Noelle Stevens

In a report by the Federal Trade Commission and the U.S. Department of Justice entitled Competition In The Real Estate Industry, a discussion amongst a panel about non-traditional business models turned up some interesting facts:

Many consumers prefer to use brokers whose business models are alternatives to traditional real estate real estate practices.

The growing popularity of these non-traditional brokers is linked to consumers’ use of and comfort with the Internet.

The Flat Fee or Limited Service real estate business model is likely to benefit consumers who do not want to forgo broker assistance completely but who feel comfortable handling aspects of the transaction without assistance.

First, an overview of Flat Fee real estate: Flat Fee brokers offer home sellers the option to purchase less than the full bundle of services traditional brokers provide. Most importantly: the MLS listing package, which allows consumers, who are not permitted to list homes in the MLS without a licensed broker, to list a home in the MLS by contracting with a broker who is a member of the local MLS.

Bottom line: If you need to sell a home, you need to be listed in the local Multiple Listing Service. The MLS is the primary source of home listings information because it contains real time information on virtually every home listed for sale in a given area, except FSBO homes. Agents use this database to “share” listings with other agents working with buyers. Once a listing agreement is signed, a listing agent places your property in the MLS and promises to co-operate (or Co-op) with a buyers’ agent.

When you sign a listing agreement, you agree to compensate your agent anywhere from 4%-7% of the sale price of the home. This percentage is typically split in the middle, and half of it is offered as a co-op commission to the buyers’ agent.

Flat Fee real estate brokers place your home in the local MLS for a fee ranging from $169 to $699. Basic selling aids are typically included: Signage, Internet advertising and lockbox are pretty standard. Here’s the deal…Flat Fee MLS marketing allows the seller to offer compensation to only one side of the transaction: the buyers’ agent. This means that if the going commission rate in your area is 6%, sellers only have to pay out 3% to a buyers’ agent. The listing side half is covered by the flat fee! Best of all: YOU RETAIN THE RIGHT TO SELL BY OWNER! If a buyer approaches you directly with no agent involved, you pay no commission!

By now you may be wondering: Do I need a Realtor? You may, but only if you are unable to handle showings yourself. If you’ve moved to another state, you may need full service. Sellers will also need to negotiate offers and handle inspections and other contingencies. A real estate attorney can handle title and closing documents (usually for a flat fee of about $400-$500).

If saving money is a priority, Flat Fee real estate may be the best option, since the Internet has surpassed the yard sign as the most important marketing tool to reach consumers, and the MLS exposes listings to the widest audience of potential buyers and real estate professional working with qualified buyers, thus increasing the probability of selling your home quickly and at an optimal price.

MadisonFlatFeeHomes.com is South Central Wisconsin’s premiere Flat Fee MLS marketing firm, offering our exclusive $399 Listing Package to sellers in and around the Madison area. Our Internet marketing strategy places our listings in front of thousands of buyers every day. Our sellers receive professional virtual tours and photography, courtesy of Virtual Tour Madison and syndication to over 100 of the top real estate websites and a Showcase Listing on Realtor.com, the Nations’ #1 Real Estate website!

Our Buyer Rebate Program allows buyers who are willing to do a bit of the legwork and follow a few simple guidelines to receive a 50% refund of our commission upon closing!

For more information, please visit our site: MadisonFlatFeeHomes.com