Report #2
SELL YOUR HOME THRU AN AGENT WHO CHARGES A 2% FEE?
Selling a home is difficult and challenging work, much of which comes after the home is in escrow. It’s also a costly and very time-consuming job. Real Estate Agents know this and they’re definitely not stupid, so no one would list property for a flat 2% fee unless they knew there was an upside and you need to understand exactly where that upside comes from!
So how does this work? The only way you will actually pay a 2% commission is if this Agent finds a Buyer by himself without another Agent being involved. Any other Agent who brings in a Buyer, will require a 2½-3% commission for his efforts. And where do you imagine the dollars come from to pay that 2½-3%? Following is an explanation of how this game plan works and how it hurts you:
(1) The Preferred Way The listing Agent must sell your home to a Buyer he has personally found. His Buyer will first sign a “Buyer Representation Agreement” to pay him a 2%-3% commission for “finding” a home for him. So there is actually a 4%-5% commission being paid on the sale of your home.
But there is a big downside here. By law, this Agent must represent both the Buyer and the Seller’s best interests during contract negotiations and that can often lead to a nasty conflict of interest. While “Dual Agency” is not illegal, it doesn’t occur very often because the California Association of Realtors discourages this practice. In fact, it’s such a heavily litigated area of law that it is illegal in eight states. You might want to Google “Dual Agency” for further guidance.
You will end up losing more than you realize.Remember, this is a transaction between Seller and Buyer. If a Buyer pays $500,000 to you and $15,000 to the Agent, they have paid a total of $515,000 for your home. So your home was sold to a Buyer for $515,000, (THIS IS VERY IMPORTANT), but you only received $500,000.
(2) The Alternative Way An outside Agent can bring in a Buyer. The only way this Agent can be paid is for him to add his 2½%-3% commission on to the price he offers for your home. So now your only choice is to pay that 2½%-3% plus the 2% to your Agent or walk away from the deal. That leaves you to hang in there with your 2% listing Agent and hope that eventually something good happens.
But that is still a big downside. There is no denying that whatever your home is sold for, that 4%-5% commission paid to the Agents, will ultimately be deducted from the sale price of your home because once again, your home was sold to a Buyer for $515,000, but you only received $500,000.
You might as well have listed for the standard 5%-6% commission and received the added value and protection that listing would have given you. What added value and protection do we offer? Quite a load, actually! Please do us both a favor and read Report #5 on this web page titled "How Coldwell Banker Consistently Outperforms the Competition", or go to www.jimmoranbrokerage.com and check the “The Difference” tab at the top of the page. You’ll be surprised at what you’re giving up!
THIS IS KNOWN AS SELLING THE SIZZLE, NOT THE STEAK
The idea is to get the Seller to focus on the sizzle of a 2% commission and they won’t notice that what’s creating that sizzle ends up being pretty much the same thing that everyone else is offering. The takeaway here is that you get what you pay for and there really is no such thing as a free lunch! (And you thought that was just a cliché.)
But the trade-off is that in exchange for a relatively minor potential financial gain, you take on the problem of Dual Agency. How can an Agent protect the interests of his Seller who wants to sell for the highest price and his Buyer who wants to buy for the lowest price? That is the dictionary’s definition of “conflict of interest”.
WHAT IS THE DOWNSIDE OF LISTING YOUR HOME FOR 2%?
(1) There are severe limitations on the dollars available for promotion and advertising and that results in dramatically limited outreach on your behalf. Without the funding necessary to properly advertise and promote your property, these Agents are forced to assume a far more passive role. Their primary effort is to put everything up on the internet and hope they snag a browsing Buyer.
2) Our experience shows conclusively that the longer a property remains unsold on the MLS, the less the likelihood of obtaining the full asking price. Properties new to the MLS, create a burst of Buyer activity and interest. Homes remaining unsold after the critical first 15 days, raise questions in people’s minds. They become stale fruit and potential buyers move on to fresh opportunities.
(3) Realtors are the people most responsible for controlling the greatest number of active Buyers in the marketplace. In fact, 92% of all closings involve a Realtor. But no Realtor would ever introduce their qualified Buyer to your home unless they were assured of adequate compensation.
(4) As delays become critical, the Seller must add more dollars to advertise and promote the sale of his property and the benefits of the 2% listing become more and more illusory.
COLDWELL BANKER CAN LIST YOUR HOME FOR A 2% COMMISSION
We’ll do everything that the other companies do, which is basically to put your home into the MLS and up on the internet with Zillow, But with our advertising and promotions budget being so drastically cut, we’re just gonna need to eliminate some of the bells and whistles we always included with our usual listings. Such as:
(1) No Free Home Warranty to protect your home during the sale
(2) No Free $500 1 year Home Warranty for the Buyer after the sale
(3) No Free Certified $400 Home Inspection prior to listing
(4) No guaranteed sale of your home
(5) No guarantee of minimum proceeds to you at close of escrow
(6) No full page color ads in the largest circulation Real Estate magazine in California
(7) No custom website with your own address as the URL
(8) No coverage of your home on our Sunday TV show
(9) No professional magazine quality photographs
(10) No large glossy tri-fold brochures mailed out within your zip code
(11) No linkages to 900 websites such as Facebook, Google and Linkedin
(12) No multiple Open Houses
(13) No color newspaper ads
(14) No mobile brochure connections from your For Sale sign
(15) No Concierge Services from our certified contacts and tradesman for both Buyer and Seller
REMEMBER WHAT THE IMPORTANT ISSUES ARE
(1) Sell your home for the highest possible price in the best possible time frame. Not necessarily the price you’d like, but the price the market dictates…….and then get on with your life.
(2) Escrow can provide you with a “Seller’s Net Sheet”, which lists all foreseeable charges and expenses which would normally accrue in the sale of your home. Then you will know the size of the check you will walk away with when escrow closes. No surprises.
HOW CAN WE HELP?
Decide the price you need to receive for your home. The listing price could be determined by adding the real estate commission (usually 5%-6%), on top of that number. You will always be in complete and absolute control because you can reject any offer that does not meet your requirement for a predetermined minimum return to you at close of escrow.
I have been a California Broker for over 30 years. You may check any Realtor’s records by entering their license number at www2.dre.ca.gov/PublicASP/pplinfo.asp. My License Number is 00904384.
WHO ARE WE? SIMPLY PUT: THE LARGEST AND MOST TRUSTED!
(1) Ethisphere is a consumer watchdog group that tracks the corporate behavior of major companies and examines and analyzes how they conduct business and interact with the public. They have designated Coldwell Banker as the Most Ethical Real Estate Company in America, for each of the past 6 consecutive years. You may verify this at www.ethisphere.com.
(2) For the 21st year in a row, Coldwell Banker is again ranked the #1 residential real estate brokerage in the nation in both sales volume and number of homes sold by REAL Trends 500. Check out https://www.realtrends.com/top-10-real-trends-500-volume-2018 to see the full report.
(3) It is no accident that Coldwell Banker has consistently out performed every other Real Estate Company in America for the past 21 straight years. People love to root for the “little guy” and if that’s what you like, more power to you. But if you’re really serious about selling your home or looking for another one, it might be a good idea to consider a partnership with the one company which has both the very best reputation and the very best sales record.
(1) GUARANTEED SALE OF YOUR HOME AT 100% OF APPRAISED VALUE: Because we have sold more homes than any other company every year for the past 21 years, I can promise that if your home sells for anything less than its full appraised value as measured by the Lender’s appraisal, I will compensate you by reducing my commission dollar for dollar for whatever shortfall there might be.
(2) FREE 1 YEAR HOME WARRANTY FOR YOUR BUYER: This is a huge selling point because your buyer knows that all major components of all home systems and appliances in the home he is buying are fully insured for a period of one year after the sale.
(3) FREE HOME WARRANTY FOR YOU: This will fully protect you until close of escrow from any unforeseen or surprise expenses while your home is in the process of being sold.
(4) PROFESSIONAL MAGAZINE QUALITY PHOTOGRAPHY: Photos and videos of both the interior and exterior of your home will be taken and used to create large tri-fold brochures for mailing campaigns and used for the internet, newspaper ads and TV slots.
(5) MAGAZINE EXPOSURE: Your home will have a full page color ad in View magazine, the monthly real estate color supplement included with the San Diego Union. View is the largest circulation real estate magazine in Southern California and is distributed in China.
(6) TELEVISION EXPOSURE: The photos and videos of your home will be used to create a professional 40 second segment on our Sunday morning TV show.
(7) MAXIMUM INTERNET EXPOSURE: Your home will be exposed to 900+ real estate websites and exclusively promoted on Zillow, Trulia, Realtor.com, Yahoo Real Estate and Homes.com. Your home will be promoted by links on Facebook, Google+ and Twitter.
(8) CUSTOM WEBSITE: Your home will have its own website with photos and a detailed description. Plus, the URL will be your own street address: www.9575jacksondr.com.
(9) OPEN HOUSES: Our Open Houses always include color newspaper ads and flyers spread throughout the area. We also host special “preview” showings for your neighbors.
(10) EXPERIENCED PARTNER TO GUIDE YOU DURING THE SALE PROCESS: I have 37 years of experience, personally owning and operating well over 1000 apartments, from duplexes up to a 340 unit complex. I have negotiated the purchase and sale of single family homes, commercial buildings and a major San Diego hotel for $22.5 million.
Combining the knowledge of an experienced Real Estate Broker with the trust and reliability of America’s largest and most ethical Real Estate Company, assures your confidence in the success of both a personal and professional relationship. I look forward to working with you. Please visit my website at www.jimmoranbrokerage.com.