Discount and Fast Cash Brokers
With all of the discount brokers out there now offering buyer rebates and cheap listings, I felt as a professional real estate agent, I owed it to my profession to explain some things.
While on the surface it sounds like a great deal to list your home for a low fee or even get an immediate cash offer for your home, what is not apparent is all of the money you are potentially losing by using discount brokers or fast cash brokers (iBuyer).
These types of brokers are looking for a quick sale. It’s a numbers game. The less time they have to spend on you, the more money they make. And if they can buy your home well below market, they can resell it for a profit. Remember, they aren’t going to live there. They are going to resell it right away after they buy it from you. Think about it. The market is only going to pay market value for a home. So how can they buy it from you and turn around and sell it for market value? 1. They pay you less than market value and/or 2. They charge enough “fees” on your end to pay for their holding costs.
It’s all about the bottom line – for them, not for you.
Think of all the money you just left on the table by not knowing how much your home is really worth. It is very easy to manipulate comps to come up with a number that sounds reasonable to the the average homeowner. Their marketing sounds enticing and their presentation looks professional, so people take it for face value. They say they don’t charge commissions, which they don’t, but they do charge many different “fees” which are generally more than the standard 6% you’d pay with a professional broker. Many times 8% or more depending on the condition of the home. If you have an offer from a fast cash broker and it really is the best offer for your situation, I will tell you. But they usually only give you 24 hours to take it or leave it. Wonder why?
The only way to know how much the market will pay for your home is to put it on the market.
FSBO and 1% listing brokers also sound attractive because you don’t have to pay full commissions. But if you read the fine print for flat fee brokers, if they enter it in MLS, you will have to pay buyers agent commissions, generally 3%. So now you are at a total of 4% with no service and no one looking out for your money. They don’t care about getting you the most money, they just want fast money so they can move on to the next one.
The reality is that commissions are part of the market. Just like the cost of goods for any product includes everything that went into getting the product to the end user. The number of homes that actually sell by owner or with limited marketing and exposure are less than 10%. And most of those end up selling for less than they would if sold professionally – and usually with a lot of hassles and more exposure to liability.
Sticking a sign in the yard and throwing a listing in MLS doesn’t sell homes. There is a lot of leg work that goes into just getting a property ready to list. And it costs money and takes time to properly market a property for sale and make it stand out among the rest. The real skill comes in pricing and negotiations. No discount broker is going to do what it takes to get you top dollar. They can’t. Their business model doesn’t sustain it.
Think of it this way. If you have a complicated legal matter where your assets and money are at stake, would you print off some forms online, read a few posts and hope for the best? Or would you hire an experienced, qualified attorney to make sure you are protected? If you owned an expensive car, would you let you neighbor work on it to save you some money and possibly void your warranty? Sometimes what you think you are saving, you are actually costing yourself more than if you had hired an expert.
Before you rush into selling your home with a discount or fast cash broker, let’s meet. My goal is to always do what is best for my clients. I will review the market in detail with you, get your home show ready and help get you the most money possible in the sale of your home.
I will tell you now. I don’t discount my listing commission. BUT – I will earn your business by always looking out for your best interest and always working hard to get you the most money out of your home. Would you rather save $3,000 on a listing commission with a lot of unknowns, hassles and potential liability or would you rather sell your home for $20,000 more with a professional who will guide you every step of the way? Read my Reviews.
For buyers, the lure of cash back at closing sounds great. After all, you can see all the homes online anyway, so what do you need an agent to do? If you have ever purchased a home – and had someone working for your best interest – you will know that there is a lot more to a real estate transaction than being aware that a home is for sale.
Brokerages who give you money to work with them are showing you that they don’t need to earn your business. You are giving it to them with no expectation, except them throwing you a bone at closing.
As your buyers agent, I will work hard to make sure you get the best home at the best price. And I will always look out for your best interest through inspections, negotiations and to closing and beyond. I represent you! I can save you thousands and most importantly help you avoid costly mistakes that may cost you for years to come. Also, being a professional in the market, working full-time, I am able to spot opportunities. Just ask my past clients!
I have been in the real estate business for 15 years. Discount brokers and fad real estate trends come and go. People who go the extra mile for their clients and are invested in their business are the ones who are still around. That is why I choose to work under the RE/MAX brokerage. Not all agents can be RE/MAX agents. RE/MAX 1 in Cedar Park is a professional brokerage that holds their agents to the highest standards and I like that.
Here are some examples of my recent transactions. Take a look at how much I was able to save my buyer clients and how much I was able to make for my seller clients through in-depth market knowledge and expert negotiations.
Little Elm Trail, Cedar Park – Sold for full price first week on the market. Highest comp in the neighborhood.
Hathaway, Austin – Sold for full price first week on the market. Highest comp in the neighborhood.
Rogge Lane, Austin – Sold for full price first week on the market. Even with paying money towards buyers closing costs, still the highest comp in the neighborhood.
Spicewood Club Drive, Austin – Sold for full price first week on the market. Highest comp in the neighborhood.
Townsman Trail, Cedar Park – Sold for $2,000 over asking first week on the market. Highest comp in the neighborhood.
Woodhollow, Cedar Park – Multiple Offers. Sold for $6,000 over asking first week on the market.
Brighton Place, Round Rock – Sold for $2,600 over asking. Highest comp int he neighborhood.
Ranch at Brushy Creek, Cedar Park – Sold for $47,000 over asking with multiple offers. List price was above last comp.
Settlement Dr, Round Rock – Sold for list price. Did not pressure sellers to reduce the price, just watched the market and held out for the right offer.
S Gadwall Ln, Cedar Park – Purchased for $10,900 below list price ($20,900 below original list price.)
Atlanta Park Dr, Georgetown – New Build, Purchased for $9,900 below list price ($47,763 below original list price.)
Gray Heron, Pflugerville – New Build, Purchased for $25,000 below builders list price and negotiated extra incentives.
Settlement Dr, Round Rock – Negotiated price down by $8,950.
Pampas Ricas, Leander – Negotiated price down by $9,500.
Fall Creek, Leander – Purchased for $10,000 below list price ($40,000 below original list price.)
Red Ranch, Cedar Park – Purchased for $16,000 below list price ($21,990 below original list price.)
Coulee Dr, Leander – Purchased for list price after numerous reduction of $25,100 from original list price. Seized an opportunity.
Pine Portage, Leander – Purchased for $2,000 below list price and negotiated $6,500 in buyer closing costs paid.
Woodstone Ln, Cedar Park – Purchased for $5,000 below list price and negotiated a new roof after inspections.
Pine Portage, Leander – Purchased for $7,000 below list price.
Canadian Cove, Leander – Purchased for $14,800 below list price.
Ran Rd, Leander – Purchased for $14,900 below list price ($21,500 below original list price.)
Doris Dr, Cedar Park – Purchased for $28,000 below list price.
Kristi Ln, Liberty Hill – Purchased for $5,000 below list price (20,000 below original list price.)
Charles Dickens Dr, Pflugerville – Purchased for $2,000 below list price and negotiated $3,000 in buyer closing costs paid.
*For the privacy of my clients, house numbers and sold prices not listed.
Read more about how I help my buyers purchase New Construction Homes.
So, before you rush into something that sounds like a good deal, take some time to research all the fine print and do your homework. Don’t leave your money on the table.
Would you go to a butcher for a major medical procedure? Would you take an easy pill because someone told you it would cure all your ailments? Would you dump all your savings in the next big thing because some guru told you you’d get rich quick? No! Buying and selling a home is one of the biggest financial transactions in your life. Use a professional.