Clarification of Answer by
journalist-ga
on
04 Mar 2003 15:47 PST
My friend found the FSBO on her own. However, she had been working
with a ReMax agent looking at listed properties, too, and when she saw
the FSBO while they were out seeing houses one day, she liked it and
contacted the buyer directly.
Then, after my friend saw the FSBO, she phoned the realtor and asked
what would be the charge for the realty company to take care of the
sale. The realtor stated 3%.
Although my friend could have handled the purchase through other
means, such as paying a lawyer (because she found the FSBO, not the
realtor so neither she nor the seller had any obligation to the
realtor), she chose to honor the realtor with a buyer's commmission
because she had seen the FSBO while looking at nearby property *with*
the realtor (who had shown her a lot of properties during the weeks
before). The purchase was then handled professionally sparing my
friend any headaches with any part of the purchase, necessary papers,
etc.
In the transaction, my friend added the commission to the sale price
of the property and then the seller immediately gave back the added
commission to the realtor. In essence, my friend paid the realtor a
seller's commission but it was half the 6% the seller would have paid
a realtor had the property been listed. The realty agency had
incurred no expenses for listing, advertising, etc. so they were
pleased enough with 3%.
This is done frequently by realtors with FSBOs. It's just not widely
known because the realtor makes less so they don't encourage the
practice.
The attractive part for my friend was this: She had seen homes in the
same neighborhood through the realtor for $7,000 to $10,000 more than
the FSBO. The FSBO commission she paid was under $2,000. So my
friend bought her home for under market value in the area where she
preferred to live. Even after her closing costs she came in under the
asking price of the other homes in the neighborhood. She recieved
instant equity that way.
Most realtors will deal just like other salespeople deal. If I am not
mistaken, ReMax is mostly all brokers, if not all and it's a franchise
name. They pay commission only to themselves and their business
expenses (office, etc).
Regarding FSBOs being less effective, that depends on if you choose to
advertise the property in a local paper or on a local website. Part
of the realtor's general commission is to handle promotion of the
property. Also, if a property is for sale near you, with a sign,
people visiting that property will see your sign. In a condo area,
there is usually a steady flow of traffic and neighbors will mention
it to friends and co-workers. Two of my other friends have bought
FSBOs because of a lead they heard at work from the FSBO neighbor.
