Here at RealDirect, our goal is to work with our clients in the way that suits them the best. Sometimes that means they use our free services (RealPrice). Other times we work on a monthly fee basis (as in our Owner Managed program). And still other times, we earn a commission Agent Managed and Buyer Service). However, not all commission based real estate brokers are the same, and to best understand our commission structure, you need to understand how the typical brokerage is compensated. (more…)
Archive for the ‘Working With Real Estate Brokers’ Category
If you are unfamiliar with the New York City housing market, closing on an apartment can be an intimidating process. However, a little bit of preparation can go a long way toward making your purchase as simple as possible. Buying real estate need not be a daunting task if you follow these three helpful tips for a stress-free NYC apartment closing.
1. Hire a good attorney.
To make negotiating a contract on an apartment easy in New York, you need a real estate attorney that can take the time to explain to you what is in the contract and how it affects you. This is a legal and binding document so you need to be sure you understand what you’re agreeing to. Try to find an attorney who understands your preferences and communication style, as he will be your primary point of contact during the negotiation process. (more…)
I sat down with a new client in Park Slope yesterday to talk about listing his townhouse for sale. When we meet our clients in person, we do a thorough walk through of the home, and then sit down and discuss pricing with an ipad, looking in real time at comparable properties (comps) – sold, in contract, and what is currently on the market. We don’t leave our clients a stack of fancy brochures – I never thought it made sense when everything we discuss is on online and on our web site. However, most brokers do leave packages, and in this case, our competition had left a package of what they considered to be comps. And the conclusion they reached based on the comps, was that the home should be priced about 20% higher than we said it should.
We warn sellers not to go with the broker that simply suggest the highest price. Instead, we recommend they spend the time to really understand the comps they are looking at, and price their home accordingly. However, brokers know that sellers often consider a high listing price to be an important factor for choosing who to list with, so the temptation is often too great for brokers to resist comp inflation.
In this case, the brokers that came before us put a comp set in front of the seller that did not include sale price. They merely had a single photo of the front of each house, the addresses, and the price per foot. They failed to explain that larger homes carry higher cost per foot than smaller, narrower homes like this seller. They also ignored condition, and how that impacts price. And they didn’t take into account the block – a park block in Park Slope typically sells for more than a townhouse near 5th Avenue. Finally, they failed to take into consideration whether the house was a 1 or 2 family home. Buyers will often pay a premium for a renovated 1 family home when compared to a multi-family dwelling that has had or currently has tenants in place.
After we walked through each of the homes that were listed as “comps”, it became very clear that nearly all of the comps that were in the shiny packet were not, in fact, comparable to the seller’s home, and that the price was completely unrealistic (although very attractive). We were able to produce several good comps – even one on the same block in a nearly identical house, that was left out of the other report. When we took some time to go through them in detail, I believe the owner had a much better view of the market and where his home should be priced. It will be interesting to see where he prices it, and who gets the listing…
If you’re selling your home on your own, you may be wondering how sellers can work with buyer’s agents. Many prospective buyers have aligned themselves with agents and establishing a “buyer agent friendly” mindset will help bring more potential buyers to your home.
How To Work With Buyer’s Agents Without The Stress
Nobody works for free. While you may be selling your own home to save money on commissions, you need to understand that a buyer’s agent expects to be paid for her efforts. If you’re not willing to pay the commission, the buyer will have to bear that burden. In a buyer’s housing market, how many buyers will make that concession? The good news is that a buyer’s agent will often be willing to take a 3% commission rather than the traditional 6% if the buyer’s agent is the only agent involved in the sale.
Going it alone. Besides reducing the pool of available buyers, working only with agent-less buyers may not save you anything in the long run. A buyer with the least bit of experience will probably insist on a discount that would be equal to the commission value. (more…)