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 ERA Beach Ball Realty |
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Real Estate
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| April 2008 |
| Update by |
| Chris Reid |
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Learn How to Take Advantage of the Current Buyer's Market!
Prices are down!
Investors are taking advantage of these lower prices right now!
Why Don't You ! |
Selling in a soft market
The number of homes on the market has increased while the number of buyers has decreased. This makes selling your property in this soft market more difficult, yet some homes still sell. Why? The answer may be the home itself, but often it is the marketing efforts used to sell the home that makes the difference.
The first thing a prospective buyer sees is the exterior picture of the home. When the leading picture is of something other than the front exterior, most buyers assume there is something wrong with the house. A picture is worth a thousand words and will often dictate whether the written word is read. It's the first thing a buyer will see so don't leave a negative first impression. Pictures should make the buyer want to see the home in person.
- Clean and de-clutter your home before photographing.
- Eliminate photos of family and pets
- More is better - don't be stingy on the interior photos
- Include descriptive information on what sets this home apart for others in the neighborhood
- Include a virtual tour - it is the open house of today's market.
Producing agents don't have the time or inclination to look at every home in their market. With that in mind, agents are more likely to sell a house they have previewed so sellers need to attract agents. Here are some ways to get agents to look at your home:
- Make it easy for agents to show - we can't always give 24-hour notice. Most buyers do not make an offer on the home they initially called on. A qualified salesperson will try to show other homes in the area that meet the buyers needs.
- Offer the level of compensation the agent will receive affects how much your home is shown. Nobody wants to work for free. Since there are many properties on the market that can be shown, those with added compensation get shown more.
- Listen to your agent. Many buyers are immediately turned off by the smell of cigarette smoke and pets. With so many homes on the market, today's seller has to strive to make a good first impression. Remember: You never get a second chance to make a good first impression.
If you are not careful you can make an agent, with a buyer, NOT show your home? Here are the top ways to make sure an agent will pass by your house and show another instead:
- Having no lockbox on the property
- Restricted hours to show
- 24-hour notice
- By appointment only
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Discounting the commission or using discount brokers that require agents to negotiate to get paid for the work they do.
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Interest Rates
as of March 27, 2008:
30 yr. Conv: 5.85
15 yr. Conv: 5.34
1 yr. adj: 5.24 |
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Source: Realty Times |
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How Does a Real Estate Agent Get Paid?
 Don't be embarrassed if you don't know how real estate commissions work. I have had clients who didn't know, even though I had sold their home for them. Most people have misconceptions on how Realtors get paid and how much they actually make.
How Real Estate Commissions Work.
- All real estate agents must work for a licensed real estate broker.
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All real estate fees are paid to the brokerage - not the individual agent.
- Only a licensed real estate broker can pay a real estate commission.
- New agents can receive as little as 40% of the total commission received by the brokerage. Depending on the brokerage, fees may be deducted from that commission including advertising, office expenses, lock boxes, signs .
Listing Agents' Fees
Most brokerages utilize a listing agreement between a seller and agent that gives that agent's broker the right to exclusively market and sell the home. The agreement allows the brokerage to put the listing on the multi listing service (MLS) and in return to offer the cooperating broker a commission for bringing a buyer. The seller agrees to pay a commission to the listing broker who in turn will split this fee with the brokerage that brings a buyer. Generally this fee is a percentage of the sales price.
Cooperating Brokers
Just like life isn't fair, neither are commission splits. For example, a seller could sign a listing agreement for 7% that stipulates the listing broker will receive 4% and will co-broker 3% to the selling broker. It's not always a 50/50 split. Some brokerages will charge 7% and only offer the buyers agent 2%. In a buyer's market, sellers should insist on asking the broker to give a larger percentage to the buyer's broker.
Who Pays the Commission?
Typically, the seller pays the commission. It can be argued that the buyer always pays the commission because it's part of the sales price. The argument goes - if the seller did not sign with a brokerage the sales price might have been lowered. Given this logic, prices on for sale by owner homes would be lower. History shows this not to be true. People who market their homes without the benefit of a real estate brokerage rarely lower the price to compensate for the lack of realtor fees and often price their homes above the going rate as well. |
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Chris Reid, REALTORS
ERA Beach Ball Realty
Chris Direct (850) 485-3575
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ERA Beach Ball Realty
501 East Gregory Street
Pensacola Fl 32502
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Equal Housing Opportunity
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in the Emerald Coast for nearly five years. This market condition does not come along often.