May. 5, 2006 - The Story Of Gene And The Flat Fee Lister
Those who have been following my blog know that commission was my second most popular category. That is no longer true. Rants and raves have taken over the number two spot, while commission has fallen into third place. I have promised to tie the commission posts up with a good story, which I intended to do before I had to congratulate the folks in my last post, and here that story is.
Darrell Rosko, a good client of mine, was moving up in the world. We found Darrell a nice little townhouse when he wanted to stop renting and start owning. A wise move on Darrell's part.
After a couple of years of equity building and appreciation, the walls of this entry level townhouse began closing in on him and Darrell decided he wanted a more spacious detached single family home with a yard and a garage, so he gave me a call. Another wise move on Darrell's part.
We put Darrell's townhouse on the market and got a really nice price relatively quick. Appreciation and a good full service REALTORŪ are a magical combination. In the mean time we went out looking at potential homes. One of the places we looked at was listed by a flat fee lister.
You might recall from a previous post that a flat fee lister is a Broker that will put you in the MLS for a fixed price. That fixed price is lower than what you would pay a full service agent like myself, and you get what you pay for. If you list with a flat fee lister, you have to take the calls and set up the showing appointments and you have to call the showing agents for feedback. The only advantage you have over regular FSBO's (For Sale By Owner's) is that you are in the MLS.
As luck would have it, Darrell kind of liked the place, maybe not enough to make an on the spot offer, but he liked it. When the seller called me for feedback, as he had to do because he didn't have a full service agent, I was guarded with my comments, as is always the case. I never want to show too much enthusiasm for a property and hurt my clients negotiating position. Unfortunately for the sellers, and fortunately for Darrell, Mr. Seller, who is not in the business of buying and selling property on a daily basis, was not so guarded. He told me all about his motivation for selling. He was on a dead line and time was bearing down him like a run-a-way locomotive. His back was to the wall. He told me things a seasoned real estate professional would never say to a buyers agent.
Needless to say, I called Darrell and told him of the sellers multiple reasons for needing to sell and advised him that we could probably save a bundle if we made an offer on this place. We came in low, negotiated a nice under market value price on the place, and even worked out some additional concessions on the home inspection. All this because the seller wanted to SAVE money on commission using a flat fee lister. The seller could have paid a commission for full service representation and still put about $20,000 more in his pocket.
The sellers continued to call me with questions throughout the transaction. On each occasion I advised them that I was not their agent and they should be talking to the person who they listed with. Each time they told me that that was not a part of their limited service deal.
It's a good thing Darrell was properly represented, as are all of my clients, he got a really good deal.
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