7 Advantages of Working with Flat Fee Real Estate Brokers
If you’re selling your home, you should know that you’re in a competitive market. With nearly 5.5 million homes expected to be sold in the United States in 2020, you need all the help you can get.
How can working with a flat fee real estate agent improve on a commission-based model? Read on to learn the benefits of flat fee real estate brokers.
Flat Fee Real Estate Brokers
In the past real estate agents sold houses for a percentage of the selling price. Sellers would pay a commission of between 1 and 3 percent to the selling agent. There may also be a buyer agent’s commission to pay.
A flat fee real estate broker does not charge a percentage of the selling price. You pay a fixed fee to the broker and in return, you receive a set of services that includes a listing on an MLS.
A Multiple Listing Service is a database of homes that are available for sale. This gives visibility to agents and buyers of your home. It’s an effective way of marketing your home for a fraction of the conventional real estate agents commission-based fee.
1. Know Your Costs
A major advantage of using a flat fee real estate broker is the transparency of the costs. Moving house can be an expensive time. There are many unexpected costs and unknowns.
Unknown financial matters include the price that you will eventually sell your house for, legal and other professional fees, moving costs and the buying price of any house you move to. The uncertainty can be stressful.
It’s good to know that you can be very clear upfront about the real estate brokerage charges. At least that can be budgeted for and there are no unpleasant surprises.
2. Planning Ahead
When you are selling a house, you need to plan ahead. You may need some funds to cover expenses before you have released any capital from the sale of your property. No matter what you sell your house for, whether it is less or indeed more than you expected, the real estate fee is the same.
This means you can plan ahead to pay the fee. Knowing ahead of time means you can plan things like the budget for buying a house, any money you might need for other fees and improvements. It can make a difference to what you can eventually afford to spend on a house, on repairs or decoration of your new home.
3. Save More Money
Compare the cost of a flat rate realtor with a conventional real estate agent’s fee based on a percentage of the selling price. You’ll notice a significant price difference. The savings may be the difference between being able to afford a down payment on a house or failing to have enough money.
4. Sell for More
Once you agree on a percentage fee with a real estate agent you are committed to paying that percentage no matter what your house eventually sells for. This means that if your house sells for more than you expect you don’t get to keep all the extra money your buyer pays. The agent gets a percentage of the higher amount.
If you opt for a fixed fee and your house sells for more than you expect, you retain all the extra value achieved. This can happen if your house proves attractive to several buyers and they enter into a bidding war. The price can increase and achieve more than your asking price.
If this is the case you get to benefit from the gain and keep the extra amount. You don’t have to share any gain with the real estate broker. You only owe them the flat fee agreed when you engaged them.
5. Value for Money
You might think that because you are paying less for your home to be marketed you will get inferior service. This is not necessarily so. Even though it is a flat fee, your real estate broker can deliver a wide range of services comparable to a conventional percentage-based real estate agent.
Real estate brokers can include listing your property on a multiple listing service, taking professional standard photographs, and advising on marketing. After you find a buyer they can also help you with closing the sale including helping you negotiate the best price for you. Just check what’s included in the package of services in your fixed price fee.
6. Speed is of the Essence
When you are selling a house, speed is often important. It’s no good for you to have a house on the market for a long period of time. You need to find serious buyers quickly and get to completion as soon as possible.
A fixed fee broker gets paid on closing the sale. They have to be efficient to make this business model work for them so they have every incentive to achieve your objectives as soon as possible.
You can set the pace and control what price you wish to sell at. They have no interest in hanging out for longer in the hope of achieving a higher sale price and increasing their percentage-based fee. You are in control and if speed is important to you, you can move quickly.
If you are an experienced house seller you may feel able to handle much of the selling process yourself. If you are new to house selling you may not feel comfortable with handling some of these tasks. A flat fee service can allow you to opt-in or out of various services.
Take your own photographs if you feel able. Conduct your own open house events if you wish. You can reduce your flat fee if you go for fewer services or pay a little more and have a fuller service.
Value and Choice
Selling a house can be stressful so it’s good to know that one aspect of it can be designed around your needs. Greater value, more flexibility, and the ability to plan ahead make flat fee real estate brokers a service worth considering.
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