Pros & Cons of Working with a Flat Fee Realtor
Are you in the market to sell your home but are unsure whether you should work with an agent or try to sell it on your own? If so, you’re not alone…While you most certainly have the autonomy to decide to attempt an FSBO, or ‘For Sale by Owner’, you also have the opportunity to work with a Flat Fee Realtor or hire an agent. The choice is ultimately yours to make.With that said, neither option is perfect, each coming with its own host of advantages and disadvantages. For starters, and as you can likely imagine, trying to sell a home on your own with little to no experience can be a hassle. Not only does it require A LOT of work, but it places 100% of the responsibility on you and you only to follow all guidelines, rules, and regulations of the real estate industry. Similarly, deciding to work with a flat fee brokerage doesn’t come without its disadvantages. While it’s certainly cost-efficient, the value of service may not be up to standard to what you’d expect from a paid broker. In contrast, working with a full-time real estate agent can become quite costly, though it does happen to be the most comprehensive option of the three. Nevertheless, in this article, we’ll be doing a deep dive into the pros and cons of working with a flat fee realtor so that you can determine whether or not that type of service is for you. Selling a home can be complicated, so it’s important to do your due diligence before deciding what approach to choose. This article is aimed at guiding you through that decision-making process.
What is a Flat Fee MLS Listing?
Before we define what a Flat Fee MLS is we must first define MLS for those unaware. Simply put, an MLS, or Multiple Listing Service, is a database used by real estate professionals to connect those looking to sell a home with buyers interested in buying a home.A Flat Fee MLS, then, is a service that a seller pays for in order to list their home on the MLS, at a flat rate, of course. In other words, it’s a common agreement or transaction made in the real estate industry between a seller and a real estate broker to place their property on the MLS.You may now be wondering what the difference between working with a real estate agent and a flat fee broker is…
Primary Differences Between Flat Fee & Full-Service Brokerages
While there is an abundance of distinct differences between flat fee and full-service real estate brokerages, there are two primary distinctions that truly set them apart from one another. For simplicity’s sake, we’ll only be touching on the two…First, the method of payment. When working with a real estate agent, the transaction is typically commission-based. When working with a flat fee broker, however, the transaction comprises one flat rate.Second, the service provided. While a full-time, full-service real estate agent markets and sells the home while also placing your property on the MLS, a flat fee broker simply lists your home on the MLS and that’s it. As you can imagine, the former is much more costly than the latter. The next question you might be asking yourself is the most obvious “what service is better?”The answer? Not so obvious. In other words, it largely depends on your budget, real estate experience, preferences, goals, and objectives. While a full-service brokerage may be better suited for some, there is a time and place for a flat fee MLS service as well. In order to quantify these situations and circumstances, let’s now dive deeper into the pros & cons, advantages & disadvantages of flat fee real estate services.
Pros & Cons of Flat Fee Real Estate
The primary reason for someone to use a flat fee MLS service is, as discussed, to list their home on the MLS database. You see, those who sell FSBO typically tend to run into one common problem; not enough eyes on their property’s listing. A flat fee MLS service solves this problem! OK, great. So what are the disadvantages of that? The property is now on the MLS, what’s so disadvantageous about that?While listing your home on the MLS is all but necessary when trying to sell it, without an agent who markets and advertises your MLS listing, it’s simply a small fish in a big pond that’s likely to get overlooked.Nevertheless, having your home on the MLS is still advantageous, especially in the digital age that we live in. In short, most potential buyers nowadays browse online the most popular real estate websites before involving a Realtor. If you’re lucky, your listing might be the one that catches a buyer’s eye! This, however, is obviously not guaranteed…Let’s now take a closer look at the pros and cons of flat fee MLS.
Pros of Flat Fee
If you’ve committed to selling your home independently, using a flat fee MLS service is likely the most beneficial thing you could do. Why? Because it allows for more potential buyers to view your property. Below are the most talked-about pros of flat fee real estate:• It is much cheaper than most other real estate services• Allows for greater control during the sale of YOUR property
Cons of Flat Fee
While flat fee MLS services are certainly beneficial for those choosing to sell FSBO, it doesn’t come without their disadvantages. Below are the most talked-about cons of flat fee real estate:
• You aren’t given the same level of quality service as traditional brokers• Has a reputation for lower selling prices • Doesn’t guarantee a sale; can be difficult or dragged out• Requires a lot of effort and due diligence on your behalf
Without the help of an experienced and knowledgeable real estate agent, it’s up to you to determine a price, negotiate the price, prepare your home for marketing photography and viewings, write the listing, handle all inquiries, and ensure that all documentation is in order. These are the many reasons why sellers opt NOT to move forward with FSBO and instead hire a real estate agent, or at the very least, a hybrid real estate brokerage.
What is a Hybrid Real Estate Brokerage?
As discussed throughout this article, we’ve taken aim at comparing flat fee MLS services to full-service real estate brokerages. As you’ve likely been able to recognize, there’s a major gap between what the two offer.This is arguably the reason so many independent sellers have trouble deciding what service to use, ultimately deciding to tough it out FSBO-style. Luckily, there’s a third option; a hybrid model, if you will…While every hybrid real estate brokerage differentiates itself in its own unique way, they’re largely defined by a few standard similarities. First, they replace commission-based charges with flat fees. Second, while they do offer their services for a flat fee, they aren’t flat fee MLS brokerages. Instead, they offer additional a la carte services to compete more comprehensively with full-service real estate brokerages. In short, consider the hybrid model the perfect blend between discount brokerages and full-service real estate brokerages; an affordable approach to comprehensive real estate services, if you will.We here at Flat Fee Florida Realty are just that; a Hybrid Real Estate Brokerage passionate about providing our clients with affordable and reliable services that they wouldn’t otherwise have the opportunity to receive. If you’re in the market for a flat fee realtor but wouldn’t mind additional perks, we’re the choice for you!