Selling Your Home

Such a scary game – selling your home. Your two possible fears: not selling high enough and not selling at all. There is a good chance that this will be the biggest transaction of your life. We’re also talking about selling your home. All the memories you’ve had. She was there for you in the good times and the bad – home-sweet-home. Interestingly enough though the market itself also has its good times and bad. So who do you trust with such high-stakes on the line? Not to worry; you hire an expert – your real estate agent! Of course she’s on your side. She knows the value of comparable homes, she knows the market up and down, she even knows the buyer’s frame of mind, and the best part? She works off commission! Perfect – your goals are aligned! The higher she sells the more you both make! Or so you are told…

Typically both agents, the buyer’s and the seller’s, have to split 6% of the amount the house is sold for. From there each agent has to give about half to his or her agency. So when all is said and done your realtor makes not 6%, not 3%, but 1.5% of the amount you sold your house for. So lets say for instance you have an offer on your home for $300,000. The 6% taken out would be $18,000 and the four-way split between the two realtors and each agency they both work for would each make $4,500. Ok, not a bad commission right? But wait, that’s not your concern. Your goal is to sell as high as possible. What was the words she used? “Maximize your house’s value.” Sounded like poetry when she first said it. So you bring those words up again. You ask her what she thinks about counter-offering for an extra $10,000 and why not? It’s worth a shot to put another $9,400 in your pocket after all the fees. What a great idea! Unfortunately, for you – the seller, that’s where you put your calculator down. The realtor has a little more math to do… “Hmmm” she says, “1.5% of another $10,000 would give me…” bust out the iPhone, calculator app, and… “$150?!?” More negotiating, more paper work, more time better spent on buying or selling other homes… Hmmmm, $150 is not looking too tempting. Remember, she is the one doing all the work while you’re sitting on the sidelines. On top of that, your dream of an extra $9,400 is not a concern to her. She has a life too even though she pretends to only care about yours. All of a sudden her tune changes… “Mr./Mrs./Ms. ___________, this may be the best offer you’re going to get. That newer house down the block has been listed for 12 months now and this is her third time putting it on the market. My advice is to accept the offer but it’s up to you though. We can try but we have an offer now. Is it worth it?”

@Darryl_Brian

Summarized from Freakonomics.

Advertisements

One thought on “Selling Your Home

  1. truuuuuuuuuuuuuuuuuue! you gotta find a realtor you like and that understands your frame of mind. theres absolutely nothing wrong with shopping around with a different realtor if the one you have isnt producing what you are looking for.

What are your thoughts?

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s