Flat rate real estate is in its infancy. The Internet has had the biggest impact and the ability for a real estate brokerage to use the web as a means to market Georgia homes for sale is one of the major contributors to the birth of flat rate real estate.
This is how it typically works: A home owner lists the home for sale with a flat rate mls real estate brokerage such as DitY Realty (DitY stands for do it yourself realty / real estate). The flat rate covers the cost of putting the home on various local, national, and proprietary websites. It typically covers the cost of putting it on the mls, although many of DitY Realty's competitors charge an extra fee (i.e. an additional $195) for posting the home to the local mls. Once the home has been posted to the websites and/or the mls the flat rate company simply lets the marketing do its job.
What's not included in the flat rate is the cost to bring a buyer. The fee to bring a buyer to the table is not set by law; it is set by local markets. Often the buyer's agent earns 3% in commission for bringing a buyer. A seller's agent (traditional or flat rate) must post on the mls the commission amount the seller is willing to pay. Yes it is possible to post zero % but then a seller should expect to get zero activity from real estate agents with qualified buyers. Chasing buyer’s agents away defeats the purpose of using the Georgia mls entirely.
Our suggestion is to research the going rate for the Georgia real estate market in which the home is located and offer that amount to buyer's agents. If the total going rate is 6% and the buyer's agent earns half (3%) then a savvy seller can use a flat rate real estate brokerage and save roughly 50% over the traditional real estate business model.
We have found this business model is one of the best real estate business models to be developed in many, many years. For business minded sellers such as builders, investors, or sellers that have business sense, it is a great solution. It is better than for sale by owner and it is less expensive than the traditional real estate model. Keep in mind it is not the solution for ALL sellers...I'll cover who should avoid it in my next blog.
What do you think of the impact of flat rate mls listings?
Original post on Point2.
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