Las Vegas, Nevada -- Years ago, Penn and Teller shocked the magic world by doing the unthinkable. They created a new type of show which exposed magicians most closely guarded secrets. While many in the magic community frowned upon them, their popularity quickly grew. It became evident that audiences not only liked watching magicians, but enjoyed learning the secrets behind how their tricks were executed as well.
The magic industry isn’t the only business surrounded by secrets. Many companies use secrets or “tricks” to increase sales and hopefully get your attention. Real Estate is no exception. What is the definition of a Real Estate trick? A trick could be defined as a “sales gimmick” or marketing tactic which may be perceived by some as misleading. Here are some tricks used by several Real Estate Brokers, designed to get your attention:
DISCOUNTED REAL ESTATE FEES:
Real estate fees are negotiable. They always have been, and always will be. While there’s no set commission or standard fee, it has been common practice for Brokers to charge Sellers a 6% fee. This fee is typically divided equally (fifty/fifty) between the agent hired by the Seller to “List” the home (LISTING AGENT) and the agent who brings the Buyer. (BUYERS AGENT)
Listing agents MUST disclose in the Multiple Listing Service (MLS) how much commission is being paid to the Buyer’s agent. The amount of commission offered is something almost every Real Estate agent checks, since this is how they get paid. The higher the commission offered, the more incentive there is for agents to show your home to Buyers.
Recently, some Real Estate Brokers have been advertising discounted fees for their services. An example of this is a marketing campaign that claims to, “Sell Your Home for 1%.” This is a powerful claim because everyone wants to save money. The problem is as follows: If you list your home for 1%, how much commission will be offered to the Buyer’s agent in the Multiple Listing Service? Does this number represent only the fee paid to the Listing Agent? In reality, are you listing your home for “One Percent” PLUS a three percent commission for the Buyer’s agent? Are there other fees involved such as transaction fees, escrow and title fees, etc.? Are extra fees charged if you want your home advertised on the internet or want a virtual tour, etc.? Once you read the small print and break down the actual fees, you will soon discover that selling your home for ONE PERCENT isn’t a realistic scenario. There are many other fees involved when selling your home.
Here’s another point to consider. Some agents may agree to reduce their commission, making it look like they’re saving you money, however, this isn’t necessarily true. For example, let’s say you interview three agents. All of them seem experienced; however, two of the agents are charging a 6% commission. The third agent agrees to reduce their commission to 5%...so you hire them. Is this agent planning on keeping a full 3% commission for themselves, and offering a 2% commission in the MLS for Buyers agents?
If you offer a commission less than 3% in the Multiple Listing Service, (MLS), will Brokers be “less motivated” to show your home? Real Estate agents are obligated (per their license) to show Buyers any home they wish to see (regardless of the amount of commission offered) but does this guarantee agents will “go out of their way” to sell your home? If similar homes in your area are offering a higher commission, will agents try harder to persuade Buyers to place offers on those homes? When you list your home, your goal should be to expose it to the largest pool of potential Buyers. In order to do this, your marketing plan must include both Buyers and agents. When you reduce the commission paid to agents, are you creating a scenario where every agent in town might avoid showing your home? Imagine walking into a restaurant and telling the waiter, “I’m looking to give you a reduced tip.” What kind of service do you think you will get?
While many Real Estate agents run their business with integrity, others do not. It is our opinion that any business relationship should be based on trust and honesty. Agents should be upfront regarding fees from day one. If an agent is misleading with their advertising, will they also mislead you in other aspects of the transaction? (i.e. purchase agreements, closing costs, lender fees, etc.)
THE “MYTH” OF OPEN HOUSES:
“Open Houses” were a great way to sell homes back in the 1980’s. There was no internet. If a Buyer wanted to look at homes for sale, they had limited options. They were either at the mercy of their agent, or they could drive around random neighborhoods trying to find “For Sale Signs” or Open Houses. Today, everything has changed. Buyers are searching online for homes from on their computers, tablets and smart phones. In fact, the National Association of Realtors states that over 90% of homebuyers begin their search online. If the majority of Buyers are online, why do some agents continue to offer Open Houses as part of their marketing strategy? The answer is simple. Many agents have failed to keep up with the times. They are uncomfortable with technology and cling to pre-internet sales methods. Additionally, many agents use Open Houses as an opportunity to advertise their services to your neighbors. Maybe they need to sell too? In short, they are more concerned with getting new clients than selling YOUR home. It is highly unlikely your home will be sold to a neighbor, or some random person who happens to be driving by. You probably have better odds going to a Casino and winning Megabucks then selling your home at an Open House.
Some people see the same Open House signs week after week, and assume the agent whose name is on the sign sells lots of houses. In reality, the opposite could be true. Many new agents, with little or no business, offer to do Open Houses for successful agents. You rarely see the agent who listed a home doing an Open House. (They know Open Houses don’t work) Instead, they allow new agents to set up the Open House signs and balloons. New agents agree to do this, because it provides them with the opportunity to meet with your neighbors, and get some new clients. It has little to do with getting your home sold.
When selling your home, you need honest representation. Agents should place your needs before their own. Don’t be fooled by tricks or gimmicks. Hard work and experience gets homes sold. As with any business, you typically “get what you pay for.” Real Estate is no exception. Additionally, the importance of online marketing cannot be overlooked. Using an agent who relies on Open Houses to sell homes is like hiring an accountant who uses a “slide rule” to do your taxes or a secretary who uses a typewriter.
The Myers Team with Simply Vegas Real Estate specializes in seller representation. They are Las Vegas Top Real Estate Agents.
Contact The Myers Team at: 702-677-4343
For Traditional Sales, CLICK: http://www.LasVegasList4Less.com
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