Will, a discount brokerage save you money at the end of the day when selling your house ?
Transcript of Video
Hello everybody. This is Mark Schreier with century 21 American Homes and today's topic is will a discount brokerages save you money? For total disclosure. I want to tell you that I will be looking down every now and then on my computer screen because I made a lot of bullet points and I want to make sure I cover them. This is a very important topic. It's one that's asked many a time. A lot of people consider a discount brokerages and I totally understand why because everybody's looking to save money, uh, if they can. So let's discuss it piece by piece first. What is a discount brokerage company? A discount brokerage company is basically a company that charges less and claims they'll get the same job done. Does that make sense to you? It doesn't make too much sense to me that people can charge significantly less and actually get the same results.
Well, let's dig into it a little more. How do these companies charge a lower brokerage fee and stay in business? Again, if they're charging less, is gotta be something they're cutting back on to stay in business and one is they reduce their services. How do they do that? Well, a couple of ways. One is they won't put your property on the MLS, and if you're familiar with the multiple listing service, it has one of the largest buyer pools linked to it. It goes on every single website and every single a realtor, not all real estate agents are Realtors, but every single Realtor has access to the MLS. And that is a significant way to get your house maximum maximum exposure. So if they don't put it on the MLS, they're just listing it, either a on craigslist, Zillow, Trulia, all of the above, maybe just one, maybe none.
Uh, some companies just put it in what they call an exclusive market for their particular company. If they have the, you know, they have an email that goes out, they send it out in every agent in their company will have access to your house that's been on the market. And if they have a buyer attached to them, which they could, then you have a chance of making a deal that way. But something to keep in mind. They're limiting it to their internal um, agents. Next thing, excuse me. And if an outside agent was to bring a deal, somehow the outside agent found out about this listing because they went on craigslist or they went on Zillow or some other, um, media that they found it on or word of mouth and they brought a buyer because it's not on the MLS. That agent is going to, is going to be hooked up as a buyer broker contract.
And they will say, I require x amount of percentage points or x amount of dollars to bring my bio to you. And then this discount that you had now becomes a much less of a discount. The next thing that you're going to do. And the next thing that will happen is you starting to understand now that by doing these things, they significantly reduce the buyer pool because everybody on the MLS, the majority of the agents have a significant amount of buyers that are waiting in the shadows that they know. I'm looking for this house, whether it be a ranch, a splanch, a split, three bedrooms, two bath, this school district, they have them waiting in. They're waiting for that property to come on the market so they can bring their buyers to it. They're looking and doing the work for their bias. Or the buyers don't have to be looking at their phones and at the MLS, um, every day or sometimes every hour to see what's coming up for them.
Uh, the agent does the work for you. The other way that you can have a reduced, um, brokerage fee is a flat fee brokerage. And what a flat fee brokerage does is they tell you upfront, they're gonna charge you, let's just pick a number out, $600 to list your house for three or four months. They'll put it up on the MLS, but you now become the agent. All phone calls and all inquiries go to your phone number. You deal with, um, setting the price. You deal with the photos. And on the note of photos, they are very, very important to have professional quality photos put out on the mls because that is the first place majority of buyers will find your house. And if you have poor photos, they might just go buy it and say, that doesn't look nice just because you had the wrong angle.
Or you had, you know, something like the toilet seat up when you took a picture. Something as silly as that. So make sure you get professional photography done as well. Um, all buyer's agents have to call you. I mentioned that. And you handle all open houses, transactions and deal with home inspectors, attorneys appraises, et Cetera. Do you really walk away with more money? At the end of the day, you're gonna do the math. If you have reduced exposure by all the means I just explained and you possibly set the wrong price, whether it be too high or too low, you're going to most likely end up with less money in your pocket. And that even though you might've paid less for the commission up front, the fact that you're getting a lower sales price at the end of the day you do the math, does that actually equal more money or less money that was charged for this transaction to take place?
And on that note, full-service brokers just give you a quick outline of what they do. They charge nothing up front unless the house sells. They have a very large marketing budget that gives your property maximum exposure and remember, maximum exposure, larger buyer pool chance of getting a higher price for your house. And let's say they're all trained to negotiate the best deal. We know the Lo the local market better than anybody else. Most of the discount brokers, some of them are from other states, they just post it up online. They look at a couple of 'em listings, um, maybe on the mls or on Zillow, but they really have never been in the house and they don't know those properties. They don't know the niche areas in the neighborhood that some of these neighborhoods, some of these little blocks pull more than than other blocks in an area.
And we can give you a custom marketing plan to get the job done. So with all that information now on your side, you do the math and answer the question, will a discount brokerage actually save you money at the end of the day? Give me a thumbs up if you like the video again, thumbs down if not so good and please subscribe to the channel. Thanks for watching.
Hello? Yes, I'm talking to you, the person that watched my video to the very end. Thanks a lot for watching. If you enjoyed it, please give me a big thumbs up. Subscribe to my youtube channel like me on Facebook. I am a licensed real estate agent in New York state, but I also have a referral service that deals nationwide. So if you're looking for to buy or sell a house anywhere in the United States, please send me a text, contact me via phone, and I'll set you up with a local professional in your area. If you're in my facility, I'd be more than happy to help you out in any of your real estate transactions that you'd like. This is Mark Schreier from century 21 American Homes, and I'll talk to you soon.
