Should I offer "Courtesy to brokers" or not with FSBO?
Hi All, Hoping for advice… We have the first open house of our lovely restored Bed-Stuy brownstone condo’s this coming Sunday(come see! ad will be up on Brownstoner front page later in the week). Anyway, what I am trying to decide is if we should offer a courtesy to brokers or not. I’d love to…
Hi All,
Hoping for advice… We have the first open house of our lovely restored Bed-Stuy brownstone condo’s this coming Sunday(come see! ad will be up on Brownstoner front page later in the week). Anyway, what I am trying to decide is if we should offer a courtesy to brokers or not. I’d love to hear pro’s and con’s of both options. We don’t mind offering incentive and appreciation to anyone who brings us someone who ends up buying(Broker or not). Also would appreciate hearing what would be an appropriate amount/percentage. I often see FSBO’s that say “no brokers” and am wondering why. Any advice welcome.
Thanks!
A broker’s job is basically to do the work for you. If you’re a seller, your broker’s job is to place ads and pre-qualify buyers, etc. If you’re a buyer, your broker’s job is to read ads, find good properties, and negotiate, etc. If you’re willing to do all that stuff on your own, then you don’t need a broker and you shouldn’t hire the one’s who keep soliciting you. You might want to mention “no solicitation from brokers requesting an exclusive listing,” somewhere on your ad. If, however, you’re not able to find the perfect buyer on your own and a broker already has a pre-qualified one lined up, then I think it would make sense to give a courtesy commission.
The only thing that matters is that you get a good offer and sell the place.
Remember, only 2% of Open Houses result in sales. Anyone can advertise in the NY Times and have an Open House.
The biggest problem you’re going to have is that folks looking to buy an apartment in Bed Stuy are not going to be the strongest financially. Otherwise, they’d be looking somewhere else.
Unless you don’t mind spending several months showing unqualified “lookers” your apartment, I’d hire a broker and have him pre-qualify prospective buyers. You can also order your broker around to make life easier for yourself.
Unless you don’t work and don’t mind risking the further downfall of this shaky real estate market, you should hire a broker.
Of course, if you price the apartment well below market, it should go fast either way, but I highly doubt that’s your plan.
If you offering good incentive and appreciation it is very good to offer a courtesy to Brokers. Brokers will definetly give a good response.
i am not a broker, but a pro sales person in another profession. i do agree that a good sales person can pull together deals because they’ve been thru a lot of situations many times over. think that it’s really insulting to say all brokers are unethical, also not true.
Oh please, 9:22– I have yet to meet a broker who is truly professional. Most are sharky, unethical salespeople.
Get over yourselves people. You want to be your own broker, knock yourself out. The reason most FSBOs end up turning to a professional to represent them is because it is a lot more work than they realize. And its work that an experienced objective professional does better than the average homeowner. But you want to give it a shot that’s great. Best of luck. I mean it. But just because you are trying out the FSBO thing really doesn’t give you the right to insult a difficult profession. If you luck out and have smooth and easy marketing, negotiations, appraisals, closings that’s great. Most don’t. Ask any broker. It’s the rare deal that goes easily from start to finish. There’s a lot of moving pieces needing to be juggled, ignored, or just moved right along to the finish line. I think it might actually be dangerous to represent yourself if you are the sponsor of condos and you are not a professional who knows the risks in representing things from your offering plan. I would talk extensively to your attorney about this. The AG’s office has very specific rules about sales, marketing and representation of new development.
Thanks to the new posters! All this advice has been very helpful – I appreciate it so much.
Be prepared for brokers coming out of the woodwork to give you the hard sell on their services. It will almost seem like a conspiracy on their part to get the FSBO listing off the market and under a realty office. They must be having weekly meetings on the issue of FSBO’s in light of the weak housing market and the tendency for owners to try to go at it themselves. Stay strong and offer a percentage if they bring a buyer or go with an agency exclusive listing to allow yourself to sell the property on your own while a particular agency also has the right to sell. Try to avoid the Exclusive Right to Sell agreement, that’s the one they push on you for a 6 month period if they can. It means they alone have rights to sell. Good luck.
I would try at first to not allow brokers. Host a few open houses and see how it goes. We sold our last place in the East Village FSBO to a direct buyer without brokers. If you don’t get any bites in a few weeks then, as the above poster pointed out, increase the number of people considering your unit by allowing brokers. To be fair, we sold last year in a “still-hot” market. Also, several brokers called and said they wanted to bring clients. They offered to add 3% on top of the asking price, and if they could get their buyer to pay it, then they would keep the 3%. It seemed a little shady to me (particularly when the brokers asked that we not reveal to their buyers what the actual asking prices was). In the end, I was happy to avoid the brokers. Pay the fee to post on the NY Times, advertise on Craigslist and post some flyers in the hood. Finally, if you do allow brokers, make sure you know the rules – brokers will insist their agencies will not allow less than a 3% cut, or that the law will not allow it. This is not true. A contract for a fee with a broker is just like any other contract – terms can be negotiated – just be tough. But overall, in my opinion, stay away from brokers and try to sell on your own. Hopefully you will find nice buyers you are happy to sell your home to.