Posts Tagged ‘Multiple Listing Service’

real-estate-dual-agency-buyers-and-sellers“So what will it cost us to secure your services?”  One of the top questions that I receive.  The answer may vary depending on the services you request.  For the purposes of this 3 part series, I will let you in on Renter’s Agent, Buyer’s Agent, and Seller’s Agent pay.  According to the 2013 National Association of Realtors Member Profile, “In 2012, the typical agent had 12 residential transaction sides – up from the previous year when the typical agent had 10 transaction sides.”  Traditionally, the real estate industry is completely commission based.  Most of the time, a Realtor works under the supervision of a broker unless they are a broker themselves.  In that case the broker may have their own company or work with a large, well known company like Keller Williams for example.  There is also the option for a Realtor to work on a team within a larger company.  All of these folks require payment.  So realistically, on one real estate transaction, there is the potential for the commission to be split 6 different ways before it is all said and done.  Let’s take a look at the Buyer’s Agent…

The Buyer’s Agent.  This agent does not cost the buyer a dime in this area.  As I talk about in 6 Reasons NOT to Call the Realtor on the Sign, my services to you as a Buyer Representative are practically free.  The commission percentage is agreed upon between the seller and the selling agent.  Generally, the selling agent will agree to split that commission with the buying agent, so you my friend, are off the hook!  All of my expert assistance, with no money down!

There will be a Buyer Representation Agreement.  A Buyer Representation Agreement details my duties to you as your agent, yours to me as a buyer, and that we mutually agree to work with each other.  I agree to work as your representative, and you agree to be represented by me.  It also specifies things like the length of time that the contract is good for, what type of home you are searching for, and the sources used for the search.  According to the Tennessee Association of Realtors® (TAR) Consumer Guide to Agency Law in Tennessee, “Once you have signed a Buyer Representation Agreement, this contract obligates your agent to be your loyal advocate and to promote your best interests above all others in the negotiation and closing of a successful purchase.”

This part is important to us Realtors, and I think you will be able to see why.  I’ve only had it happen once, but it still stings.  A potential buyer contacted me months before their anticipated arrival.  There were some specifics that they required in a home.  I searched, and searched, sifting through listing after listing (hundreds!) to find the right ones to show them.  Hours of my time before they ever arrived.  I answered their questions, blocked my time for them in preparation for their arrival, and was completely dedicated to easing their transition.  To make a long story short, they didn’t want to sign my Buyer Representation Agreement when they arrived, even though I agreed to write in the special stipulations that I would let them out of it if they so desired.  For three days, I searched for homes, arranged showings, and took them to see houses.  We drove from one end of Clarksville to another, and I held other clients off out of loyalty to the time I had blocked for them.  On the fourth day, after arranging another evening of house hunting, they stood me up.  Property transactions are noted in our Multiple Listing Service (MLS), and are ultimately public information.  It wasn’t long before I discovered that they had bought the very first home that I showed them.  Hours, and hours of my time wasted.

But moving forward, how is a Buyer’s Agent paid?  We find the home you love, and go under contract.  On the MLS sheet, the compensation amount is listed.  This is a percentage that is split between the Seller’s Agent and the Buyer’s Agent.  Then, as I spoke of above, this is split with the agent’s broker, and may even be split with the agent’s team if they are on one.

Here is an example:

The price of the home is $100,000.  The commission is 6%; 3% to the Seller’s Agent, and 3% to the Buyer’s Agent.  The brokerage split is 70/30.  The royalties to the company are 5%.  And then the split to the team is 40%.  The paychecks may look like this;  $900 to the brokerage, $150 to the company, and $780 to the team.  That potentially leaves $1170 to the Buyer’s Agent before taxes.

Buyer’s Agent Expenses. So dang, those agents make a lot of money, right?  Hold your horses!  On top of our split, we have all of these additional expenses and then some:

  • Various taxes
  • Office fees
  • Office supplies
  • Realtracs subscriber fees
  • Advertising (signs, websites, business cards, etc)
  • Clarksville Assocation of Realtors dues
  • Tennessee Association of Realtors dues
  • National Association of Realtors dues
  • Dues for other professional organizations we may belong to
  • Closing gifts to our buyers
  • Electronics (computers, cameras, etc)
  • Phone bills
  • Vehicle maintenance
  • And the worst of all… GAS (sometimes multiple times per week)!

Bonuses.  I will let you in on one last little secret.  Everything in real estate is negotiable.  Sometimes if a particular listing has been on the market for a long time, or if the seller is motivated to get the home sold quickly, they may include a bonus to the Buyer’s Agent.  These bonuses can range from hundreds of dollars to thousands (even tens of thousands) of dollars, and it is not something that you as the buyer are usually aware of.  Though any payment amounts are noted on the final HUD that you will receive before closing.  The seller and listing agent can also agree to pay a higher commission percentage as an incentive to the agent.  Keeping that in mind, if you have an agent who is passionate about the families they help, and not particularly money driven, they may opt to forgo the additional bonus or lower their commission amount to get you the deal that you want.  Not tooting my own horn, but I have done this for my clients.  I have let a few bonuses go to get my buyers the most and there are a few other like-minded agents out there.  Disclosure is the best practice in my opinion, and I do not try to keep those sorts of things concealed.  After all, realtors can offer their opinions, but we cannot make you buy a particular home.

Be sure to read Realtor Pay Exposed (Part 1 of 3): The Renter’s Agent and Realtor Pay Exposed: The Seller’s Agent (Part 3 of 3)

Does that break it down for you?  Questions?  Concerns?

If you have questions or need real estate assistance in the Clarksville, Tennessee or Fort Campbell, Kentucky area or know anyone who does, call me today at (931) 436-6765 or submit your information below.

© Ariel Anderson and, 2014.  Unauthorized use and/or duplication of this material without express and written permission from this blog’s author and/or owner is strictly prohibited. Excerpts and links may be used, provided that full and clear credit is given to Ariel Anderson and with appropriate and specific direction to the original content.

Home EquityYour house has been sitting vacant, or maybe you are days away from moving.  You’ve got that nagging in the back of your mind, “We need to sell! We need to sell!”  I can detail for you several ways to make sure you don’t sell your home!  Read on for a few very recent, as in the last 30 days, situations I have personally encountered:

In Tennesee, when an offer is put in on a home for sale, there is a Time Limit of Offer in the Purchase and Sale Agreement.  The time limit can be as short or as long as the buyer would like.  Usually 24 hours is a reasonable amount of time for a response.  If the contract is not accepted or countered within that time frame, the offer terminates, and the buyer is free to move on.

We all know offers are frequently made in the evenings or on the weekends.  That’s just the name of the game in the real estate world.  So, we put an offer in on a home with a 24 hour time limit.  Two hours before the offer expired, I (working as the Buyer’s Agent) touch base with the Listing Agent.  “Have you heard anything from your seller?”  No response.  Tick, tock… tick, tock… 30 minutes before the expiration, I call.  “Just trying to touch base, let me know what your seller thinks.”  Nothing.  At the exact moment the offer expires, a text message from the Listing Agent, “He’s doing a counter now.”  Well, guess what?  Too late!  The offer is technically terminated.  Now some buyers and Buyer’s Agents will understand, and continue to move forward with the counter offer.  But some will move on to the next home.  The lack of communication and timeliness potentially costing you the sale of your home.

This same home was listed on the Multiple Listing Service (at least it was listed!), though there were no updated pictures of the new carpet and paint.  And most importantly, it had been on the market for nearly two months with no “For Sale” sign in the front yard.  When I went to show it, my buyers even asked, “Are you sure it’s for sale?”  You can imagine how detrimental that can be to the sale of a home.

At another home recently, I arrived to show it to a couple of potential buyers.  There was one problem; no lockbox on the front door.  No instructions in the MLS.  I call the listing office and whoever answers the phone sounds exasperated.  “Did you look on the back door?!”  Ummmmm, this is a new construction home, no sod or grass and it rained about 8 inches in the last 24 hours.  Do you really want me to treck through 5 inches of red clay mud and then walk through your new construction home?  “The builder is about 10 minutes away, he’ll let you in.”  Click.  Tick, tock… tick, tock… 10, 9, 8, 7…  10 whole minutes (or longer) for my buyers to say, “Nevermind, it’s getting dark, let’s go look at something else.”  Potentially costing you the sale of your home.

This same home did not have a lot number displayed visibly.  Anyone who has been out looking at new constructions without a plat map will understand how frustrating this can be.  Additionally, the flyer for the home displayed the incorrect address and list price.  All of which have the potential to cost you a sale.

Another lockbox scenario:  The home for sale is occupied, and I make an appointment to show.  I show up at the home with my buyers, and I can see the lockbox on the front door through the tightly secured and LOCKED glass of the storm door!  No way possible to access it.  So I call the appointment line, who calls the Listing Agent and says they will call me back.  Tick, tock… I call the Listing Agent and leave a message.  No response.  5 minutes go by out there standing in front of the home with buyers.  “Ok, well why don’t we head to the next home on the list.”  Moving on.  Two hours go by, we are well into our home search, and the Listing Agent calls back and leaves a message that the door is now unlocked.  We are on the other side of town and they’ve already found a home that they love.  No thank you, maybe next time.  The lack of communication and timely response which ultimately may have cost you the sale.

Not a lockbox this time, but another lock situation and another new construction home:  We are out and about in the neighborhood.  There are several nice homes that my buyer likes, but we just haven’t found “the one” yet.  I think back to all of the homes I have been inside of in this particular neighborhood, and I say “You know what?  I know you don’t prefer a corner lot, but there is one more out here I think you would like.”  We head over and I access the lockbox and the key fits, but I can’t seem to get the door to unlock.  I wiggle, and jiggle it to no avail.  I go around to the backside and try the backdoor.  No luck.  I call the Listing Agent who DOES answer, but says, “Yeah, I’m aware.  It is difficult to open but keep trying.”  So I do.  Turns out, this one is nice, but not the one for her.  A little over a week later, the same scene.  I have a different buyer, and cannot get the key to turn.  Frustrating!  Why hasn’t this been fixed?!  If it were my listing, I would’ve gone out and changed the lock myself!  I was almost over it, when I inserted the key and twisted once more.  Voila!  It opened.  I am writing the contract on it today.  But how many agents would have stayed and continued to try to open the faulty lock?  Especially when there are 80 other new construction homes available within a mile radius.  There certainly was not timely follow-up, which potentially may have cost you the sale of the home several times over.

Final scenario:  The unhappy sounding, unhelpful agent.  “Good afternoon!”  I say.  “I was out at your listing with my buyer and she is interested.  Is there anything else you can tell me about the home?”  Silence.  “Ummmm, have you had any activity?  Any offers?”  I ask again.  Distractedly, she responds, “Yessss.”  Ok, I think.  This isn’t going far.  “Well, can you tell me anything else about the home?”  Silence.  Possibly even typing in the background.  Again, sounding distracted she says, “It has new carpet and paint.”  I sit there for a moment, yes we saw that on the MLS, and out at the home just now, I think to myself again.  Ok, clearly this conversation is going nowhere.  “Thanks for your time.  Have a good day.”  I explain to my buyer that I can’t offer her any other information, and we move on.  No follow-up or feedback requests that potentially cost the sellers the sale of their home.

Before I tell you the #1 way to sell your home, think about all the factors you consider when it comes time to sell.  You may have been told:  stage your home, clean it, unclutter, price it right, it might not be possible in a market that is down, list it with a popular company or team, hold frequent open houses, etc.  But really…

The #1 way to sell your home is to find a Listing Agent that you can communicate with.

Think about it… Can you get ahold of your Listing Agent at all reasonable times?  Or at least get a timely return call and regular follow-up?  If not, neither can your potential buyers!  Call the listing office and pretend to be a buyer.  Ask for information on the home.  Are they friendly and helpful?  Are you put on hold for 5 minutes?  If so, then it is likely potential buyers will be disregarded too.  Follow up.  Is the sign in the yard?  Lockbox on the door?  Are the flyers accurate?  A great agent will ensure all of these things from the start, but with communication between you and the agent, as well as between the agent and potential buyers can go a LONG way!

It will be much easier on you and everyone involved if you get it right from the start.  Make sure that in the beginning your listing agent is worthy of being HIRED instead of fired later down the road and after money spent.

Cardboard sign with the words "Fired", "Hired

If you are seeking or interested in selling real estate in the Clarksville, Tennessee or Fort Campbell, Kentucky area or know anyone who is, call today or submit your information below.

© Ariel Anderson and, 2013.  Unauthorized use and/or duplication of this material without express and written permission from this blog’s author and/or owner is strictly prohibited. Excerpts and links may be used, provided that full and clear credit is given to Ariel Anderson and with appropriate and specific direction to the original content.