Author Topic: When are you committed to a listing agent? Advice please!  (Read 1908 times)

NoWorries

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When are you committed to a listing agent? Advice please!
« on: January 25, 2016, 11:38:21 AM »
We are selling our house and this is the first time we've sold a home. I spoke with one listing agent a few weeks ago. She come out to the property and gave us an estimate of what she would list it for. YIKES!!!! Her estimate was incredibly lower than what we expected.

We contacted another agent and she came out to our house. She gave us an estimate that is directly in line with what we expect our house would sell for (the house 2 doors down is for sale, and we've looked at other comps too), and she's a more established agent with a more popular agency.

The first agent quoted 5% commission and the second quoted 7%, but she agreed to 6%. Even at the 1% higher commission, we will be making so much more from the second agent.

Questions:
When are we committed to an agent? We haven't signed any documents with either.
Any general advice or advice concerning this situation that I haven't addressed?

Thanks fellow Mustashians!

iamlindoro

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Re: When are you committed to a listing agent? Advice please!
« Reply #1 on: January 25, 2016, 11:57:13 AM »
You're not committed until you sign documents to that effect.  You have no obligation to either at this time.

One thing to note is that a 7% commission is ridiculous.  It is likely that that agent is only setting so high a commission in order to give the seller a feeling that they have "gotten something" by negotiating down to 6, which is the standard commission most places.  I would push hard to get her down to 5%.
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GizmoTX

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Re: When are you committed to a listing agent? Advice please!
« Reply #2 on: January 25, 2016, 11:57:54 AM »
You are committed when you sign the listing agreement. Read it very carefully. Have it reviewed by a real estate lawyer if it's not a standard contract approved by your state.

An estimate is just that, not a guarantee. The market, the location, & the condition of your property determine your actual sales price. If you choose the higher commission agent, make sure you understand what s/he will be doing to justify you paying more.

Another Reader

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Re: When are you committed to a listing agent? Advice please!
« Reply #3 on: January 25, 2016, 11:59:25 AM »
You are hiring someone to work for you.  Until you sign a listing agreement, you are conducting job interviews.  Start with the three agents that list and sell the most homes in your neighborhood.  Agents from across town are not going to understand the comparable sales in your neighborhood.  Ignore Zillow's "premier agents," that's a list of people that pay extra to get top billing.  Ask each of the agents you decide to interview for a competitive market analysis.  Ask them about the comparable sales that they used.  Ask them how many properties they listed or sold in the last year.  Ask them about staging, pricing strategy, and what they would do to your house to get it ready to sell.  Ask them if they have people they recommend to do any pre-sale work - painting, cleaning, landscaping, etc.  Get references and call them.  Then, pick the best candidates and discuss commission, which is negotiable.   

Krolik

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Re: When are you committed to a listing agent? Advice please!
« Reply #4 on: January 25, 2016, 02:49:00 PM »
We recently bought a house with Redfin. As a buyer we received part of their commission back. From what I was told they take only 1.5% commission when listing homes plus standard commission for buyer's agent (3%) so seller has to pay 4.5% (instead of 6%).
I don't know how good they are for selling homes but for me as a buyer it was smooth and really good experience.
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NoWorries

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Re: When are you committed to a listing agent? Advice please!
« Reply #5 on: January 25, 2016, 07:49:12 PM »
6% is the total commission, so 3% would be to the seller's agent and 3% to the buyer's agent. It is 1% more than the 5%, but she's an awesome agent and sells a lot of property. I don't mind spending a bit more on someone who will work hard to get it sold quickly.

zephyr911

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Re: When are you committed to a listing agent? Advice please!
« Reply #6 on: January 27, 2016, 02:53:21 PM »
Until you sign an agency agreement, there's no commitment.

Note that neither of these agents' off-the-cuff estimates have any bearing on what a buyer is willing to pay, and if you tell Agent A to list for Agent B's price, they have to do that.

Ultimately, people make these decisions based on trust. An agent has a fiduciary duty to act in your best interests at all times. Hire the one you believe will actually do that. The good ones aren't going to move much on commission, other than friends/family deals, because there's demand for their services, and the REALTOR(R) subculture inculcates a belief that it's a betrayal of the profession. But yes, commission is 100% negotiable, and you're free to haggle.

I'm an agent myself, btw... mostly so I wouldn't have to go through one when buying investment property. :)
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NoNonsenseLandlord

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Re: When are you committed to a listing agent? Advice please!
« Reply #7 on: January 30, 2016, 06:19:29 AM »
Until you sign, you are not obligated.  Commissions and listing price can all be negotiated and you have the final say.  Thee should be no difference in any proceeds or net amount that you receive between agents, if they are the same commission rate.

No one can sell your home higher than market, but some can try and see what the actual market price is.  Try it a bit high, and have regular price reductions if you have to.

boarder42

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Re: When are you committed to a listing agent? Advice please!
« Reply #8 on: January 30, 2016, 06:48:41 AM »
All an agent does is get itnin mls. Educate yourself on the comps and figure out what price you should list at. It's the biggest racket since the mafia. I researched my area and found a listing agent that provided full service for a flat listing fee(only if it sells) and a 3% buyers agent fee.

Your house sells it self you just need the exposure of mls.

Also open houses only benefit your agent they use YOUR House to meet new potential clients. They really don't benefit you in any way.

Can't wait til this industry falls apart. The only place I think they serve a purpose is if you're relocating and don't know the city you're movi˝g to. But then you shouldn't buy you shouldn't rent for a few years to figure out where you really want to live.
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zephyr911

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Re: When are you committed to a listing agent? Advice please!
« Reply #9 on: February 01, 2016, 11:19:56 AM »
All an agent does is get itnin mls. Educate yourself on the comps and figure out what price you should list at. It's the biggest racket since the mafia. I researched my area and found a listing agent that provided full service for a flat listing fee(only if it sells) and a 3% buyers agent fee.

Your house sells it self you just need the exposure of mls.

Also open houses only benefit your agent they use YOUR House to meet new potential clients. They really don't benefit you in any way.

Can't wait til this industry falls apart. The only place I think they serve a purpose is if you're relocating and don't know the city you're movi˝g to. But then you shouldn't buy you shouldn't rent for a few years to figure out where you really want to live.
Damn, you mad bro?

I'm no mindless shill for the Realtor cult, but what you're saying is only partially accurate, and only for some cases. If self-service was really that easy, we wouldn't see 80% of FSBO sellers eventually list with an agent like they do.

I'm well aware of the games that some agents play, and I have real issues with the culture. I hate the upselling, the smarminess, the tendency to push for a quick sale over best client value - you name it. But there's way more potential value added than just an MLS gateway. Negotiation theory, best practices, service provider networks, expectation management, detailed and accurate market research, and additional exposure (outside MLS) through various advertising tools are all examples. I'll be the first to tell you that if you don't need those things, or your agent can't deliver them, walk away and DIY or hire someone else. But many people genuinely want that help and don't mind paying for it. To each his own, I say.
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