From the Broker
Happy August! Let’s discuss Marketing and the Brokerage’s role!
We’ve seen this time and time again as typically all businesses go in cycles. This happens to be an Up Cycle for real estate, and it should be. I recently read a National report that said June sales were the best since 2006, yet prices are 30% below where they would normally be, based on standard appreciation. This holds true for our Bay area. We all have to remember that Real Estate is local and we can’t apply National statistics to local markets - but in this case it’s spot on. Tampa Bay is simply a great value when compared to other markets around the Country.
It’s odd, but when business is down Sellers don’t argue about commission rates because they want all agents working to sell their property. However, and this is the odd part, when business is up Sellers want to pay less commission. This doesn’t make sense. Doesn’t a Seller still want all agents working to sell their property? Let’s take a hint from the New Home Builders. These professional home sellers don’t only retain agents’ selling commissions, in most cases they pay well above market rates.
While I realize this may sound self-serving for a Broker to say, the fact is, Brokers market properties for our clients utilizing all the resources available from our Brands (if we have one) and our MLS. We’re proud to represent our CENTURY 21 brand and we’re proud to be REALTORS. Whether the market is up or down, Sellers are always competing with other properties. The Seller’s agent is fighting a battle to position the Seller’s property in the best possible light based on the competing properties in the market. To be in the best possible light includes attractive pricing and attractive compensation for the other agent to incent them to bring a buyer. When a Seller sends an agent into battle, shouldn’t they be armed with the proper ammunition?
If two similar homes are for sale and one is offering a 2% selling commission and one is offering a 3% selling commission, which one would you be more inclined to show if you were an agent? Think about it. Real Estate agents are paid straight commission. Let’s say we’re talking about a $300,000 home. That could mean a (1%) $3,000 savings to the Seller but that results in 33% less compensation to the Real Estate Agent. If the property stays on the market an extra month or two, all savings disappear.
What most Sellers may not realize is that time, money and frustration are spent each month a property remains on the market. Doesn’t it make more sense to competitively compensate agents in order to achieve a sale in the fastest possible time and to have the property exposed to the greatest number of buyers in order to save time, money and frustration?
Of course, everybody wants to save a buck, however I’d like to remind you of an old saying: “Don’t cut off your nose to spite you face”. Potentially saving 1% may end up costing you time, money and frustration. I’ve also found that the agents that aren’t strong enough on these points with the Sellers often aren’t strong enough to defend the property and the price that the seller is asking, which too often results in a sales price that’s even lower due to a weak agent being sent into battle.
Please, give the agent who sent you this newsletter a call if you or someone you know is thinking about taking advantage of this rising real estate market.
There’s an old saying … You can have everything you want in life when you help enough other people get what they want. We’d be honored to help you with your Real Estate needs this year and well into the future. We’re skilled at helping you make informed decisions. To learn more about what CENTURY 21 Beggins Enterprises offers Buyers, Sellers and Agents, watch our new videos at www.c21be3.com.
Until next time, may you have fair weather and following seas!
Craig J. Beggins
President, CENTURY 21 Beggins Enterprises