When I went to their website last night to make sure the link was valid, the NEW flash presentation said something about listing for free but I couldn't find the details when I entered the NEW site. I guess he wants you to call or email.
St. Charles and 847 is a long way from Oak Park. So after I fired my full service agents/agency, it was a difficult choice to return to the excellent customer service but not the best marketing, or to try Prello and unknown to me. I chose Prello because they had excellent marketing and I believed my target market was city dwellers moving to the suburbs. I called a bunch of their listings to interview them for feedback on Prello. I swear one of them was you, ICG.
Not really, he was a builder not a rehabber. He said he broke up with his agent girlfriend because she was upset that he wouldn't pay her 2.5% to list his properties. Why should he? He's got an entire marketing staff, he's offering an above average co-broke and it only costs him $299 to be in the MLS.
I was surprised that EVERYONE I spoke to listed with a flat rate broker was doing so because they were INTELLIGENT and disgruntled with their previous full service Realtor - NOT to save money!!!
Agents, it's time to wake up to the fact that not all FSBOs are BOZOS.
Oh, back to Prello. Their marketing is great but their customer service and support really is LIMITED service. I would NEVER advise someone who wasn't extremely experienced to use them. To other agents outside Illinois, here in IL almost all real estate transactions involve an attorney. Anything that I lack knowledge-wise or am not getting from my flat rate Broker or would normally get from a full service Realtor, I get from my excellent attorney (Terry Faloon in La Grange) that I have used for years.
P.S. If Prello reads this, they should consider merging with Friendly Realty.
Lunch is always popular, although it means that many of us will wait to come visit you 'till around 11:00 or later, to take advantage of "free food" (we are such food whores, aren't we?... it's like we've never been fed!?). As ruthless mentioned, if you can get a flat-fee $49 MLS listing, it sounds as though it'd be well worthwhile!
I very much appreciate your comments. You have brought up several valid points to consider. I totally understand that most FSBO sellers have little to no idea what it takes to move a property in any but the very best of markets. I think one of the points that many have brought up though is the issue of getting top dollar, or leaving money on the table. Unlike most buyers, this is not my motivation. I really could care less about getting the best offer. Remember, by negotiating a short sale from the lenders, I am creating a huge amount of equity. There are alot of "so called" short sale experts that think that knocking a few thousand off qualifies as a short sale-but We consistently manage to discount notes 30-50%. This creates so much equity, that I can afford to let properties go at below market prices and still make a good profit. We are not greedy, and we are not looking to make the home runs. One of the reasons why we think our properties are great for realtors (or anybody) to consider, is that by not being greedy, we pass on the equity to the end buyers. We think that this added incentive in this market is something that not many sellers can offer. We want our properties to benefit the buyer as much as the seller.
It doesn't have to be lavish unless you're selling a multi million dollar property... Several trays of deli sandwiches and beverages will do the trick. Just make sure the food is GOOD and that it will bring brokers back to your future open houses.
Consider doing this 2-3 times during a 2-3 week period to make sure you get the most traffic. I always recall missing open houses because I was out of the office or the open was not well communicated to the entire office.
Make sure the word gets out to as many brokers as possible... A single fax to each office WILL NOT do the trick if the floor time sales person, receptionist, or office manager simply tosses the fax in the trash.
I'm in Chicagoland. I'm as knowledgeable about my market and the real estate industry as most Realtors. What concerns me is that you NEVER comment about being in the MLS? If you want to attract buyer's agents, you need to be on their Broker's Open listing through the MLS. The Broker's Open doesn't show up in ChicagoTribune.com or Realtor.com but it goes exclusively to the agents. I had 42 agents show up when I announced it via a $49 non-exclusive listing through Gino Barrto at Friendly Realty in St. Charles. There is a check mark for offering food and you get more agents that way. In the MLS you also have an "Agent Remarks" section where you would put something to the affect of "Seller is an experienced real estate investor offering below market value properties and higher commissions."
I have a two part response to your post. Answering your original post, and commenting about the pros/cons of exclusive seller representation, particularly your comment to Eric.
First....attracting buyer agents to your property at a Broker Open House. Buyer agents never quite know what they are getting themselves into w/ a FSBO, flat fee listing, etc. Buyer agents are interested in serving the needs of their buyer. If those needs are easily met with an abundance of property offerings through traditional Realtors, your property may not receive the same attention. You have two messages to get across to buyers agents. First, you must face the same competition as any seller represented by a full service Realtor. Depending upon the volume of lisitngs in your market, that may be easy, or not...
If there is a surplus inventory, you need to tell the buyer agents why this property is better than the competition.
Your second obstacle is to overcome any apprehensions that buyer agents may naturally have w/ FSBO or flat fee listings. If your property is a perfect match, a buyer agent will simply bite the bullet and contact any seller. Some sellers who chose the FSBO or flat fee route are not well educated in the marektplace. The most challenging ones to deal w/ are those that think they have a handle on the market, but do not. Some FSBO or flat fee sellers are 'anti-Realtor". You need to communicate to the buyer agents that you are realistic, knowledgeable, and want them to come w/ their buyers.
Contact local Broker offices and advise of your scheduled Broker Open. On your flier, communicate the above points. If your property is highly unique, then having a special event at a special time may work. If the property is not highly unique, hold the broker open during the time when such is typically done in your area.
Comment about exclusive representation: By not hiring a seller representative, you forfeit the mareketing that this seller rep would do for you. This reduces the pool of potential buyers for your property. Any time you reduce the pool of potential buyers, you won't know, even upon accepting a contract, if another buyer might have produced a stronger contract. I do understand that you believe if you produce your own buyer through your networks, you feel that the amount owed to the seller agent is an unneccesary expense. That extra expense, however, might be the driving force that would allow a higher contract price from that contact you produced. Buyer interest is what drives a price for a seller. Buyers determine value in their mind, in large part, by considering other buyer interest. For example, a buyer from your network comes forth. If they perceive no other interest, they are comfortable negotiating downward. If they perceive a lot of other interest, it validates value in their mind. Buyers often ask, "How long has this been on the market? Any offers?" Long market time and no offers to buyers means offer less $$. Even if you produce your own buyer, it doesn't mean that the efforts of a seller agent did not contribute to the outcome.
In addition to marketing, a seller agent offers constant feedback and advice that will help you better position your property. I am very confident in my knowledge of my local market, but still depend upon the constant feedback of all the agents, buyer comments, website traffic montioring,etc.
Bottom Line: I do fully respect your right to make the decision that is right for you. I also wanted to share with you why I beieve in the value of seller representation.
In lieu of an exclusive listing agreement, your best bet for attracting Realtors is to pay a flat fee to be on the MLS. You can then use that listing, and other related available marketing (see link...shameless plug) to attract them to your brokers' open. Then, you have the best of both worlds - the continuous marketing of the MLS, but no commitment to anyone. As for the flat fee, you can save much more than that, in return, by reducing the co-op commission to 3.5 and even 3%, instead of 4. It'll still be higher than most everyone else's and, therefore, a prime attraction.
As for the open house, itself, they're more likely to come during standard Tuesday lunch than an evening wine & cheese affair.
I hope this helps.
Free lunches aside, brokers have little to no incentive to bring clients to your 4% property when there are higher commissions to be had, let alone hundreds of comparable properties on the legitimate market. Another factor that FSBO sellers frequently overlook... Many brokers simply do not trust FSBO sellers with their clients. You might be a perfectly rational, professional individual working to sell your own property. But in the broker's eyes and in the broker's experience... Most FSBO sellers are total whack jobs who are more interested in floating their crazy rationalle as to why they think a client is going to pay $30K more than the property is worth. Don't blame the brokers for this viewpoint. Many FSBO sellers are certifiably crazy.
BOTTOM LINE: Brokers have the clients. You don't. This is not a market where you pretend that you know more than the people who's livelihoods depend on selling properties like yours.
Just a heads up, you say that you actively market your own properties.
Do you plan to have the Realtors that bring a buyer do both sides of the transaction? (represent seller (you) and buyer? Curious as to who would be representing your interests?
Also, I assume that your plan is to max your profit in this transaction? Whether you sell on your own our through a limited or MLS only broker, you know that your odds of selling are different, right?
NAR data shows consistently that sellers that sell on their own net less (like 16%)
My own data shows that MLS only or Limited service consistently has a lower Sales price to list price ratio and much longer days on market. Do you know of any statistical data to support your plan?
I believe in free enterprise. Are you prepared to leave money on the table?
Mass email a digital flyer of your property to broker offices in the area with your broker's open date
Since you will be handling your end of the transaction, for the sake of exposure only, put your listing on the MLS through flat fee listing service -- highlight broker's open date on the MLS
Hold a general open house advertised on Craigslist and the paper. Put plenty of signage near property and make sure to highlight in ads and on signs: "BUYER AGENTS WELCOME!"
Even agents have a hard time getting other agents to their agent open houses in my market. Food is a must but it is really the network of the agent (among other agents) that will generate traffic to an agent open. Itâ€™s one of those intangibles that experienced agents bring to the table. One of our agents has good success by hosting agent and public opens at the same time during the afternoon/evening. They are mostly attended by the agents he knows and works with in the market and usually at least a few buyers.
For not much more than you are offering to compensate a buyerâ€™s agent you can get representation and marketing too. For example we have long term relationships with investors that provide that we identify property for the investor, help with information and trends for the remodel based on the market and comps, and we start marketing the property right away. Of course every market is different.
Most FSBO sellers feel they are smarter, yes, but end up selling their home for less then using a good realtor. There are so many bad agents out there is terrible, yes, I agree. That is why you need to find an agent that is working and busy in this market.
As for the Brokers Open... Good luck.
Thanks for your update and comments. If you were in my market, I would definitely come to your Broker Open, I don't have any buyers for you in Chicago, but I am a bit curious about your properties. Do you have any info on your properties that you can email to me? Again, this is really just about my curiouslity.....I don't work in Chicago, nor do I have any referral buyers to send your way. Simply curious.
Good luck to you
Definitely a lunch from a "name brand" restaurant or specialty sandwich shop. I would also suggest printing flyers and dropping them off (or hiring a student to do this) to as many offices within at least a five mile radius telling of the great property, great food and great commission you are offering.
You can google local area brokerages and come in distributing a flyer where you put it in large lettering: PAYING FULL 4% COMMISSIONS and the date of your open house. Offer a ruffle or a prize or refreshments...
I doubt that agents will be overly excited about this though - it's hard to guarrantee their work being paid by the seller (present company excluded) without any type of agreement, and no one wants to chase the seller over the commissions - we'd rather help our clients buy or sell instead.
Just being honest with you.
You can also blog about the house, UTube etc. but the exposure on all real estate websites (which is very expensive and we pay for, as realtors), the MLS info available to thousands of agents in your area - are well worth the commissions paid.
Think of the time you'll be wasting doing this...while you could have been making money in your chosen profession...And the main point - FSBO always sells for less money than with a pro realtor.
Best of luck,
Beachfront Realty, Inc.
CDPE - Certified Distressed Property Expert
Lastly, the link in your profile should lead to a viable website:) (.net, not .com).
Good agents don't even care about open listings with the supply were it is we have plenty of properties to sell even for a steak sandwich. Thats why most FSBOS become clients it just a matter of time until you realize how important good agents are.
2625 W. Peterson Chicago, IL 60659
Phone (847) 329-9660
Fax (773) 769-0240
Your idea of holding a broker open is excellent.
Since your property is not offered in your local MLS media, a broker open would be a way to intoduce your property to active agents in the area.
Some MLS's will sell email addresses of their members.
If you are in an area to purchase the member list, send Broker open announcements to the member agents.
Best of luck
I would hire an agent and pay him/her 4.5% - let the agent split the commission with a buyer's agent 3/1.5.
This will save you alot of headache. You seem to want to work hard, not smart. The fact that you are a lawyer and can defend yourself in court does not mean that you would not still hire a lawyer.
It's probably not very wise to ignore the traffic that agents will bring in if the property were on the MLS. I started out in this business as an investor and people teach you to be cheap and avoid agents by all means, because they will "eat up" your profit. Bad advice.
I guess the big investors like Trump and Robert Kiyosaki don't use agents. You really want to work smart and not hard.