Flat Fee MLS Listings – Is this the future of real estate

Flat Fee MLS Listings – Is this the future of real estate

by: Richard Massey

Realtors are all a buzz about this new form of listing houses on the MLS (multiple listing service). Some feel it creates more work for the buyers agent, while others see this as a way to tap into the For Sale By Owner market.

It use to be when you made the decision to sell your home, you essentially had two methods available to you. You could list your home with a traditional real estate company and pay 6-7% commission or you could try selling on your own “for sale buy owner”.

Research shows that nearly 50% of all home sellers start out trying to sell their property on their own. Although some home owners are successful with FSBO, according to the National Association of Realtors (NAR) home seller survey, only sixteen percent of sellers actually sell their home without exposure on the MLS. And many of them end up giving away their commission savings to the buyer to close the deal.

Realtors tend avoid for sale by owner properties because they are working with buyers and have no written agreement to be compensated. If the seller has not agreed in writing to pay a commission to the agent, the buyer could cut the agent right out of the deal and negotiate directly with the seller. It happens….

With flat fee MLS service, the seller has agreed in writing to pay a commission, usually 3%, to the buyers agent. This motivates Realtors to bring the seller a buyer.

How it works:

Real estate commissions by law are negotiable. In a flat fee listing, the listing agent agrees to a flat fee instead of a percentage of the sale price. This can be anywhere from $300-$600 for the service of adding your house to the MLS. Then you choose how much to pay the buyers agent in commission for bringing you a buyer (typically 3%). So in the sale of a $200,000 house you would pay $6,000 plus the flat listing fee, saving a close to $5,700 in commissions. The plus side is in the listing agents contract, the right to continue advertising you house FSBO. So in the event you find a buyer without an agent you save on all commissions and only pay the flat listing fee.

• What do you get with flat fee MLS listing:
• Advertise your home on Realtor.com
• Market to buyers working with a Realtor through the MLS
• Market to Buyers working without a Realtor
• Retain your right to sell your property by owner
• Avoid paying any real estate listing commission by paying a flat rate or fixed fee upfront
• Only pay a commission if a buyer’s agent sells your home
• Why would a listing agent want to do this?

For real estate agents this can be an opportunity to increase revenue by listing more homes. There are many people who refuse to use realtors because of the 6-7% commissions, but are more than willing to pay 3%. With the increase of internet marketing, realtors can reach more people because all they are offering is to list the house on the MLS. Services are minimal and the listing agent really won’t be trying to find a buyer for you, but rely on the buyers agents. This allows them to list properties in a larger area and in some cases in other states.

With the increase of house prices, is the 6% sales commission going to survive or will flat fee listings be the wave of the future. Only time will tell…

Real estate market blows off some steam – Winnipeg Sun

Real estate market blows off some steam – Winnipeg Sun
Canadian existing home sales edged lower for the second straight month, as a cooling Vancouver resale market offset red-hot activity in Toronto, the Canadian Real Estate Association will be closely watched,” said CREA president Dale Ripplinger.

UPDATE 1-Canada home resales cool for 2nd straight – Reuters
The Canadian Real Estate Association (CREA) said a total of 42,799 homes changed hands last Housing markets are becoming more balanced,” said Gregory Klump,” CREA’s chief economist. After a relatively short spell of low consumer confidence during

A Guide to Investing in Real Estate

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With all of the investment opportunities available these days, it can sometimes be difficult to decide which one is right for you and your money. If you find yourself trying to make a decision about where your money should be invested, you might want to take a few moments to consider investing in real estate. While real estate investment isn’t right for everyone, there is a rather significant potential to make money if you handle your real estate investments correctly.

To help you to decide whether or not real estate investment is right for you, here is some additional information on investing in real estate for both resale purposes and rental purposes, as well as some of the advantages and disadvantages of this type of investment.

Investing for Resale

One common method of investing in real estate is investing for the purposes of resale. This method uses real estate in much the same way that other investors use stocks or similar investments; you purchase a piece of property and then attempt to sell it for more than you invested into it. Investors who buy and sell real estate in this manner will often use the money made from one piece of property to purchase another, keeping some real estate on the market as much as possible and keeping the excess money that was made from the last sale.

Investing for Rental

Another common method of investing in real estate is investing for the purposes of owning rental property. Instead of putting a house or apartment building back on the market after purchasing it, the rental investor finds individuals who are interested in renting their property and then serves as landlord. This type of investment doesn’t yield as much at one time as resale investments, but has the potential to bring in a somewhat steady return for months or years to come.

Advantages of Real Estate Investment

The advantages of real estate investment are much like the advantages of any investment… there is an opportunity to make money, sometimes large amounts of money. Resale investors can often purchase property that needs minimal repair, fix it up, and see a significant increase in their profits for not a whole lot of money. Rental investors can make even more over time, because as long as their property is occupied they’re going to be making money. Years down the road, they can also choose to sell their rental property for additional profits.

Disadvantages of Real Estate Investment

While there is a great potential to make money with real estate investment, it’s not without its disadvantages. For resale investors, they may not be able to find a buyer as quickly as they’d like, or the real estate market might drop after they’d made their purchase… either scenario meaning that they aren’t able to get the money out of the property that they want or in some cases not even able to get back what they put into it.

Rental investors have to deal with the people who are renting the property, as well as potential periods when no one is renting it… and are responsible by law for certain amounts of maintenance and repair even though it may be the tenant’s fault that the repairs are needed.

They also have to deal with non-paying tenants, and those who are quick to threaten legal action even if it’s not legitimate. Both types of investment also require payment of property taxes and other fees.

Money can be made with real estate, just make sure that you’re ready for the drawbacks as well.

You may freely reprint this article provided the following author’s biography (including the live URL link) remains intact:

About the Author

John Mussi is the founder of Direct Online Loans who help homeowners find the best available loans via the www.directonlineloans.co.uk website.