Statistical Comparison of Limited Service Listing vs. Full Service Listing

By
Real Estate Agent with Sand Dollar Realty Group, Inc. BK627826

I've been wanting to do a statistical analysis of limited service listings compared to full-service listings for a while now.  I wanted to compare the 2 for listed vs. sold ratio, days on market, and sold price.  So today I did a very "unscientific" analysis by performing searches in our local MLS.

I did a search of 6 Florida counties surrounding Orlando - Lake, Orange, Osceola, Polk, Seminole, and W. Volusia Counties for the last 6 months (6/1/07 - 12/1/07). 

Honestly, the results shocked me.  I was expecting that with a full service listing you have a full-time Realtor trying to market and negotiate the listing, so the numbers would be somewhat better than having an owner handling basically everything except the MLS input.  These are the numbers I came back with after doing MLS searches and a few calculations.

Listing vs. Sold ratio:

Limited Service Listing:  559 solds out of 2,930 total listings which = 19.08% chance that a listing will sell.

Full Service Listing: 12,606 solds out of 97,054 total listings which = 12.99% chance that a listing will sell.

Actual Days on Market (ADOM):  This is a median number, I could not easily compute an average number.  It is the number of days from when a property was listed until it went sale pending.  I only used properties that sold to compute this.

Limited: 57 days on market

Full: 87 days on market

Sold Price: This is a median number also.  I only used properties under $400,000 because the computer was giving me a hard time with the search because of the 12K+ solds for the entire 6 counties.

Limited: $267,500

Full: $213,800

Again, I am still scratching my head over these numbers.  Maybe with only 2,930 limited service listings versus 97,054 full service listings that the small amount of limited service listings may skew its numbers in the better direction.  Maybe the higher chance of selling, in less days, at a better price has to do with the fact that the owner only has 1 house to sell (and can therefore focus hard to sell it) while the listing agent may have a dozen.  Maybe the higher average price is because people that choose a limited service listing are better educated or have more homeselling experience than people that choose a full service listing (and therefore own a higher priced house).  I don't know for sure, but those numbers do reveal something that few full service brokers will ever disclose to anyone.

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(Copyright © 2007. Sand Dollar Realty Group, Inc. All rights reserved.)

Rob Arnold, ABR, CPL, GRI, Managing real estate broker, Licensed mortgage broker, Notary Public

407-389-7318 www.SDRhouses.com/

Your full service and investor friendly Realtor in Orlando. Learn to invest in Central Florida real estate and Orlando real estate. Investor mentoring and counseling available. I also provide flat fee MLS listings, For Sale By Owner, and menu-based services in most parts of Central and South Florida.

We buy houses cash, sell properties, and list properties in Central Florida including Orlando, Winter Park, Maitland, College Park, Ocoee, Winter Garden, Apopka, Pine Hills, Altamonte Springs, Casselberry, Longwood, Winter Springs, Oviedo, Lake Mary, Sanford, Deltona, Debary, Deland, Mount Dora, Eustis, Clermont, Kissimmee, Saint Cloud, Davenport, Winter Haven, and more. www.WeBuyHousesFlorida.com/ 

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Rainmaker
1,013,271
Rob Arnold
Sand Dollar Realty Group, Inc. - Altamonte Springs, FL
Metro Orlando Full Service - Investor Friendly & F

Generally speaking it is a listing where the listing agent does not perform the typical full services that most Realtors do (i.e. marketing, assistance with pricing and staging, negotiating, paperwork, transaction coordination, closing coordination, etc.).  Instead they input it in the MLS, provide a sign, and maybe a few other functions, and let the owner take care of everything else. 

Our MLS allows you to categorize a listing as Exclusive Right to Sell, Exclusive Agency, or Limited Service.  The big bulk of them are Exclusive Right to Sell listings.

Dec 01, 2007 10:19 AM #2
Rainmaker
575,553
Terry & Bonnie Westbrook
Westbrook Realty Broker-Owner - Grand Rapids, MI
Westbrook Realty - Grand Rapids Forest Hills MI Re
We ares in the middle of the legislature trying to pass a bill requiring us to disclose what we will do for our fee. If nothing else we may be able to educate the public on the difference. I guess they think we all are the same and if they can get someone to do it for less they go for it. Thanks for the info.
Dec 01, 2007 10:38 AM #3
Rainmaker
1,013,271
Rob Arnold
Sand Dollar Realty Group, Inc. - Altamonte Springs, FL
Metro Orlando Full Service - Investor Friendly & F

Terry - Hopefully that bill won't pass.  We do not need to be over-regulated.  A little regulation is probably OK, but legislators tend to get carried away.

Dec 01, 2007 10:47 AM #4
Rainer
103,259
Armando Rodriguez
QUEST REALTY SERVICES - Orlando, FL
Orlando Homes 4 Sale, Real Estate Broker-GRI

Very interesting indeed. I'm going to save those figures or run them myself.

They would be useful for listing presentations and to counteract what is generally said about limited services listings.

Thanks for posting the info!

Dec 02, 2007 01:23 PM #5
Rainmaker
1,013,271
Rob Arnold
Sand Dollar Realty Group, Inc. - Altamonte Springs, FL
Metro Orlando Full Service - Investor Friendly & F

Armando -

When I was doing the research, I was expecting to be able to post that there was only maybe a 5-10% better chance that the listing would sell using a full service Realtor so why spend the extra money.  I still do not understand why the numbers are showing that full service Realtors in Central Florida are selling a lower percentage than limited service.  That is why I said it is an "unscientific" analysis - there may be other factors that I am unaware of for why these numbers come out this way.

If you read the book Freakonomics, Chapter 2 is titled "How is the Ku Klux Klan Like a Group of Real-Estate Agents?"  That title is quite dramatic and a little insulting to real estate agents.  It discusses how both groups control numbers and statistics.  It states how an extra $10,000 in sales price = $10,000 in additional profit to an owner, but only an extra $150 in commission for the listing agent (10K * 6% then split 4 ways between 2 brokers and 2 agents).  I can't give a good explanation without rambling, but it is a very interesting read.

Dec 03, 2007 01:41 AM #6
Rainer
27,362
Bo Bromhal
BHHS York Simpson Underwood - Raleigh, NC
Triangle Native, 2 decades of experience

I just finally picked up Freakonomics myself yesterday - at the local library for free of course.  Interesting stuff.

 

I should think if you wanted to invest the time, you could get your arms around those figures more precisely.  In our Triangle MLS, for example, we're limited to 99 results - so sometimes it takes longer to get info processed. Of course, we also have a "Statistics" section which will break all this info down for us in larger group terms.

Feb 20, 2008 07:22 AM #7
Rainmaker
1,013,271
Rob Arnold
Sand Dollar Realty Group, Inc. - Altamonte Springs, FL
Metro Orlando Full Service - Investor Friendly & F
Bo - Freakonomics is quite an interesting book.  It covers a lot of interesting topics.
Feb 20, 2008 11:38 AM #8
Rainmaker
111,540
William "Bill" and Karen Farragher
EXIT Blue Water Realty, Matawan, NJ 07747 - Matawan, NJ
SFR

Hi Rob, did you take into consideration that there are probably a ton of pre-forclosure and reo properties in the full service catagory. Just a thought. I am not from the area and therefor do not know the numbers.

Sincerely,

Bill

Aug 18, 2008 02:34 PM #9
Rainmaker
1,013,271
Rob Arnold
Sand Dollar Realty Group, Inc. - Altamonte Springs, FL
Metro Orlando Full Service - Investor Friendly & F

Bill - My research was done back in December of last year.  It included all listings regardless of their foreclosure status.

Aug 19, 2008 02:46 AM #10
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Rainmaker
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Rob Arnold

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