Choose your listing agent. See Listing With An Agent for more information on how to choose an agent, what agreements you'll fill out with them and what services you can expect from real estate agents. For more information on my services, see My Listing Services.
Listing Agent Services
A Listing is when you create a written agreement with a real estate agent to represent you in the sale of your home. The Listing Agent then has the task of marketing your home, putting it on the MLS, being your advisor and advocate, negotiating on your behalf, completing Purchase & Sale contracts with you and walking the sales transaction through to closing. In exchange for their services, you agree in a Listing Agreement to pay the Listing Agent a specific commission if they bring you an offer from a "ready, willing and able" buyer. Commissions are paid at closing from the proceeds of the sale.A very powerful tool that is available to real estate agents is the Multiple Listing Service (MLS). It is essentially an online database of thousands of properties for sale all across the country. Agents working with buyers scan it daily for new listings that meet the needs of their clients. When your Listing Agent lists your home on the MLS they essentially multiply your sales force. Now you don't just have your Listing Agent working to get your home sold, you have hundreds of agents in the area doing it. If one of those agents represents the buyer in purchasing your home your Listing Agent will generally split their commission with the buyer's agent.
A Listing Agreement is a contract between the seller, their Listing Agent/Broker and the Multiple Listing Service (MLS). The Listing Agreement states all pertinent information about the property, including price it will be listed at, any personal property included with the sale, any real property not included with the sale, any special showing arrangements (i.e. hours), amount you agree to pay in commission, duration of Listing contract, permission for your agent to put your home on the MLS and internet, etc.
- Since most homes are sold through agents, most agents representing buyers look on the MLS for homes. They don't seek alternative methods like newspapers - which is the primary avenue that FSBOs have to market their properties.
- Another reason that buyer's agents just look for homes on the MLS is that homes listed on the MLS have an agreed-upon commission stated up front. In other words, the buyer's real estate agent knows they will get paid for their efforts. Bringing a buyer to a property listed in the Seattle Times is risky for an agent because there is no contract binding the seller to pay them a commission. They could be working for nothing...not very motivating for most people!
- Yet another reason that buyer's agents don't bring clients to FSBO properties is that the homes listed on the MLS have a lockbox (a box that contains the house key that agents can access) while FSBO properties do not. It is much easier for an agent to view homes with their clients if they can just get in with their own key. Making appointments with owners who will have to be there to let them in is a hassle. You'll miss out on potential buyers because their agents will just skip your home.
- Being a buyer's agent on a FSBO property always ends up being more work for the buyer's agent as well. Not only are they educating their own client, many times they end up educating the seller on contracts and the escrow process. And they have to handle every detail from both sides - not just for their own clients. They suddenly doubled their work for the same commission.
An alternative that alleviates some of the above issues is using flat fee listing services. This is where you pay approximately $500 - $1,000 to rent a lockbox and have your property listed on the MLS. With this option, you would still agree to pay the buyer's agent commission - typically 3%. This allows your home to be marketed in the MLS. However, issues still exist with this option as well.
- Some buyer's agents have a very poor image of flat listing fee services and will not take their buyers to those listings, so you will still be missing out on some of your market. These agents think they will still end up doing twice as much work. And agents may think that if the seller is so cheap that they aren't willing to pay for a regular listing then they will be difficult to negotiate with and a hard person to work with.
- Unless you thoroughly understand all the contracts and escrow process, you can really make drastic mistakes that could cost you lots of money or a sale since there is no one advising you on what to agree to and what to negotiate on the purchase and sale agreement. Beyond signing the wrong thing, even saying the wrong thing in front of the buyer's agent could end up being a liability. It's a risky position to be in.
- Unless you hire an agent or an appraiser to give you an estimation of your home's value, you could price your house too high or too low. That can be a lot more devastating than you think. I've seen it time and again where a seller lists with a flat fee service, their home doesn't sell because they don't have the marketing or pricing experience, they end up listing with an agent eventually anyway and then (since the house has now been listed twice and sat for a length of time) prospective buyers assume the seller is desperate and they offer a low price. Listing information stays on the MLS for two years - even after the house has sold, cancelled or expired. All agents will see the history of your home and your attempts to sell it.
- You have no one negotiating for you or looking out for your best interests. The buyer has a professional in the field of real estate and negotiating and you are on your own.
Commissions may seem like a lot, but you are paying for the education and experience of a professional. If you pay a lawyer $200 an hour to prepare a form for you, you may think that seems like a lot just to fill out a piece of paper. However, that lawyer has had years of education and experience that tells him the advantages and disadvantages of filling it out in a particular way. He knows exactly what to do, say and write that is in your best interest with the law in mind. I don't know about you, but I'd rather pay the lawyer than personally read thousands of pages of law books to learn what they know and still risk making errors. In recent years, the process of selling a home has become much more complicated. With an agent representing the Buyer in a purchase transaction, they have the upper hand. Have someone on your side too - there are rarely any buyers without agents on their side.
Invest in a professional and the whole experience can be easy, stress-free, exciting and net you more money than you could get if you attempted to do it yourself.
For more information on the services I provide when I list your home, see My Listing Services.
So, you're thinking of selling your home? Determining its value is one of the early steps in the selling process. And it is VERY important to get right. There is a narrow margin between getting the most for your property without asking too much and getting what's appropriate for your property without asking too little. Agents assist sellers in determining where to price their home with a Comparative Market Analysis (CMA)
A CMA is an estimate of market value performed by a real estate agent based on similar homes' sale prices. Other factors such as how long it took similar homes to sell, originally-listed-price to actual-sale-price ratios, condition and asking price history will all be taken into consideration when preparing a CMA and determining an asking price for your home. A good agent will spend several hours working on your CMA. If you are interested in obtaining a free CMA I would be happy to provide you one.