This regularly-scheduled sponsored Q&A column is written by Adam Gallegos of Arlington-based real estate firm Arbour Realty, voted one of Arlington Magazine’s Best Realtors of 2013. Please submit follow-up questions in the comments section or via email.
Question: I own a townhouse in a community in Falls Church where demand outpaces supply. Houses consistently go on the market and receive multiple offers above asking price within a few days. If and when I decide to sell, what are my options for negotiating compensation with my agent? I want to ensure the agent is fairly compensated while taking into account the fact that little time and effort is required on the agent’s part. Any info on negotiating commission, proposing an hourly rate, or using a real estate attorney (FSBO) is greatly appreciated.
There really isn’t a one size fits all answer to your question, but I’ll provide you with some things to think about so that you can decide which option is the best for you.
For Sale By Owner
The easiest option to address is selling the home on your own as a for sale by owner (FSBO). You live in a desirable neighborhood so it sounds like you are confident your home will sell quickly. You can go bare bones and just put up some signs and a Craigslist ad. Hire an attorney to help you with the contract and save most of the money you would have paid a real estate professional. In fact, the broker / owner of Frankly Realty wrote an article that discusses this very strategy: Go FSBO! Save $20,000! Realtor Tells All!!
Five Reasons To Hire A Listing Agent
Even if you are confident in your home’s ability to sell and have plenty of free time, you may still want to consider hiring a real estate professional. Below are five points I recommend that you consider.
1) Maximum Exposure: My goal is to generate as much interest as possible so that my clients hold the upper hand in our negotiations with potential buyers. It’s the key to maximizing the sales price and negotiating terms that are preferable to my clients.
I think of the listing as a unique brand that requires a professional image and a custom marketing plan. High quality professional photographs of the home and community are the cornerstone to our marketing. Depending on the home we may also include evening photos, aerial photos and video. These are used in the MLS listing and throughout our print and online marketing. I am happy to show you any of my past listings so you can see how they stand out from the crowd.
Though the MLS is an important tool for reaching thousands of homebuyers and their agents, I feel that it is only one of many other marketing channels that should be leveraged. I utilize every website and social media channel available to reach our target market and create interest in my listings. I would be happy to speak with you about this more specifically, but I can’t give away all my secrets in this forum. Some of our marketing plans also include a strategic dose of direct mail and print advertising. I also place an emphasis on pre-marketing the listings so that there is buzz before the listing goes live and begins collecting days-on-market.
Of course you can also count on the essentials like signage, professional quality brochures, open houses, broker open house events, community insights and inclusion in our monthly e-newsletter.
2) Proper Pricing: The real estate market is very fluid and fluctuates constantly. Knowing what nearby homes have recently sold for is only one component. The art of properly pricing a home requires you to have a finger on the pulse of the market and the ability to predict how the market will react to your pricing strategy. It’s a fragile balance between pricing too low and possibly leaving money on the table and pricing too high where your listing gets rejected by the market, lowering the perceived value.
3) Preparation for Market: Do not underestimate how valuable it is to get your home in the right showing condition to maximize your profit on the sale. It’s invaluable to have a market expert help you weigh the cost/benefit of making improvements to your home before it goes on the market. Improvements can be as minor as rearranging furniture a different way and painting a room the right color. We’ve also helped clients who were able to attain significant return on investment by updating major items like the kitchen and flooring in their home.