Ask a Realtor: Am I paying my Realtor too much?
On real estate
Dear Joan: I am stunned at how much local real estate agents make on transactions in our area. I should have become an agent and joined in the financial bonanza available to be reaped in. I am getting ready to sell my property and move out of the area and I am working on how I can avoid those exorbitant fees. I could sell it myself, but I would have to deal with the public, or I could use a discount company that puts it in the MLS, but I would still have to show it myself. Or maybe I could just sell it to one of the companies, like Zillow, that are buying homes directly. I guess I could also try to talk a local agent into a much lower fee, but that would be hard for me. Looking for suggestions, if you would be willing to give me any, since you are a Realtor!
Dear Confused: I would be happy to help you figure out how you can put more money in your pocket when you sell. First of all, you need a knowledgeable Realtor with great negotiation skills. You have made it plain that you do not qualify for that position. If you were selling by yourself, you might lose buyers with your lack of knowledge of the business and you certainly could lose tens of thousands of dollars on negotiating your sales price and any possible settlement on the Inspection Objection that the buyer would present.
Also, in today’s market, any buyer with any net worth is going to use a professional to show them houses. If you are not in the MLS they will probably miss you, and if they do show your house, you will be negotiating against a professional. You are correct in saying that if you use a company that just charges a fee to put your property in the MLS, you are still doing all the For Sale By Owner jobs, with no expertise or assistance. As far as selling to an iBuyer company, which can be found as a division of most real estate companies now, they probably would not accept your property nor would you want to suffer the loss on your net profit if they did. Most of the iBuyer programs are designed for the low end of the market, under $300,000, and usually end up costing the Seller 13% to 15%, according to the industry analysts.
Lastly, about talking your real estate agent down on their commission, I would like to give you a few facts to consider. Almost always the real estate agent is giving their company a split out of their commission. They are paying for marketing, and if they offer you the size and expertise of a team, they have many more expenses. They take photos, spend weekends doing open houses and all with no guarantee of ever being paid back. They use every bit of their knowledge and skills to get you the most money possible. Therefore, I believe you actually will net more money, to put in your pocket, by using a skilled professional at a reasonable commission rate, than trying to sell on your own with no commission. If you are making more money, I would say, no, you are not paying them too much to get there.
Joan Harned is an owner and broker for Keller Williams Mountain Properties and heads up Team Black Bear, her own real estate team. Harned has been selling real estate in Eagle County for 27 years. Contact Harned with your real estate questions at email@example.com, 970-337-7777 orhttp://www.skiandteehomes.com.
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