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Lower your Listing/Selling Fees - Use Flat Rate MLS

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Deal Guru
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Mar 31, 2008
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Donnie740 wrote:
May 31st, 2014 10:19 pm
Except that the seller paid you upfront. And now they're sitting with an unsold property and $800 LESS in their pocket. I'd say that's problematic for the seller. You've already collected the majority of your commission just by listing the property. In comparison to a "typical" full service realtor who gets paid after delivering results - - ie. getting the property sold.




And therein lies the problem with trying to compete on price with a low margin high volume business model. You're offering to give away 50% of your earnings now. What happens when "Captain John" comes along offering to give away 60% of his earnings? And then "Captain Shawn" figures he'll go one better and give away 75% of his earnings?
He's such a fool.. such a fool. When will he learn?
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dec12 wrote:
May 31st, 2014 7:28 pm
It's a good thing that OP didn't put all the time and effort into prostitution "marketing plan". I'd assume that you would ask her to go down Parkdale and start making actual money.
Doesn't matter what it is - - when you put your time, effort and money into something and then do absolutely ZERO with it you're a total waste.

It's no different than someone putting in four years of study and spending tens of thousands on tuition to get an electrical engineering degree then sitting around unemployed for a decade when 96% of electrical engineering grads are fully employed within their industry. Complete waste.
[OP]
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Donnie740 wrote:
May 31st, 2014 10:24 pm
LOL, you're about 4 years behind the times. MLS has been open to the public since 2010.

http://http://www.theglobeandmail.com/r ... le1771467/
And how sweet it is! Next comes the historical sales data which will become open when TREB/MLS loses yet again.

2.5% full service listing agents are fretting about this but I wonder why since they say the provide so much value add. They shouldn't care at all. TREB/MLS shouldn't care at all either. But, they do. Hmmmmm.
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Dec 3, 2013
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I see nothing wrong with a listing agent charging 5% (2.5%+2.5%) if they provide services for their clients. By services I mean Cleaning,moving,garbage disposal,staging etc. These are things that cost money/time and most likely will need to be delegated to someone else. If the agent is just going to list the property and offer nothing else. Then no....they do not deserve it.

I understand if you feel Realtor's are overpaid. Everyone is allowed to have their opinion. I would actually encourage you to pick it up as a career if you think its easy money.

Captain Ron is a very successful Realtor in Victoria. Excellent. Happy for him. His business model works there and I would encourage him to keep doing what he is doing. The same model he is working in his home town, does not work in Toronto. There are literally tens of thousands of agents in the GTA alone. Of these 30,000 or so, I would say 10% of them are doing 90% of the business. The top tier Realtor's literally spend a fortune on marketing because with so many agents around they need to stand out and keep the business coming. Captain Ron's business model would be instantly suffocated in such a competitive market due to the fact that their are thousands doing the same thing he is.

So in conclusion. The most productive and successful Realtor is the one who best markets themselves. Their big marketing budgets do not come from thin air either. They have clients eager to do business with them and pay full pop for their services due to their visibility,Rolodex of past clients and their reputation. While the Realtor's working for nothing are the ones doing nothing.

Low commission is not the enemy. Getting no value for the equity in your home is the enemy.
[OP]
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Donnie740 wrote:
May 31st, 2014 10:32 pm
Doesn't matter what it is - - when you put your time, effort and money into something and then do absolutely ZERO with it you're a total waste.
I've already been contacted by a couple people via PM who are using my template to market their home via MLS. And my partnership is using it for our sale too. Countless people have commented on this thread how they value that information. Some even posted on here that my post should be made a STICKY. That's HARDLY putting it to waste!

But, moreover, what you can't seem to understand neither I nor any property owner needs to have a real estate licence to perform all of the steps in my post #1 How to lower your Real Estate Agent Transaction Fees
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Aug 19, 2008
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eonibm wrote:
May 31st, 2014 11:07 pm
I've already been contacted by a couple people via PM who are using my template to market their home via MLS. And my partnership is using it for our sale too. Countless people have commented on this thread how they value that information. Some even posted on here that my post should be made a STICKY. That's HARDLY putting it to waste!

But, moreover, what you can't seem to understand neither I nor any property owner needs to have a real estate licence to perform all of the steps in my post #1 How to lower your Real Estate Agent Transaction Fees

Lots of luck to both you and them.
[OP]
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Donnie740 wrote:
May 31st, 2014 11:12 pm
Lots of luck to both you and them.
Thanks, but it's just as much luck as you require to have buyers submit offers once you list the property on MLS.
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Nov 19, 2004
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Cambridge, ON
Donnie740 wrote:
May 31st, 2014 10:19 pm

And therein lies the problem with trying to compete on price with a low margin high volume business model. You're offering to give away 50% of your earnings now. What happens when "Captain John" comes along offering to give away 60% of his earnings? And then "Captain Shawn" figures he'll go one better and give away 75% of his earnings?
He will have to continue to evolve his model to where he thinks is best. Unlike the Donnie's and Bonnie's who will just continue to lose even more as they try desperately to hang on to an antiquated model, at least he will still be in the game. Let's face it, are you more concerned with Captain Ron or for yourself?

Take a look at what Realtors used to do 15-20 yrs ago to earn the 4-5% commission and compare with what they do now. And as mentioned, with such a large number of Realtors competing for business, maybe it is time to look at what will make you stand out.
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May 6, 2010
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Markham
Donnie740 wrote:
May 31st, 2014 10:32 pm
Doesn't matter what it is - - when you put your time, effort and money into something and then do absolutely ZERO with it you're a total waste.

It's no different than someone putting in four years of study and spending tens of thousands on tuition to get an electrical engineering degree then sitting around unemployed for a decade when 96% of electrical engineering grads are fully employed within their industry. Complete waste.
Oh the irony. I think you just insulted a lot of agents with engineer degree. With your mathematical prowess, re: $15,000 loan with only $15 per month repayment, I really doubt that EE majors have 96% full employment.

It's not total waste for the EE majors to find other employment. Finance 101 refers to it as sunk cost. The time and effort spent on the degrees are gone. They can spend more money and time to update their skills in hope of finding engineering career or write the whole thing off and start another career.

Another financial concept I think you have a time to grasp is intrinsic value. It's great that my prostitutes can recite Hamlet in 30 different language but I'm not paying for it. Their intrinsic value is base on the ability to bend over. Similarly, my agent can recite Hamlet in 30 different language but I'm not paying for it. I'm paying my agent for the negotiation process. Every prostitute, er agent, is offering free market evaluation and marketing plans. I'm not even sure I'm getting value for the negotiation. The decision makers, buyers/sellers, mostly like have a figure in their minds and will not budge from this figure. I'd figure the pressure to close the deal would come from their own agents, the ones they hired to get them the best deal.

You chided Captain Ron for charging 1/8th for the same service. Flip it around, why should a client pay 8 times intrinsic value for your service and not Ron?
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Oct 31, 2008
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dec12 wrote:
Jun 1st, 2014 9:32 am
It's great that my prostitutes can recite Hamlet in 30 different language but I'm not paying for it.
You have a unique take on the "talk dirty to me" concept.

"To sleep, perchance to dream - ay, there's the rub"
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May 6, 2014
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professor24 wrote:
May 31st, 2014 11:04 pm
I see nothing wrong with a listing agent charging 5% (2.5%+2.5%) if they provide services for their clients. By services I mean Cleaning,moving,garbage disposal,staging etc. These are things that cost money/time and most likely will need to be delegated to someone else. If the agent is just going to list the property and offer nothing else. Then no....they do not deserve it.

I understand if you feel Realtor's are overpaid. Everyone is allowed to have their opinion. I would actually encourage you to pick it up as a career if you think its easy money.

Captain Ron is a very successful Realtor in Victoria. Excellent. Happy for him. His business model works there and I would encourage him to keep doing what he is doing. The same model he is working in his home town, does not work in Toronto. There are literally tens of thousands of agents in the GTA alone. Of these 30,000 or so, I would say 10% of them are doing 90% of the business. The top tier Realtor's literally spend a fortune on marketing because with so many agents around they need to stand out and keep the business coming. Captain Ron's business model would be instantly suffocated in such a competitive market due to the fact that their are thousands doing the same thing he is.

So in conclusion. The most productive and successful Realtor is the one who best markets themselves. Their big marketing budgets do not come from thin air either. They have clients eager to do business with them and pay full pop for their services due to their visibility,Rolodex of past clients and their reputation. While the Realtor's working for nothing are the ones doing nothing.

Low commission is not the enemy. Getting no value for the equity in your home is the enemy.
That's the million dollar question. Most don't..only some do .

Also if they didn't help you get a better price than you could have got on your own, that 2.5 % is wasted.

Its like paying someone to find a lower insurance or mortgage for you & they get it for the same price or higher price than you could have got on your own. I know they get paid by the bank/insurance company & not by you in this case..but just giving an example in case you had to pay these insurance/mortgage brokers a commission.
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Jul 3, 2011
5249 posts
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Thornhill
I appreciate your response Captain_Ron5.

Here’s the reason I asked the question for those who haven’t figured it out. It is quite easy to be an armchair critic and make pronouncements about what others in any vocation do, don’t do are worth and not worth, then when the reality sets in, they find it’s not quite as they represented it out to be. But it serves its purpose at the time to stir up armchair critics which ultimately leads to a bashing of that industry, regardless of what that industry is – mechanics, contractors, lawyers, dentists, civil servants, take your pick.

The crux of your answer establishes Captian_Ron5 that when you locked onto that 10 hours to sell, your only focus was on measuring the number of hours worked by what you saw the Realtors do when dealing with them and now that you’re in the business that measurement of 70 hours per week now includes the time spent on tire kicking buyers, failed sales and undoubtedly all of your self-marketing efforts to generate business. That cost of business is built into every company’s pricing model from the grocery store with its spoiled goods to the company whose employees spend half their work day cruising the internet on the company’s dime.

Very often in RFD we find posters stating they don’t care how many tire kickers et al a Realtor has to deal with and that there is no reason why someone else should pay for that lost time. The lament often comes with a stated value for the service which you’ve likely seen, that is anywhere from $500 to 1% maximum just as yours was back in 2010. The more oft refrain is, “Realtors aren’t doing twice the work so why is their fee still the same percentage when prices have doubled?”. In essence if another Realtor came in here and said, ‘it’s ridiculous to charge more than $500 to sell a house and there is no reason not to rebate 90% minimum to a buyer’ that Realtor will be a hero and even your fees will be slagged.

That you changed your pricing because you could, is precisely the same reason all Realtors who have higher fees than you do so, that is the value they place on their service, time, effort and knowledge – it’s their right to choose whatever model and fee arrangement they want just as it is the right of every consumer to choose which they want. Once again, and understand I’m not picking on you, you’re the perfect candidate having gone from outsider - “$2,000 flat fee listing, 70% minimum rebate” to an insider, to illustrate to all of those outsiders making such pronouncements that reality sings a different tune.
Captain_Ron5 wrote:
May 31st, 2014 7:29 pm
i/ Buyers eat up most of my time....

Problem is many listings don't sell, but that is my problem, not the sellers' problem. If I am willing to take on two listings and one doesn't sell and the other takes me 10 hours to sell I can't justify that the average is 20 hours to sell a property. I didn't make the right business choice taking on the listing that didn't sell. Anyway, that is my take on it.

ii/ I changed my pricing levels because I could...

Do I think I am worth $250,000-$300,000/year? No, but I run a business and every year I change my pricing levels to increase sales and profits....
[OP]
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professor24 wrote:
May 31st, 2014 11:04 pm
I see nothing wrong with a listing agent charging 5% (2.5%+2.5%) if they provide services for their clients. By services I mean Cleaning,moving,garbage disposal,staging etc. These are things that cost money/time and most likely will need to be delegated to someone else. If the agent is just going to list the property and offer nothing else. Then no....they do not deserve it.
Aside from the fact that you can do it yourself or pay less than a $1K for 'Cleaning, moving, garbage disposal and about the same for staging unless you are doing a major staging job with new furniture I have yet to have any agent either do or pay for any of this for me. You need to pay 2.5% to tell you to have your place cleaned, garbage removed and staged? There, I told you for free!
professor24 wrote:
May 31st, 2014 11:04 pm
I understand if you feel Realtor's are overpaid. Everyone is allowed to have their opinion. I would actually encourage you to pick it up as a career if you think its easy money.
Bad advice. No one needs to take up real estate as a career to sell their home with a flat-rate listing on MLS just like they don't need to become a plumber to do their own plumbing, landscaper to do their own landscaping, carpenter to build your own deck, car dealer to sell you car, computer programmer to program a spreadsheet etc. What a ridiculous statement.
professor24 wrote:
May 31st, 2014 11:04 pm
Captain Ron is a very successful Realtor in Victoria. Excellent. Happy for him. His business model works there and I would encourage him to keep doing what he is doing. The same model he is working in his home town, does not work in Toronto. There are literally tens of thousands of agents in the GTA alone. Of these 30,000 or so, I would say 10% of them are doing 90% of the business. The top tier Realtor's literally spend a fortune on marketing because with so many agents around they need to stand out and keep the business coming. Captain Ron's business model would be instantly suffocated in such a competitive market due to the fact that their are thousands doing the same thing he is.
This thread is about lowering your real estate transaction fees, not incessant criticism about Captain_Ron5's fantastic ground-breaking and successful 1/2 cash back full service business plan, but I'll indulge you for a moment since you and the real estate agents on here keep bringing him up. You are conveniently sweeping under the rug the fact that Donnie740, apparently a seasoned real estate agent at the time, told Captain_Ron5 in April 2010 on his Ask me Anything... I am a Real Estate Agent thread that his business plan would not work anywhere! So much for you or him knowing what works and what doesn't. Business is business and I know many people that would love to get 1/2 cash back here in Toronto.

But your comment is oh so telling. You say you are worried that Ron's business model would be instantly suffocated in our competitive market and real estate commissions would go down because thousands would do the same thing. Well, la-di-da, so your big fear is that commission rates would go down not that full service clients would then have a greater chance of getting 1/2 cash back and full service listing fees would be cut in half and thereby saving a lot of money. That's what the industry and you fear most because it will hit you in the pocket book.

But, it's obvious you and real estate agents are more interested in what is good for you rather than the client.
professor24 wrote:
May 31st, 2014 11:04 pm
So in conclusion. The most productive and successful Realtor is the one who best markets themselves. Their big marketing budgets do not come from thin air either. They have clients eager to do business with them and pay full pop for their services due to their visibility,Rolodex of past clients and their reputation. While the Realtor's working for nothing are the ones doing nothing.
You are right 'The most productive and successful Realtor is the one who best markets themselves' and thereby deluding people into thinking their over-priced services are worth it.
professor24 wrote:
May 31st, 2014 11:04 pm
Low commission is not the enemy. Getting no value for the equity in your home is the enemy.
High commission is the enemy. Getting no value for the 2.5% listing fee for your home is the enemy. These fees which have recently doubled with the price of homes yet the little work real estate agents do to list a home has stayed the same. Why don't they rise with inflation? Post your home on MLS using a flat-rate listing just like real estate agents do using my post #1 How to lower your Real Estate Agent Transaction Fees Give the buyer's agent the 2.5% not the sellers. You can do all the menial tasks they do by yourself very easily now since the MLS was deemed to act uncompetitively and therefore forced by the Competition Bureau to open up their MLS system. Obviously if agents added so much value they wouldn't have fought that court case as strongly as they did. The words 'thou doth protest to much' come to mind...
[OP]
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Aug 2, 2010
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licenced wrote:
Jun 1st, 2014 10:40 am
I appreciate your response Captain_Ron5.

Here’s the reason I asked the question for those who haven’t figured it out. It is quite easy to be an armchair critic and make pronouncements about what others in any vocation do, don’t do are worth and not worth, then when the reality sets in, they find it’s not quite as they represented it out to be. But it serves its purpose at the time to stir up armchair critics which ultimately leads to a bashing of that industry, regardless of what that industry is – mechanics, contractors, lawyers, dentists, civil servants, take your pick.

The crux of your answer establishes Captian_Ron5 that when you locked onto that 10 hours to sell, your only focus was on measuring the number of hours worked by what you saw the Realtors do when dealing with them and now that you’re in the business that measurement of 70 hours per week now includes the time spent on tire kicking buyers, failed sales and undoubtedly all of your self-marketing efforts to generate business. That cost of business is built into every company’s pricing model from the grocery store with its spoiled goods to the company whose employees spend half their work day cruising the internet on the company’s dime.

Very often in RFD we find posters stating they don’t care how many tire kickers et al a Realtor has to deal with and that there is no reason why someone else should pay for that lost time. The lament often comes with a stated value for the service which you’ve likely seen, that is anywhere from $500 to 1% maximum just as yours was back in 2010. The more oft refrain is, “Realtors aren’t doing twice the work so why is their fee still the same percentage when prices have doubled?”. In essence if another Realtor came in here and said, ‘it’s ridiculous to charge more than $500 to sell a house and there is no reason not to rebate 90% minimum to a buyer’ that Realtor will be a hero and even your fees will be slagged.

That you changed your pricing because you could, is precisely the same reason all Realtors who have higher fees than you do so, that is the value they place on their service, time, effort and knowledge – it’s their right to choose whatever model and fee arrangement they want just as it is the right of every consumer to choose which they want. Once again, and understand I’m not picking on you, you’re the perfect candidate having gone from outsider - “$2,000 flat fee listing, 70% minimum rebate” to an insider, to illustrate to all of those outsiders making such pronouncements that reality sings a different tune.
Thanks for proving my point. Realtors will charge what the market will bear not what their services are worth. And, they guard this monopoly so much that they are willing to go to court to protect it. Yet at the same time they say they add so much value that it doesn't matter now that people can get a flat-rate listing on MLS on their own, something they opposed vociferously. Well, you can't blow hot and cold at the same time!

There is absolutely no reason agents should get paid double what they did 10 years ago in a market like Toronto (given the doubling of property prices) for the same work. No one else's wages has doubled in that time frame. It's only the fact 1) they have a monopoly that allows this to continue and 2) effective marketing that selling real estate is so much work and not something someone can do on their own.

Well, ain't it very telling that the agents on here are still struggling to find one item that is a part of their 'marketing plan' that they can add to mine in post #1 How to lower your Real Estate Agent Transaction Fees which shows you how to get the same MLS listing and do exactly the same thing a listing agent does on your own. Remember, in 99% of the cases it's the buyer's agent that brings in the buyer, not the listing agent. There's only one listing agent, there are 1000's of buyer's agents. Makes sense it is so low. Pay the buyer's agent 2.5% when they bring in someone who buys your home and don't waste money on a full-service listing unless you don't mind spending the 2.5%. It's your choice. I'd rather spend the 2.5% on myself.

Btw, you asked me how I know what commission rates the listing agent gets on particular properties? Figured it out yet? And, um, you're the real estate agent, not me! LMAO!!!

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