Saving Money By Reducing Your Real Estate Broker Commission

Six percent. No matter how much money and sweat equity you’ve put into your home, as soon as you sell it you have to kiss six percent of the sale price goodbye to pay the real estate brokers’ commission. If you’re underwater on your property, you can expect to bring enough money to the closing to make up the difference between the sale price and your mortgage amount, plus all of the taxes and fees, AND six percent to pay the brokers. Doesn’t seem fair, does it? With an increase in the availability of real estate data and tools online, web savvy homeowners who are willing to do some of the work themselves are looking at ways to save money by reducing the commission they pay.

According to 2008 data from the California Association of Realtors, sellers indicated that on a scale of one to five (five being most satisfied), their level of satisfaction with “value received for what you paid your real estate agent” was only 2.6. This indicates a sizable price/value discrepancy. So if sellers feel that real estate agents aren’t providing a valuable service, why do they continue to pay the 6% commission? In this same study, 45% of homeowners said they were inclined to try offering their property For Sale By Owner, however, only 9% actually followed through. Why the resistance? Sellers cited a belief that agents control most of the buyers, and that agents can get a higher sale price as reasons for choosing to go with a broker as opposed to selling by owner. Other barriers to selling by owner include pricing a property wrong and lack of listing exposure.

These barriers, both perceived and real, are being overcome thanks to new technology which allows property owners who are willing to be involved in the process of selling their home to save money by working with a low commission broker. In the case of RealDirect, we ensure your listing has maximum exposure to buyers and brokers through inclusion in the REBNY database (the primary source of listing data for NYC real estate agents) and advertising on NYTimes.com as well as Streeteasy. Our platform enables ease of sharing through integrated social media widgets and Craigslist.com. By using our RealPrice system, sellers can be sure they’re listing their properties at a competitive price-point without leaving money on the table. And our results show that listing your home with RealDirect is every bit as effective as working with a full-service brokerage. But a lot less expensive.

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