Real Estate Brokers: why they are worth it is about how Real Estate Brokers are worth their weight in gold.
It’s also about some suggested rules to follow in order to help you obtain the best result in the least time for the best price, and to have your Real Estate Broker’s time best spent doing what she/he does best on your behalf.
This online post is written by an Architect, not a Real Estate Broker and voices the Architect’s opinions and no one else’s. Most Real Estate Brokers would likely never voice the statements the Architect makes in this article. Even though they are true.
Some people think that Real Estate Brokers make a lot of money off of every real estate transaction. The reality is that most brokers are lucky to earn around 1%+/- on each purchase or sale.
So where does the 6% (homes) and 10% (land) go?
Selling brokerage: half (3% for homes, 5% for land) NOT 6% or 10%. Because it is rare to have both sides.
Buying side brokerage: half (3% for homes, 5% for land) NOT 6% or 10%. Because it is rare to have both sides.
Then inside each brokerage (Buy or Sell): there is a split in which the main brokerage keeps about 40% to 30% of their side of the transaction, leaving only about 60% to 70% of the buy or sell side for the individual broker.
So, let’s look at a normal house sale or buy: 6% total, = 3% for the one side, then let’s say 65% of that = 0.0195 (1.9% for the actual broker managing your side of the deal. Then delete about 1% for the broker’s marketing/advertising costs = 0.9% left for your broker at the end of the deal.
Okay, so let’s say a transaction involved a $500,000 house.
x 3%= $15,000.
x 65%= $9,750
x about half for marketing = $4,875 your broker actually gets to keep as earned income.
Not exactly what you were thinking, is it?
Sounds like Real Estate Brokers are a pretty good deal for their buyers and sellers, aren’t they?
All that work making the deal happen for a minimal income.
So treat your Real Estate agent with courtesy and appreciation for all that they do. They earn it.
And please let them focus on Marketing your house & property, not running errands for you or doing maintenance chores that belong to you.
PRINT MEDIA IS ABOUT DEAD:
Demanding that your broker spend her/his minimal income on such things doesn’t really do you much good other than to make you feel good that you have insisted that your Broker squander their pre-income but accomplishes next to nothing. Better to let your Broker manage the marketing electronically, which is how 99% of all home/land searches are accomplished these days online.
YOUR BROKER ISN’T YOUR CONTRACTOR OR PROPERTY MANAGER:
They aren’t there to sweep your floors, repair your deferred maintenance items like a leaking roof or bugs eating your siding or scrub your toilets or repair your leaky pipes. It is your job to hire people to maintain your house and land. Let your Broker do their job MARKETING. You do your job maintaining your house and land and have them in top condition so that when they are inspected, there are few if any red warning flags (which buyers will use to demand that you lower your price). You hire contractors and landscapers, painters and other construction/maintenance professionals to keep it looking nice and working properly. This is not the job of your Real Estate Broker.
You dwell and maintain. Your Broker markets.
By allowing them to do just that, your buy or sell will happen faster and with better results.
COMPARATIVE MARKET ANALYSIS:
Your Broker works in the beginning to assess what the going price should be for your house or land, based on actual, real sales in similar communities as close as physically possible, with similar houses with similar features and size. Let your Broker do this without interference. Why: if you force him/her to make the price higher than the going rate, your house/land will sit there and not sell and not sell and not sell, until after months, you will blame the Broker (when you’re the one that made that happen) and allow them to reduce the price. Unfortunately, buyers will then smell blood in the water and anyone interested will demand much lower prices. Meaning: you will have shot yourself in the foot by demanding too high of a price in the beginning. Better to let your Broker do her/his analysis and set the price so that it will sell faster and in the end, probably for more, than if you require it be overpriced to begin with.
Conversely, if you’re buying and you demand that your agent make a lowball offer, you could very likely antagonize the sellers and they could either refuse to sell to you, or to raise the price instead of lower it. We’ve seen it happen, especially when you’re in a region filled with “triple A” personalities of well-to-do people “who really don’t have to sell.” They don’t take kindly to wiseacres that think they are going to scam them. They’ll just take the property off the market for a year and then sell it later and not to you. So please listen to your Real Estate Broker. They can save you months or years finding or selling your property and for the best price for you.
ACCESS
The best Real Estate Brokers are accessible. Meaning: you can phone or email or text them and they reply. But don’t abuse this. Your Broker doesn’t control the other side of the transaction. Give her/him time to gather information and then inform you. Trying to rush the other side can backfire. Let your Broker assess the personalities involved and let things play out.
DON’T DO NUTTY
You, as a seller should never demand that the buyers pay you for your remaining few sticks of firewood, or other junk you have left hanging around your house/land because you don’t want to have to relocate them when you move, that you believe would make you clever to squeeze some more tiny amounts of cash from the deal. You will make the buyers think you are a nut and also antagonize them and regard you as a penny-pincher and could actually screw up the entire deal. Don’t do it. The same goes for leftover paint, LP gas in tanks, water jugs, clothing and furniture you decided to leave that they did not agree to buy.
ADVICE
Before you do anything, ask your Real Estate Broker. They specialize in guiding you down the correct path to achieve the best results for sale or purchase. This is one of the best values of your Broker: wise advice. Colors of paint, materials, amount of furniture in the rooms (most people have too much which results in making things look cluttered: less is more).
AVAILABILITY
This applies to YOU as well as your Broker. Do NOT go on a vacation to Europe for a month when your sale is about to close. Be here. Be ready to deal with the unexpected.