By Lawrance Morrissey
Sometimes I feel like a broken record. I answer the same questions over and over with commonly asked questions regarding the MLS, real estate agents and the way people think real estate is done. I decided to share the most popular ones with my readers this month.
"I think I need to be on the MLS to sell my home."
No, you don't. Times are changing... You do need to expose your home to buyers though. Our advertising program not only competes against the MLS, more times than not, it outperforms it. The major dirty secret is that 1,000 homes a week expire on the local MLS. In fact, the success rate of MLS listed homes is only 50-60%! (Varies by neighborhood; of course.) That extrapolates to 5% of the MLS' entire inventory, every single week! In contrast, our success rate is about 80%, our customers sell just as fast, and they save thousands in commissions.
"I want to hire an agent since they are experts in real estate."
Not necessarily. Although real estate agents are recognized as being experts, very few are. It is believed that 10% of the agents do 90% of the transactions. I like to joke at my seminar that the two requirements to be an agent in Indiana are, you have to be 18 and breathing! In all seriousness though, earning a real estate license is pretty cheap and easy. Where else can one fork up less than $500 and less than 80 hours of time to be considered an expert? Anyone? Bueller?
"I want to leave the legal paperwork to professionals."
First, reread the paragraph above! The legal paperwork is not as difficult as agents would like you to believe. The reason most sellers are intimidated by the paperwork is because of their memory of their last closing. Sellers recall having to sign a mountain of paperwork when they purchased their home, so they instinctively think that much is involved when it's time to sell. Most of the paperwork they signed was the mortgage documents. At closing, sellers sign a fraction of what buyers have to sign, and the title company will prepare virtually everything for you. Normally, our customers only fill out 7 sheets of paper to get to closing; a 5-page purchase agreement, and a 2-page sales disclosure. Because by-owner transactions go so much smoother when agents are removed, we can offer paperwork assistance for a mere $295. For that fee, we'll write up your purchase agreement, order your title work for you and review your HUD settlement statement the day before closing. |
For those customers who would rather have an attorney handle the transaction, we recommend the Nice Law Firm for a fixed rate of $595. (See their advertisement on page 4.)
"I need an agent to price my home."
Actually, agents are not allowed to price homes. They can do a CMA (Comparative Market Analysis) to figure out the average price per square foot in your area, but that can be far from accurate. The best way to determine the price of your home is to have a certified independent appraisal done. (Refinance appraisals don't count.) If you prove the value of your home to potential buyers, you'll likely get offers that are much closer to your asking price.
"Why won't my agent host open houses every Sunday until my home is sold?"
The reason seasoned agents don't like to host open houses is because open houses do not typically sell homes. Open houses were created by real estate agents as a method of finding new clients. The success rate of selling a home due to having an open house is about 5%. Many agents who visit our retail store have admitted they have never actually sold a home through an open house. Often, the purchase of an open house directional arrow is accompanied with a groan. One agent who admitted never selling from an open house has been an active agent for over 30 years.
"My real estate agent hasn't shown my home one time! The only showings have been from other agents."
That's typical actually. Your listing agent will likely not sell your home. Many agents promise they will bring several buyers to your home AFTER you list with them. This is simply a sales line. The agent who lists the home is rarely the agent who sells the home. Our best estimates are that the listing agent sells the home about 2% of the time. Typically a new home is added to the MLS with about 30 minutes of data entry work. The listed home is then shown by buyer agents with live clients who determine your home meets their criteria. Typically, the listing agent is not involved at all, until an offer is made.
"I think it's valuable to have my agent at closing."
Sometimes it can be very helpful. Good agents always check the HUD settlement statement for errors, but better agents check them the day before closing. That allows time to make corrections especially when outside vendors are involved. The reality is if this is all done before closing as it should be, the agent has nothing to do at closing except exchange light banter and collect their 'hard-earned' commission check.
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