When the Housing Bubble Bursts…,or, just slowly leaks air.
Patrick Newport, U.S. economist at consulting firm Global Insight in Waltham, Mass., said in a recent statement, "Interest rates have eased in recent weeks, but we are expecting them to drift back up over the first half of 2006," he said, adding that if the Federal Reserve raises interest rates two more times before pausing, the increases "will cool off the housing market and deflate many local housing bubbles."
It seems that everywhere you look today, a housing bubble burst imminent. So, what do you do if you want to sell your home in a slowing market? In a buyer’s market, pricing it the number one most important factor in selling a home. Obviously, anyone can sell their home by lowering the price enough to cause a sale, but for most home owners, this option leaves a bit to be desired.
So, to re-phrase the question, "How do you sell your home and still NET the most during a market slowdown?" Enter "flat fee mls" listing. A relatively recent entry to the real estate brokerage industry, a flat fee MLS listing allows home sellers to place their property in the Realtor MLS and on Realtor.com for an upfront fee (usually in the $500 range) instead of paying a whopping 6% commission at closing.
A flat fee MLS listing allows a home seller to lower their price and still, maximize their net return. Studies show that a MLS listing increases the odds of selling a home by providing the highest marketing exposure possible. Higher exposure means a greater demand and consequently a higher price.
Here’s how it works: Instead of listing with a traditional broker, find a flat fee broker offering MLS entry only listing of homes for sale. (for a nationwide listing of flat rate brokers visit www.MLSLion.com). A flat fee broker will enter your property into the Multiple Listing Service in your area where it can be viewed by all of the real estate agents as well as their buyers. If a buyer’s agent brings you a buyer, you pay them 1/2 of the normal commission amount, generally around 3%. For every $100,000 of your sales price, you save approximately $2,500. That means on an average $200,000 home, you can lower the sales price by about $5,000 and still net the same amount of money from the sale as if you had used a traditional real estate agent. Of course, all other factors being equal, a house selling for $195,000 sells before one selling for $200,000 in any market.
If you’re not ready to go the For Sale By Owner (FSBO) route, most flat fee brokers also can provide additional assistance for marketing, contract preparation and transaction management and closing. Flat fee MLS also provides significantly higher marketing exposure than FSBO. The reason is simple – most buyers go to real estate agents using the MLS to purchase a home. In fact, the most recent comprehensive study showed that over 75% of home buyer’s use a real estate agent when purchasing a home.
There’s usually little risk with flat fee MLS listing too, as many flat fee brokers will credit your upfront fee back if you allow them to refer you to a traditional real estate agent, should you change your mind down the road. It’s truly the best of both worlds. All of the exposure of a traditional real estate listing without the cost, or even the risk!
See Also
- Real Estate Journal
Homes Sales Fell in December, Condo Market May Falter
- Extreme home selling
As the market slows, home sellers are throwing in sweeteners to move properties…dual-mode toilets, anyone?
