Is it a good idea to hire a Realtor to sell my home for a 3.5% commission?

Question

I live in Southern California and I'm planning to put my house for sale soon. I saw this add in front of a house that's for sale in my neighborhood.

HOME SELLERS

Don't pay 6% - 5% - 4% commission to sell your home.

At ----------------Realty we offer Full Service including MLS listing for 3.5%.

I know this realtor has sold several homes in my area. Is this really a good deal or are there hidden charges?

Answer 1

Normally commissions are split between the buyer’s and seller’s agents. The usual split is 50/50. If this discount real estate agent accepts 3.5% then that means that the buyer’s agent will get 1.75% or half of the commission. Most agents I know will not show a house that offers less than 2.5% and in this market you want every person you can to see your home. If he wants to take 1% and offers 2.5% to the buyer’s agent it might work. Remember, you get what you pay for and most REALTORS® work very hard for their commissions and they are worth every penny.

Answer 2

I agree it is a bit of a scam but it is still worth the investment because the realtors are truly the "gate keepers" of the market and a large segment of buyers are fearful and ignorant. That 3% is essentially a fee to get house on market. Sure you can get it on MLS and probably can market it far better than any realtor, but most buyers work with a realtor because it is free for them and do you really think a realtor representing buyers is going to be honest about a house that circumvents their profession? NO!!! They will not mention house and even if buyers force issue they will try to sway them away form it. Realtors do not like people who go outside their private club and especially if they know they will be working the entire deal for only 3% instead of the 5% they normally get if they are sole realtor. Realtors are like lawyers. Most are incompetent and almost all are solely driven by their own greed and laziness. IF you choose to sell it yourself you will essentially end up with same profit at end of day (or even less) unless you choose to do a contract/rent to buy which would be something outside realtors club and they dont want to touch (because no money for them).

Answer 3

If you live in Southern California (so do I) I would suggest not signing a contract by "any" realtor for any longer than 3months, look this has become a quick changing market- do not sign a long term contract with any realtor, unless they are going to advertise your place in the times and pay for "staging" your house. I sold 3 of my personal homes in the last 30days in an area that has slowed, I signed up with a realtor that was willing to pay for a "staging company" and also advertise for the total time I had it listed with her. You see in life you don't get what you deserve, you get what you 'NEGOTIATE".. Winners negotiate better than loosers. Price at the end of the day means nothing, ROI means everything. Selling a home in November 2006 is completely different than selling your home in nov. 2005, so be strong!!!..beware the Lazy realtor, I cannot stand the ones that tell me they sold 10million in the past few years.. Look the last few years were not today, what have you sold in the last 30days is what matters.

Answer 4

Hi Thomas,

I'm in Southern California and I am a broker. I offer 3% as one of my options to list a property. Just know that the listing agent is going to keep a certain percentage and offer the rest for the buyer's agent.

I'm in Orange, San Diego and Riverside County. If you can hold off on selling your house for 3-5 years, I suggest you do so (I bet you never heard a real estate professional tell you that before!). If you need to sell, make sure you're not tied into a long contract. Contact me and I will work something out with you and go over all your options. It's my company so I can be flexible in determining your needs and resolving them.

I also am fluent in all aspects of real estate, from negotiating short sales to managing property. There's nothing that I can't do.

Regards

Answer 5

As a buyer's agent, I love it when I see listings like this. I know my buyer is gonna get a steal.

First of all, the listing agent is offering a reduced "cooperative commission", so most other buyers are not going to see the house. Secondly, the listing agent is taking a pay cut himself, so he just wants it sold fast and will be good at "getting the seller to sign".

List it and have your agent give me a call. I always have buyers needing a great deal!

Answer 6

Most Realtors and Real Estate Licensees are some of the hardest working folks I know. They are there to protect the interests of their clients and most do so wonderfully well. In the case you sell your home without one, then you stand the risk of accepting the fate many other inexperienced sellers accept: lawsuits.

If you are diligent about the dentist and doctors who attend to your health needs, then it is only logical to seek out someone more experienced and is professionally trained to handle one of the largest investments most people make. In the final analysis, it could end up saving you money.

Answer 7

I would normally tell you that you get what you pay for. If you hire a discount Realtor you get a discount attention but if you know the guy has sold a few houses in your area why not. I would ask the Realtor what all of the fees are but if is seem OK go for it.

Answer 8

It might be that they are going to represent the buyer and seller, in which case they only charge each of you about half of the usual commission.

You get what you pay for, if I was selling my house, I would use the best person I could afford, that way I will get top dollar for my house.

Answer 9

well it doesn't hurt to ask. Ask them for a full breakdown of their charges and what it will cost you overall. Get it in writing and then if you go with them they can't back out.

I have sold my home myslef. Its pretty easy to do as long as you have a good lawyer to do the paperwork for you. So I saved a bunch of money on fees. But what is a pain is showing folks around, getting it advertised etc etc . If you get the right people there then you will sell it . Getting them there is the hard part.

Answer 10

Real estate sales people won't show your home if you don't pay them. In a down market one time I paid a $1,000 bonus for the selling broker, and it worked. Worth it.