.

Although we don't service the Morgan Hill area as a Trulia contributor we will be more than happy to answer any questions you have about Manufactured Housing, Real Estate or Construction. Or feel free to log onto any of our very user friendly websites for additional information.

http://www.tagrealestatesales.com
http://www.onthelevelcontractors.com
http://www.chadofalltrade.com
http://www.intimatelivinginteriors.com
http://www.sandiegorealestatetoday.com
0 votes Thank Flag Link Fri Sep 14, 2012
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