Yes, listing flat fee in the MLS does work well in Orlando, Miami, Tampa, Jacksonville and other Florida cities but there are nuances a seller should be aware of to maximize the showings and marketing of their MLS listing. I discuss 4 top factors below that will help make your For Sale By Owner with MLS listing work better for you. Additionally, you may like to take a look at ADDvantage® of Florida's flat fee MLS sales statistics for the past 12 months. ADDvantage® is a Florida based discount real estate brokerage offering flat fee listings in the MLS.
5 major factors that will determine whether you find success with a flat fee MLS listing:
- The flat rate MLS service that you choose
- The price that you list in the MLS
- The commission that you offer buyer's agents
- The quality of marketing
- The degree at which your listing blends in with other listings in the MLS
•1) The company: The flat fee listing service that you choose to list your property in the MLS with might be the single greatest factor in your success, assuming you are priced right. There are two critical areas: (a) Buyer leads: Make sure the flat fee company is not taking "your" buyer leads from Realtor.com, Homes.com and other sources. Some flat fee services in Florida use these buyer leads as they see fit. Read their listing agreement carefully. This can hurt your ability to sell. Without buyer leads, it would be impossible for you to find an unrepresented buyer. Please read my blog Is a $169 flat fee MLS listing a safe way to list a Florida home? (b) Phone support: This critical factor relates to showings. The flat fee seller must depend on the listing broker (flat fee company) to forward all email and phone calls received from buyers and Realtors®. Many Florida flat fee MLS services don't reliably pick up their phone during business hours and never on weekends. Note: ADDvantage® may be over-the-top with our 8:00-8:00 7 days a week live phone support but it does get results. Our flat fee sellers get their messages by email in real time. The top requests made by Realtors® and buyers are: showing instructions; property information; lockbox codes; and of course, "I can't reach the seller, can you help me?"
•2) The price: Some sellers list with flat fee listing companies and don't sell, not because the service provided by the listing company was poor, but because their price was more in line with what they wanted to get as opposed to what was realistic. Since flat fee services let sellers control their own price, there is no agent to suggest price drops. Often, sellers erroneously assume that the lack of offers is due to the way they listed. They switch to a full service agent only to find that they still don't sell...until they drop the price. Conversely, many times people list with full service agents and cling to a price, then after months of not selling, attribute it to the agent and list flat fee in the MLS.
In a buyer's market, I suggest what I call the "cash test" to determine whether you are priced right. Assuming you were sitting at a table negotiating with a cash buyer, what would be the price that you would sell for, assuming no real estate commissions or closing costs are paid. Whatever that price is, multiply that price by 1.07% which will be enough to cover closing costs which are about 2% (documentary stamps on deed and title policy) and a buyer's agent commission ranging from 3-5% depending on what you are offering in the MLS as well as room for negotiating. Now, let's translate this cash test price using a real number. Let's use $200,000 as the cash price that you would accept, add in a 3% buyer's agent commission and 2% for closing costs. The math now would be: $200,000 x 1.05 or $210,000. Now add 2% for negotiations or $200,000 x 1.07 = $214,000. The reason I suggest using this formula for setting a listing price in a buyers market is because it draws more offers.
•3) The commission: I have seen two sellers over the past two years sell successfully offering a 1.5% buyer's agent commission. Their properties were extremely unique. One was a flat fee listing in Jacksonville and the other, a Miami flat fee MLS listing. In these rare cases, the buyer, not the Realtor®, is likely the driving force behind the sale. Most sellers using a discount MLS broker offer a 3% buyer's agent commission. About 38% of our sellers at ADDvantage® offer a 4% buyer's agent commission and use our Street Smart ADDvantage® Realtor to Realtor® email marketing. Our sales stats do indicate flat fee MLS sellers in Florida have more success offering a 4% buyer's agent commission. That is only logical since agents are driven by commissions. Offer more and they are more likely to make it a priority.
•4) The Marketing: Realtor.com "Showcase" offers more exposure (25 pictures) than a standard Realtor.com listing. Homes.com is a powerful real estate website that draws plenty of buyer leads. Craigslist.com generates many hits and I see this as a good value...it's free. A Miami flat fee MLS seller using ADDvantage PlusTM just landed a hot prospect for their South Beach condo using Craigslist.com. Street Smart ADDvantage® flat fee Realtor® eblast scores about a 13% click-thru rate on its 10,000 bi-weekly Realtor® eblast. Themovechannel.co.uk and Worldproperties.com spread the word in Europe but these sites are not as prolific as Homes.com or Realtor.com. Zillow.com is good in a way and bad in another. Zillow's downfall is its database of closed sale data. Their conspicuously displayed closed sale data in your neighborhood can hurt the sale in a buyer's market. A virtual tour promotes more viewings from Realtor.com (if you are "showcased") and their red spinning house logo garners additional attention as well. In today's Internet driven market, about 60% on home buyers are searching online.
•5) Blending in: There are many factors that are affecting this buyer's market. The major one is a lack of buyers or more homes for sale than buyers to buy. Under these conditions, even the best full service Realtor® with a powerful buyer base is limited by the circumstances that surround the market. One advantage that full service agents do have over flat fee MLS listings is the way listings are displayed in the MLS. This affects only Realtors®. Full service MLS listings are inputted in a category of "Exclusive Right of Sale" meaning the listing agent gets paid a commission regardless of who sells the property; the owner, transfer of title, death...it doesn't matter. Flat fee MLS listings are listed in the MLS as "Exclusive Agency" meaning the seller has the right to sell themselves without paying a commission to the listing agent. This little discrepancy is used by some unethical Realtors® to identify a flat fee listing and possibly boycott it. While highly illegal (anti-trust), it does happen. ADDvantage® has solved this dilemma with our new ADDvantage PlusTM MLS flat fee plan that mimics the full-service listing in every way including the Exclusive Right of Sale Listing Agreement. And, it allows the seller to sell "By Owner" and pay only $500 at closing, rather then a large percentage commission.
ADDvantage Will List Your Property In Your Local Florida MLS Board!