How to Keep More Money When Selling Your Home with a Flat Fee Real Estate Agent
If you're putting your Austin-area home on the market soon, you should know how to maximize your profit while minimizing extra fees and expenses. Hiring a skilled real estate agent to represent you is crucial to selling for top dollar in today's shifting market. But did you know that not all realtors charge the standard 6% commission? Enter the flat fee real estate agent.
What Is a Flat Fee Agent?
A flat fee real estate agent provides the same full service you'd expect from a conventional agent but for a fraction of the cost; rather than charging a 6% commission based on the sales price, full-service flat fee agents offer seller representation and their expertise for a low flat rate. The result? You'll keep thousands more in your pocket.
While each flat fee agent's model differs slightly, most charge significantly less than a 6% listing agent. With the median sale price of an Austin house around $518,000 as of November 2023, you'd pay a typical agent over $31,000 on a 6% commission!
And today's shifting housing market makes a reduced commission Realtor an intelligent choice.
Why Flat Fee Agents Shine in Down Markets
After years of runaway home prices, Austin real estate took a turn during the summer of 2022. Higher mortgage rates and economic uncertainty meant slower home sales and 10-20% price drops compared to 2021's peak home values, and experts project Austin-area home prices to dip slightly more in 2024 until the market stabilizes.
When home values fall, paying a 6% Realtor commission eats into your reduced equity. But with a flat fee agent, you pay a lower fee regardless of market fluctuations. This unique business model allows you to maximize profits when home prices drop or soar.
And remember - today's cooling home prices magnify the savings benefits even more! If the equity in your property is tight (if you recently purchased the home, for example), utilizing a flat fee broker can mean the difference between selling now or having to stay put for a while.
Of course, a listing agent's fee structure is only part of it. You still deserve stellar service, experienced insight, and results from your trusted listing agent.
Choosing the Right Flat Fee Agent
Experience, service, and results vary widely from one agent to the next. Before hiring your agent, make sure to:
• Vet experience level - the Austin real estate is hyper-localized, and an experienced local agent will navigate nuances more adeptly than a broker working remotely all over Texas.
• Confirm full service - a flat commission fee does not necessarily mean reduced service. A full-service real estate agent should provide you with an on-site meeting at your home, expert market analysis to help price your home, a professional home staging guide, professional photography with virtual staging, optional video marketing, a yard sign with flyers, MLS listing on the premium websites, a showing scheduler, contract negotiation, and closing paperwork review, and most importantly - direct phone support 7-days a week.
• Read the agent's reviews - what do past clients have to say? Is the broker polished, professional, and detail-oriented? Did they make the home-selling process easy?
The takeaway?
Opting for a lower commission fee doesn't mean you have to compromise on service.
Is a Flat Fee Agent Right for You?
If your home or residential lot is likely to sell for $200K or higher, a flat fee agent will save you thousands in commission fees. Just crunch the numbers - a $400,000 home with a 6% commission vs. selling with a flat fee broker such as Jason D. White nets over $6,000 more in your pocket.
Most full-service flat fee agents can provide complete representation by advertising your property (including on the MLS), coordinating agent showings, vetting buyer inquiries, handling contract and repair negotiations, and assisting with the closing paperwork. But do your due diligence by confirming the level of service upfront.
Full-service Flat Fee Listing Agent vs. Flat Fee MLS Listing
Most flat-fee full-service listing agents charge $5k+ for their services. Meanwhile, a flat fee MLS listing can be purchased for a few hundred dollars.
What is the difference, and what's the best fit for you?
An easy way to think of a flat fee MLS listing is similar to selling something back in the day by buying an ad in the newspaper's classifieds section. (You write the ad, supply the images, and you take the calls from buyers) On the other hand, a full-service flat fee listing agent is like hiring a 6% real estate agent - but for less. Make sense?
Quick Check - MLS Only Listing
Here is a quick way to gauge if purchasing an MLS listing and skipping full-service broker representation is right for you:
Can you say yes to any of these?
• Motivated sellers who have sold several properties before.
• Sellers who are familiar with state and federal real estate laws.
• Sellers who are very hands-on with the process do not need a broker's guidance.
• Sellers who have researched values and are confident in the asking price without leaving profits on the table.
• Sellers who know how to stage a home to sell and have trusted contractors to complete makeready repairs.
• Sellers who can write compelling advertising copy and have a skilled photographer to hire.
• Sellers who are comfortable and available to take calls and emails from buyers and can meet at the property to show during the week and on the weekend.
• Sellers who are familiar with real estate contracts and are comfortable with negotiations while retaining as much profit as possible, all while keeping the deal together. Note: Sellers can hire a real estate attorney to assist them, but keep the cost of legal fees in mind.
If you answered yes to most of the key points above, purchasing an MLS listing for a few hundred dollars is worth considering.
Ready to shop for a Flat-fee Real estate agent?
If a flat fee real estate agent looks like a better fit after reading this guide, that's fantastic. The Austin area boasts several brokerages offering this cost-effective model.
Research 2-3 listing agents, compare service offerings, and read their reviews. You can do this!
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