The One & Only Way To SELL Your Home Yourself… & Avoid Exorbitant Real Estate Commissions By Nishika N. Jones Licensed Real Estate Broker Urban Living Realty Introduction The Multiple Listing Service (MLS®®) is the best way to sell your property. There. We said it. For anyone planning to sell a home without the assistance of a realtor, this may sound harsh. But the truth is, 90% of all houses sell specifically because of listing in the MLS®. Unless you happen to hit upon the right connection with a buyer by some stroke of luck, your home likely will not sell if it is not listed in the MLS®. In today’s volatile real estate market, the chances of selling your home based on luck alone are, well slim. For homeowners who want to sell without a realtor, this presents a problem, since access to the MLS® is impossible without assistance from a realtor. The question then becomes how you can sell your home on your own terms, get great exposure to thousands of realtors and potential buyers, and still access professional help if you need it? There is a way. And it’s a method that goes far beyond the inflexible method known as FSBO (For Sale By Owner.) That way is the flat fee listing, also called a flat fee MLS® listing. In this special report, we are going to learn how the flat fee MLS listing is bridging the gap between FSBO sales and traditional realtor-assisted sales to literally revolutionize the real estate world, making it possible for homeowners to sell their homes, even in a roller-coaster market, for the price they want and pocket greater profits at the same time. Of course, any discussion of this new trend must begin with an understanding of the MLS®. What is the ‘MLS®’? The MLS® (Multiple Listing Service) is a database that lists every type of real estate property, from single homes and commercial properties to townhomes, condos, acreage and rentals. Your property’s listing in the MLS® ensures that all realtors can find your home and show your home to clients who may be seeking exactly what you have to offer. Of course, realtors are not the only ones with access to the MLS®. Buyers, too, can search for properties that meet their criteria, and statistics prove that properties listed in the MLS® sell faster and sell for more money than traditional FSBO-listed properties. Obviously then, the MLS® is a powerful database. About 85% of all homebuyers using a realtor (who in turn uses the MLS®) will find the perfect property. Interestingly, people often think the MLS® is one big national property database. Actually more than one thousand individual MLS® databases exist across the country, including one for each of the fifty United States. This means a realtor in Kansas cannot see listings in the MLS® for New York City. Obviously, ensuring a listing in the correct geographical MLS® is crucial to the exposure and sale of your property. Additionally, numerous national websites aggregate listings from these many MLS® databases, displaying some information, such as agent commissions and owner contact information, for the benefit of other agents. One of those websites is www.Realtor.com. Your listing in the MLS® will also spark additional listings on other websites, including but not limited to: • Trulia • Google • MSN • Yahoo • AOL • Craigslist • Zillow • Hot Pads • Redfin How Your Property Gets Listed in the MLS® Only a licensed real estate broker who is a dues-paying MLS® member can list a property in the database. There are no exceptions to this rule. This is a good thing, because a lot of responsibility goes with listing a home. The broker must ensure the accuracy of the listing and keep it current whenever there is a change in price or any other factor. For example, a home listed as ‘active’ in the MLS®, but actually sold or under contract, can cause the broker to lose his MLS® membership or even pay high fines. To have your property listed in the MLS®, you must sign a contract with a realtor and agreed to pay the sales commission of about 6%. How do we know? Because no realtor is going to list your property in the MLS® unless a commission is involved. Don’t want to pay a commission? You are out of luck. MLS® rules state a commission must be listed at the outset for every property entered into the MLS®, so other agents will know approximately what their payday will be if their client becomes the buyer, since buyer agents are typically paid 2.5%-3% of the final sale price of the home. Currently, no MLS® System exists solely for FSBO properties. Since the best way to get the greatest exposure for your property is via MLS®, and since only a licensed realtor can place your property listing in the MLS®, it stands to reason that, one way or another, you will have to use the services of a realtor and the Multiple Listing Service to sell your home. So here is the million dollar question: If you have decided to sell your home yourself and you want the greatest amount of exposure possible, how exactly are you going to get your home listed in the MLS®? Before we answer this question, let’s learn a little more about flat fee MLS listings. What is a Flat Fee MLS Listing? The flat fee listing, or flat fee MLS® listing, refers to the real estate practice of advertising a property in the MLS® for a set fee, as opposed to paying the traditional 6% commission based on the selling price of the property. When arranging a flat fee MLS listing, the real estate broker and property owner work together—the broker lists the property in the MLS® and the seller pays the broker a flat fee of $500-$700. Why would a property owner agree to a flat fee MLS listing? Properties listed in the MLS® under the flat fee MLS listing arrangement require the seller to offer a commission, known as the "Buyer's Agent Commission". Generally, this commission equals 2.5% to 3% of the property’s selling price as paid at closing. If the home is sold because of the efforts of the homeowner, no buyer’s agent commission is paid. If the home is sold because of the efforts of a realtor, i.e., the realtor shows your home to a client and the client buys the home, then the Buyer’s Agent commission must be paid at closing. Still, when you consider that the savings can be as much as 3% of the selling price, this is a significant plus for the homeowner’s bottom line, potentially putting thousands of dollars in his or her pocket. A Buyer’s Agent is a real estate agent who represents the buyer, not the seller. Typically, when you contract with a real estate agent to sell your home, the agent works on your behalf. This agent is the ‘Seller’s Agent’. Of course, other agents may bring potential buyers to your home. If you are paying a 6% commission to your broker and the home is eventually sold by a second agent, the two agents split the commission so that they both make money from the transaction. The Buyer’s Agent, however, works with buyers only is and not obligated to the seller in any way. Why would a broker agree to this type of arrangement? To increase their volume of business and gain exposure for their real estate firm. After all, a listing is a listing, and the real estate market is highly competitive. The broker can list your property in the MLS®, then sit back and wait for a buyer’s agent to sell the home and pocket a 6% commission. Not bad for a few hours’ work. But why would a homeowner want to pay that full service commission when the same services are available with a flat fee MLS listing for only a few hundred dollars? With flat fee MLS listing, the MLS® becomes a property-selling device, a marketing tool for homeowners, without the downside of purchasing an expensive full service package from a realtor, which typically includes other forms of advertising, open houses, marketing to other agents, and other advertising strategies commonly used by realtors. Now that we have a better understanding of the MLS® and flat fee MLS listings, let’s find out more about how flat fee MLS listings can help you get your home sold. Can a Flat Fee MLS Listing Really Get Your Home Sold? Let’s face it these are tough times in the world of real estate. Home prices have plummeted, and interest in buying and selling in many areas has bottomed out as people become more fearful of the future. With such a bleak economy, many have determined to simply wait it out until the market turns around. But not everyone. Believe it or not, people are still selling their homes. And people are still buying. Some people must do so because of a job transfer, or perhaps family issues or financial reasons. Some people simply want to and are in a good position to move forward. Of course, in a buyer’s market, sellers may take a hit in profits upfront, but will likely recoup some of their losses on the purchase of a new home, because buying prices are somewhat deflated. It makes sense then that the more money you can save on the sale of your home, the more money you will have in your pocket for a new home purchase or for other needs, such as financing your child’s education, buying new furniture, taking a much needed vacation and so forth. Wait! What was that? More money in your pocket? That’s right. More money in your pocket is the number one reason for the recent popularity of the flat fee MLS listing. But some fear a flat fee MLS listing will prevent realtors from showing their home, because the commission structure is different. Some homeowners have even been threatened by realtors and scared into believing their home will never sell without the assistance of a realtor. Nothing could be further from the truth. Why Realtors Will Jump Over Themselves to Sell Your Flat-Fee MLS Listed Home Realtors rely on the MLS® listing as a powerful vehicle to search for and sell homes. A realtor would prefer to list your property in the MLS®, sit back and let the buyer’s agent find the right buyer for the property. This is precisely why a flat fee MLS listing is superior to a FSBO (For Sale By Owner) listing. Individuals choosing the FSBO listing method have no access to the MLS®. This means realtors will not see the home and will not promote the home to their buyers. Buyers looking on their own will not see the home either. For the most part, the only way to see the home is to drive past it accidentally. There is no commission available to realtors for showing a FSBO, because there is no contract stating the commission payable to the broker/realtor in the event of a sale. Naturally then, if you choose the FSBO method, do not expect realtors to come knocking at your door. They won’t, unless they’re knocking to see if they can convert you to a full service customer at a 6% commission. Once your home is listed in the MLS® however, realtors who regularly scan the listings will pick up on your home, and will begin promoting your home to their buyers who are looking for the features and benefits offered by your property. Buyers who are sitting at home or at work looking for the right houses on the Internet to see on the weekend, or looking for Open Houses or Virtual Tours, will also see your home. Bam! Instant exposure. So doesn’t it make sense to save the 3% listing agent’s fee and pay a flat fee for multiple listing services with full exposure to the same buyers? Now here’s the really good news: Your listing in the MLS® will look no different than any other listing, despite the fact that you are only paying the listing broker a flat fee of about $500-$700. AN IMPORTANT WARNING Before we go on, this caution is important to emphasize: Do not listen to realtors who try to scare you into believing that some real estate agents will not agree to sell your home once they learn you have chosen a flat fee MLS listing. This is completely untrue. The Buyer’s Agent does not care about the flat fee paid to the broker. The only commission they care about is the one they receive for bringing a qualified buyer to your door, and that commission is generally 2.5% to 3% of the final selling price. Some reports have surfaced stating traditional real estate brokers have unjustly punished nontraditional real estate brokers by avoiding the showing of flat fee MLS listed homes because they mistakenly believe the flat fee homeowner may be difficult to negotiate or contract with. These incidences occur less and less as the consumer demand for alternatives quickly grows, and as unethical real estate professionals get the message that strong-arming sellers can land them in a heap of trouble. Here’s the point: Your home will end up being listed in the same MLS® whether you contract with a realtor or a flat fee MLS listing broker. All you have to do now is decide whether you want to pay multiple thousands of dollars for the privilege, or no more than $700 just one time ? How To Take Your Home From ‘Cold’ to ‘SOLD!’ It is clear that homeowner demand for real estate options has increased dramatically. According to a report published by the Consumer Federation of America in December 2006, “There is considerable evidence that, over the last decade, nontraditional brokers have grown in number and in market share of sales. According to Wall Street Journal articles, from 2002 to 2005, the proportion of home sellers using traditional brokers declined from 74 percent to 70 percent. According to the consulting group RealTrends, during the same period the share of sales involving nontraditional brokers rose from two percent to 11 percent. This growth parallels the expansion of nontraditional brokers and their associations.” The report goes on to say, “CFA examined the Yellow Pages listings of real estate agents in ten cities and found that, over the past decade, there has been a large increase in advertising by nontraditional brokers. Between 1995 and 2005, discount, flat fee MLS, and For Sale by Owner business directory listings increased by 152 percent in these ten cities. In the same period, exclusive buyer agent (EBA) listings rose by 20 percent. Also during this decade, nontraditional brokers were increasingly willing to pay for prominent placement within the business pages of Yellow Pages listings. Between 1995 and 2005, the prominent and pricey display advertising for all nontraditional real estate business (exclusive buyer agents as well as discount, flat-fee, and FSBO) increased by 31 percent while the use of boxed listings increased by 73 percent.” Think about it. If more homeowners were not demanding alternative services such as the flat fee MLS listing, why would these changes be taking place? It is clear that there has never been a better time to choose flat fee MLS listing as a proven way to sell your home yourself with all the advantages of realtor-assisted selling, and none of the exorbitantly high costs. Urban Living Realty- One Step Closer to Perfection To meet this exploding demand, Baltimore, Maryland’s Urban Living Realty has taken the idea of flat fee MLS listing and enhanced the strategy further to ensure homeowners have even greater control over the sale of their property, while also accessing one or more crucial professional services right when those services are most needed. For homeowners who want to take charge of the sale, access professional services as needed, and end the transaction with cash on hand – and who doesn’t? – Urban Living Realty offers the most revolutionary solution. Urban Living Realty is a premier real estate network with the experience and know-how to get your home sold or rented quickly, at a huge savings. They assist in maximizing your property’s exposure at a fraction of the cost of listing with a traditional real estate company, offering Flat Fee MLS® Services that include these five important benefits: 1. Exposure to Buyer’s Agents, who can scan MLS® listings geographically to find homes that suit their clients 2. Maintain control of the contract negotiation process by alleviating the ‘middleman’ 3. Gain access to millions of qualified buyers and renters via listings on realtor websites, maximizing your property’s potential 4. Create greater demand for your property through exposure to a larger pool of buyers and renters 5. Optimize your price negotiations using commission savings to close the deal Spend less on advertising- One low price for the highest exposure can make all the difference in selling your home quickly The Modern Way to Sell Your Own Home Contrary to what is portrayed daily in the media, properties are actually selling and renting. According to www.Realtor.org, 5,652,000 home were sold in 2007, the fifth highest year on record. Urban Living Realty recognizes what homeowners really need. How do they know? Years of experience. Urban Living Realty is a highly innovative real estate company, often on the cutting edge of providing most-wanted services even before they become mainstream. Several years ago, the partners of Urban Living Realty saw the need to improve the way flat fee MLS listing transactions are conducted, and set in motion plans to ‘makeover’ the flat fee industry with a more ‘modern’ feel. They knew homeowners wanted more control over the sales process, but also wished for options in choosing professional services for the help they needed at specific times during the selling process. While most sell- it-yourself homeowners were left out to dry by flat fee MLS brokers who were more interested in converting the homeowner to a full service [...]... dollars to use any way you like to save for your child’s education, take a much-needed vacation, buy a new car, or buy a new home For homeowners who are knowledgeable about their market and anxious to access the power of the Internet to sell or rent their home, these statistics may be surprising: ♣ 57% say advertising via the Internet reduced the number of places they looked at ♣ 54% say they took an... continuously grows The dynamic combination of our flat fee MLS service, your home s display on the MLS®, related real estate website listings, and the power of the Internet driving the exposure and sale of your home offers you a far superior opportunity to close your real estate transaction faster and with more money in your pocket For a flat fee of only $500-$700, you will instantly increase your property’s... giving homeowners exactly what they wanted The flat fee MLS listing solution created by Urban Living Realty has been astoundingly helpful to homeowners More and more sellers are choosing flat fee MLS listing to sell their home, and Urban Living Realty believes it is safe to say things will never be the same Traditional realtors may scoff at the services Urban Living Realty offers, and no doubt they will... more and more popular in this the real estate market as more and more homeowners become aware of the power they possess to save money on their real estate transactions, control advertising and marketing costs, and command the Internet to get their home SOLD! So what are you waiting for? 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The One & Only Way To SELL Your Home Yourself & Avoid Exorbitant Real Estate Commissions By Nishika N. Jones Licensed Real Estate Broker Urban Living Realty Introduction The. of the homeowner, no buyer’s agent commission is paid. If the home is sold because of the efforts of a realtor, i.e., the realtor shows your home to a client and the client buys the home, then. can place your property listing in the MLS®, it stands to reason that, one way or another, you will have to use the services of a realtor and the Multiple Listing Service to sell your home. So