One popular question we have received over the past few years is "How do current real estate market conditions impact Flat Fee Listings?"
My answer is simple: Flat Fee MLS is healthy, and awareness of flat fee MLS as a home selling option continues to steadily grow.
This is based on a fact that hasn't changed in any market: it is the MLS that connects the buyers to the sellers. Good market or bad market, the MLS connects the buyer and seller more than all the other marketing methods combined. We regularly hear from sellers that last time they paid a huge commission to a traditional agent, and it was the MLS that actually brought us the buyer. Whether the agent seemingly worked hard or was hardly working on the listing, what mattered was that the property was in the MLS.
Some people who ask this question expect me to say that flat fee listings are hurting because it is more difficult to sell a home than in the boom years of the market. A seller or two have told me that they don't want to list as a flat fee seller because they feel that they need an agent who will strong arm a buyer into buying the property. I always ask, have you ever been “strong armed” into buying a home? No one has ever told me they bought a home because of an aggressive agent.
Some people mistakenly inflate how influential a buyer’s agent is in the selection of the home. They almost view it as the buyer agent tells a buyer to buy a home, and the buyer buys it. This simply doesn’t happen.
Do buyer agents influence which home their buyers’ purchase? In general, yes, but in a very small way. There is the occasional family member or relocating buyer with a longtime relationship with their agent, but that is the exception rather than the rule. When I first worked in real estate, all I did was work with buyers. I’ve seen hundreds of buyers go through the entire home finding and buying process. As you would expect, buying a home is the largest transaction of our lives, and people put lots of thought into their decision. Can an agent tip the balance? Not often. The typical home buyer has to think through a number of needs and wants to make sure the property is right for them—neighborhood, size, price, condition, schools, commuting, and that’s just the logical part of the decision. What their agent’s opinion on the house is, well, they will often listen, but it isn’t even in the top ten factors that make the decision.
So Flat Fee MLS Brokers aren’t going away, as some traditional agents might wishfully think.
Another factor to consider is that more sellers need an affordable option to sell. When home prices were increasing steadily, many people didn’t even think about spending 6% on the transaction. Now that an owner’s equity is less, and in some cases, non-existent, they look to a flat fee listing as the only option for selling. We have seen an uptick in sellers being referred to us by traditional agents, because the seller can’t afford the traditional fee.
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