agent gave me the est. seller sheet. she will make 8k and me the seller will make 2500 of the sale of my house...does not make any sense to sale?

Asked by Baltimore Seller, Baltimore, MD Mon Apr 5, 2010

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9
Don Tepper, Agent, Burke, VA
Mon Apr 5, 2010
As Jeanne says, you're comparing apples and oranges.

The agent is being compensated for the work and expenses involved in selling your home. You're receiving money based on the spread between what you owe on the home and what someone else is willing to pay. If you'd bought the home 20 years earlier, the agent would still earn the same amount of money, but you'd be receiving a lot more. There's no expected relationship or linkage between the expenses involved in selling a home and the equity in the home.

As far as whether it makes sense to sell--that's for you to decide. Essentially, you'll be breaking even. If you really have to sell, then it makes sense to sell. If you don't have to sell, it may make sense not to sell.

And remember: real estate commissions are negotiable. Discuss your agent's commission with her. It'll especially help if you're planning on buying another place, and could use your agent both to sell your current home and to represent you in buying a new one. In that case, you have a much better chance of negotiating a reduced commission on the sale.

Hope that helps.
2 votes
Jeanne Feeni…, Agent, Basking Ridge, NJ
Mon Apr 5, 2010
Whether it "makes sense" to sell is a decision only you can make. You are comparing apples and oranges - your agent will earn her commission by helping you achieve your goal of selling, it is not a contest on who makes more from the sale. It may be a dead heat, when you factor in net earnings after her broker takes his cut and she factors in her own expenses.

Imagine the question from a seller who owes nothing on the home, is selling for $900,000 and the agent is netting her cut of a 2.5% or 3.0% commission, you see. The agent's commission is her pay for the work she does. Your profit on the home is a entirely different calculation.

And as a prior poster pointed out, if you make a penny in this market, consider yourself among the lucky ones.

If you decide to sell, good luck. Price it right and get a move on!

Best,
Jeanne Feenick
Unwavering Commitment to Service
Web Reference:  http://www.feenick.com
2 votes
Jeanne Feeni…, Agent, Basking Ridge, NJ
Mon Apr 5, 2010
Mack, love the Buffett quote. To Baltimore Seller- you will pay, so make sure you get the value you have been promised and deserve in return.

Love that quote!

Best,
Jeanne Feenick
Unwavering Commitment to Service
Web Reference:  http://www.feenick.com
1 vote
Mack McCoy, Agent, Seattle, WA
Mon Apr 5, 2010
The other agent will likely make $8K, too, and they won't be working on your side.

As the crew says below, whether it makes sense to sell depends on your personal situation, not on the price of real estate commissions.

When it comes to hiring a real estate agent - or anybody - remember the sage words of Warren Buffett: Price is what you pay, Value is what you get. Make sure that your agent is providing value, should you decide to sell.
1 vote
Jessica Hood…, Agent, Gambrills, MD
Mon Apr 5, 2010
What the agent earns is going to be based on the sale price of your home. It is possible he/she could be making more money that you are depending on your mortgage balance. If the total commission listed is $8,000 keep in mind that this is generally split between the selling agent and the buyer's agent so your agent may only be making $4,000. If you choose to sell your home without professional representation you will not have this expense, but you will also be responsible for finding and negotiating with your buyer as well as coordinating all closing activities with a title company, lender and various inspectors. A good real estate agent is well worth the commission paid.
1 vote
Keith Sorem, Agent, Glendale, CA
Mon Apr 5, 2010
Sellers sell to accomplish something more important. Why are you moving? Is it worth it?
IOW, do you have any reasonable alternatives to selling? Can you keep it as a rental? What if the actual sales price is less?

Options:
1. If you are not satisfied with your net, you could try to negotiate a lower commission rate.
2. Most Realtors have a point at which they will turn down a listing, most also need to be able to explain to a seller why they are worth the fee they charge.
3. The real key here is this: The actual selling price for your home, when it sells
The link below says that home values are dropping 1.8% over the last 12 months. I'd be curious what your Realtor would tell you about comps for your price range.
4. Also, depending upon the comparable sales, your property condition, and other market variables, the actual sale price could be more or less. The sale price is based on what other homes are available for a buyer to purchase at the time your home is on the market. That means that the estimate is based on what is going on at one point in time. Once your home hits the market, if there are more homes selling in your price point, you could either gain or lose, solely based on other homes competing for a limited pool of buyers.

You should know that the Treasury Dept. has completed its expenditure of stimulus funds buying mortgage-backed securities March 31st, so most lenders anticipate a half point increase in interest rates, which in effect will decrease home values. Talk with your Realtor about the details.

Lastly, a good Realtor will help you get every dime out of your property, suggestions on what you can do to improve features that buyers like and will pay. Comparing Realtors' suggestions can give you are really good idea if your Realtor knows marketing.

Good luck!
0 votes
Dp2, , Virginia
Mon Apr 5, 2010
How many properties like yours has she sold within the past 90 days? How long did it take her to sell them?

Perhaps, it might help you to view this from another perspective--especially if you have to sell right now. Which is better for your bottom line: 1) listing with an agent who charges more and sells the property sooner (eg within 1-2 months), or 2) listing with an agent who charges less and takes more time (eg 6 months) to sell the property for less?

Of course, there are other ways re-structure your deal to make your numbers pop more (ie to yield you a larger profit), but--as always--those other ways come with different trade-offs.

Please feel free to contact me for more details.
0 votes
Peter Boscas, Agent, Columbia, MD
Mon Apr 5, 2010
Keep in mind the estimated seller sheet is only an estimate. You may find yourself in a situation where you aren't making any money at all, if the sales price is less than what is estimated by your current agent.
You should be basing your decision whether to sell or not on other factors. Why are you looking to sell in the first place? Do you have a new job or are you leaving the state?
Web Reference:  http://peterboscas.com
0 votes
Scott Godzyk, Agent, Manchester, NH
Mon Apr 5, 2010
Well it depends if you HAVE to sell. If so then yes. Without knowing the sales price or any of your motivation to sell or not to sell it is hard to give an opinion. Commissions are negitiable and you can negotiate before signing a listing and some sellers try and do it again when we submit an offer to them. It doesnt seem there is a lot of room or profit to work with over what you owe for teh house, so if you need to sell, it is definately worth it.
Web Reference:  http://www.ScottSellsNH.com
0 votes
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