Burlington, VT (PRWEB) January 06, 2012
New technologies and real estate resources have made it easier than ever for real estate buyers and sellers to connect directly without the assistance of an agent. Some of these game-changing developments make it possible for the average homeowner to perform services which were once only attained by contracting a real estate agent, who would then collect a customary six-percent commission of the home’s selling price. Robert Foley, a former real estate lawyer and the current owner of Flat Fee Real Estate in Burlington, Vermont helps explain the growing list of alternatives to the traditional six percent commission model and provides tips for a successful sale for both first-time and experienced sellers.
1. Know your marketing options
Most sellers assume that they need to hire a realtor in order to gain access to the area’s Multiple Listing Service (MLS). Thanks to the internet, homeowners have the ability to list in the MLS system without hiring a full-service agent. Depending on the area and MLS, the companies that offer this typically charge between $300 and $500.
In addition to access to the MLS, sellers can utilize free services such as Craigslist to help market their property without the use of a full-service agent.
2. Determine if you need professional guidance
Based on knowledge and experience, some sellers are able to sell their home without the guidance of a real estate professional. First-time sellers and those who do not have a firm grasp on the market or process of selling will likely benefit from professional guidance. For those who have sold a property before, understand the market, understand the process and have the time, hiring an agent may not be beneficial.
3. Explore market alternatives and insist upon competitive rates
For sellers who choose to hire a real estate professional, it is important to investigate what market alternatives exist in their area for services. While professionals in some markets continue to charge the same rate (typically a six-percent commission), most markets have competitive alternatives, such as firms that charge a flat fee regardless of the price of the home. These flat fee realtors are growing in popularity and often offer the same services as more traditional professionals.
Even if a homeowner resides in a market where all professionals claim to charge the same six percent commission rate, homeowners can still try to negotiate. Real estate professionals know that consumers have many choices when marketing and selling their home and therefore have become more willing to negotiate.
4. Be realistic and don’t let professionals “buy your listing”
Every homeowner wants to sell his or her home for as much money as possible. Knowing this, real estate agents will often tell homeowners that their property is worth more than it actually is, with the hopes that the seller will choose them over another agent that provides a more realistic house value. This practice is commonly known as “buying a listing.” Agents who utilize this practice first secure the listing, and then after the property has been listed at the overpriced amount, the agent will suggest a price reduction to something more realistic.
To avoid this coercion, sellers should first try to determine a realistic value of their property. There are many online tools to help with this, and the best method is to look at the recent sales (within the past six months) within their neighborhood.
5. Try to remove emotion from the process
Selling a home is naturally an emotional experience given the many memories tied to a home. Because of the emotional attachment, decisions made regarding the sale of the home can oftentimes be less than rational. Although it is difficult, sellers need to do their best to look at the sale of their home objectively. It is common for sellers to overlook or downplay the home’s shortcomings, while placing too much value on the home’s features. By looking at the home through the eyes of the prospective buyer, sellers will make more rational decisions throughout the process.
6. Don’t go overboard with staging your home
It is important that the home is staged so that it shows well, but oftentimes there is a tendency on the part of seller to go overboard in creating a “natural setting.” Most buyers are not impressed with techniques like lighting scented candles or playing music, and these effects can sometimes even turn them off to the home.
7. Don’t get offended by offers that seem low
Due to the emotional attachment to a home, many sellers get offended when a buyer makes what is perceived as an insulting offer. It is important to keep in mind that selling a home is a business transaction and the buyer is trying to get the best value for his or her money. Sellers should try to appreciate that the buyer is also trying to protect their financial interests and not overpay relative to the market.
8. Don’t be afraid to make the commissions part of the transaction
Rarely a buyer will make a full-price offer on a home. Typically, they will offer anywhere from 5-15 percent below the asking price. Sellers should understand that the realtors’ commissions can become negotiated as part of the transaction, with the exception of cases where a buyer makes a full price non-contingent cash offer.
For instance, consider that a home is listed for $275,000. The buyer makes an offer of $265,000, and the seller is not willing to sell unless he or she receives a net a profit of $270,000. Thus, the parties are $5,000 apart.
If the sale does not materialize, the agents make nothing. The seller should tell their agent that in order to make the deal work, the seller's agent and buyer's agent should each reduce their commission by $2,500 (for a total of $5,000). In this case everybody wins because the seller receives the amount desired, the buyer pays an acceptable amount and the agents make something rather than nothing.
9. Understand the purpose of a home inspection
Most contracts between buyers and sellers are contingent upon the buyer having the property inspected and being satisfied with the inspection results. If the buyer is not satisfied with the results of the inspection, they can terminate the contract.
Despite what many buyers believe and despite with many real estate agents advise their clients, sellers are not required to remedy every issue raised during a home inspection and in fact, it is not fair to ask a seller to remedy each issue raised. Homeowners are not selling brand new homes, and the price reflects the natural wear and tear on the home. The seller should be willing to fix code violations and immediate safety threats.
10. Don’t look back!
Sellers will sometimes reflect on the sale at the closing and think that they could have received more money if they had waited for another buyer. Once the closing is concluded, the seller should take their check and not look back. Life is too short for regrets!
About Flat Fee Real Estate
Flat Fee Real Estate is a full service, independently owned real estate brokerage firm located in Burlington, Vermont that provides real estate services throughout the state. With the simple mission to save Vermont’s real estate buyers and sellers money, Flat Fee uses expert knowledge to provide all of the services that traditional real estate firms do, but for a lower commission. Differing from the conventional 6% commission model, Flat Fee saves clients money by charging a flat fee of $3,500 or 2% of the sales price, whichever is less. Flat Fee also provides additional services such as the ability for sellers to list in the Multiple Listing Service (MLS) without a full service agent. For more information please visit http://www.flatfeevt.com.