When I get ready in the morning, I am usually listening to the radio getting the latest news etc.   This morning I heard an advertisement from one of our area’s discount real  estate brokers.   I’m sure you’ve heard the ads about lower commission rates.   The ad goes on to say that the company has done over $250,000,000 in sales.  Sounds impressive until you are an agent in an office that by ITSELF does over 500,000,000 in sales EVERY YEAR.   Never mind our entire company!

When I hear these ads I often wonder if people really consider what listing with a discount broker (or for that matter a transaction broker) might actually mean.   These brokers pay buyers agents the bulk of the commission and this leaves very little to the listing/transaction broker.   How much do you think that will buy the seller in marketing, internet position and relocation outreach?   Not to mention print advertising and time the listing agent will spend out of pocket on behalf of a seller – from print ads to photography and sometimes even some fixes or cleaning.

We have agents in our company that do more in volume and sales by themselves than one of these smaller brokerages.     And while big corporate entities are sometimes seen as cumbersome,  the clout a large corporation brings to the table for their clients can be invaluable.  This is especially true in Real Estate.  Being able to buy position on the internet so when buyers are looking online themselves, a company like Coldwell Banker Gundaker will pop up at the top of the list  means our listings will be seen before other smaller companies.  I also think that there is a comfort level and familiarity with known entities and this can give buyers and sellers peace of mind.

There is also the not so small detail of agent education and support.  This is HUGELY important when you put your largest asset in the hands of an agent.  Do they know what they are doing?  What kind of continuing ed to they get?  What kind of admin and legal support do they have?  Will a small brokerage have this support built in for agents?   I’ve written about being on the other side of deals with some of these smaller outfits and have been not so pleasantly surprised at the lack of knowledge agents exhibit.  Mistakes can cost a buyer or a seller a lot of money so make sure your agent is knowledgeable!

Some other things to think about when making these decisions:

1.  Anyone can put a home on line for a fee…what will drive buyers to your home?
2. What other websites, local, national and international will your listing appear on?
3.  How much print advertising and postcard mailings will a company/agent do for you?  These are all questions a prospective seller must ask themselves.
4. One other thing that is important to ask a broker or agent…what percentage of          listings actually sell vs. expire. 
5. And what is the original list price to actual sale price percentage? 
6. The other thing to look at or ask about is what is the average list price of the company.  This can be important if you have a home over 350K to sell and most definitely with upper end properties of 750K or more.

In the end the decision to sell your home is a very important one.  Make sure you are informed about the company and agent you are going to list with.  Saving money on commissions can cost you as much or more in sale price and pitfalls – so be aware!