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Updated almost 11 years ago, 02/28/2014

User Stats

67
Posts
0
Votes
Nick R.
  • Dallas, TX
0
Votes |
67
Posts

Having trouble choosing a Realtor

Nick R.
  • Dallas, TX
Posted

I'm flipping my first house which will be ready to put on the market a week from now. Here's my dilemma; picking a Realtor! This house is located in a diverse area with about a 50/50 mix of Hispanic and Caucasian families.

Option One: A Realtor who works with investors and was referred to me by the wholesale brokerage that I bought the house from. She will charge me 1% for basically just listing the house on the MLS and handling negotiations OR she will charge me 2% and do an "email blast" to other realtors on a weekly basis and pay for a professional photographer to take pics of the house.

Option Two: A Realtor who sold my own personal townhouse and was very professional ad did a great job but will charge me about 2.4% commission.

Option Three: A Realtor who sold a nearby house to the one I'm flipping for slightly over the asking price, is bilingual and specializes in selling to Hispanic families. I've not discussed commission with him but would be willing to use him for 2%.

I figure that for each percentage increase in commission, it will cost me approx $1700-1800.

Account Closed
  • Dallas, TX
744
Votes |
4,988
Posts
Account Closed
  • Dallas, TX
Replied

Paying a realtor 2% they are not much of a realtor. Let's flip this penny over are you willing to let someone tell you how much to sell your property for?


Joe Gore

User Stats

481
Posts
189
Votes
Huy N.
  • Houston, TX
189
Votes |
481
Posts
Huy N.
  • Houston, TX
Replied

I would go with the 1% option 1. Dallas and Houston market is very strong right now so if you fix it up nice, price it right and list on the MLS, you will get multiple offers.

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User Stats

271
Posts
106
Votes
Chris Sweeney
  • Real Estate Investor
  • Austin, TX
106
Votes |
271
Posts
Chris Sweeney
  • Real Estate Investor
  • Austin, TX
Replied

I think you can get full service and net more with the biggest hitter for your property. See if they will cut you a deal as you are an investor and will bring them more listings. Also, hitters will have off market deals you can pounce on. I think you could easily net less saving $1700 or $3400 going low budget than full service not considering future business with a hitter.

User Stats

403
Posts
59
Votes
Ben Hughes
  • Investor
  • Cypress, TX
59
Votes |
403
Posts
Ben Hughes
  • Investor
  • Cypress, TX
Replied

Don't they usually charge 5-6%?

User Stats

2,879
Posts
1,353
Votes
Mark Ferguson
  • Flipper/Rehabber
  • Greeley, CO
1,353
Votes |
2,879
Posts
Mark Ferguson
  • Flipper/Rehabber
  • Greeley, CO
Replied

Are you just talking about the listing side commission? As @Ben Hughes said total commission would include the listing agent and buyers agent. My theory is to pick the best agent in the area even if they charge more. They more than make up for the extra money in expertise and marketing. Underprice or overpricing a property will cost you much more than that 1% savings.

User Stats

151
Posts
55
Votes
Martin Zawarski
  • Contractor
  • Easton, PA
55
Votes |
151
Posts
Martin Zawarski
  • Contractor
  • Easton, PA
Replied

I don't know if I would use any of the three. I understand this is your first flip. I would try to use this situation into a long term relationship that is beneficial to you on not just this one deal. You need someone in your corner to help you with your next and your next and your next deal in both BUYING and SELLING. Find someone hungry who wants to form that kind of relationship. Post something on CRAIGSLIST that you are seeking a realtor to represent you in multiple deals and that you are an active investor. Get some resumes and then interview them and see how you click. forget the 1% OR 2% OR 3%. How can you parlay this opportunity to help you out in the long run??? They will make you more than the 1% savings many times over.

User Stats

1,368
Posts
647
Votes
Mark Updegraff
Agent
Property Manager
  • Investor
  • Rochester, NY
647
Votes |
1,368
Posts
Mark Updegraff
Agent
Property Manager
  • Investor
  • Rochester, NY
Replied

Option 3.
Sell that house & move on! You know the neighborhood & he'll get you the buyer.

Account Closed
  • Investor
  • Baltimore, MD
687
Votes |
1,368
Posts
Account Closed
  • Investor
  • Baltimore, MD
Replied

option 4, burn the place to the ground, collect the insurance money....don't forget the Picasso you had the was in the house

User Stats

97
Posts
37
Votes
Patrick T.
  • Specialist
  • Spokane, WA
37
Votes |
97
Posts
Patrick T.
  • Specialist
  • Spokane, WA
Replied

@Nick R. as a recovering realtor I have to say that @Mark Updegraff is right to a point.

But @Martin Zawarski has a long term vision in mind that will pay off in multiples. It is so easy and typical to get caught up in the "emergency" of the moment. Kick back and take a breath, you are in control. How are you going to build your future in this business...certainly not on one transaction. Cultivate relationships. Create future partners and referrals. Be a Pro, and be good to the other Pros.

User Stats

6
Posts
1
Votes
Jamal White
  • Investor
  • Chino, CA
1
Votes |
6
Posts
Jamal White
  • Investor
  • Chino, CA
Replied

Do you have a buyers list? If you do I would contact your cash buyers before you deal with a realtor.

Account Closed
  • Real Estate Investor
  • Phoenix, AZ
32
Votes |
58
Posts
Account Closed
  • Real Estate Investor
  • Phoenix, AZ
Replied

"Option Two: A Realtor who sold my own personal townhouse and was very professional ad did a great job but will charge me about 2.4% commission."

I assume that this is the listing side only. Cheapest is not always cheapest. A good agent will usually bring a higher selling price as much or more than their commission. I believe relationships are very important in business. If the agent did a good job for you before, why wouldn't you use them again? I would ask the agent if there is anyone in their office who speaks Spanish that they could co/list it with.

As an agent, the email blasts often gets annoying. Most agents block them. If you do choose a new agent: Ask how many listings they have sold in the area in the past year? Ask for previous MLS listings and references. Look at the "professional photography". What were the days on market? If high, why? List to sale price? It's not always the agents fault, sometimes you have unrealistic sellers. If you are unhappy, can you cancel the contract without paying them a commission? Length of contract?

A couple of things to look out for that I have run into by a few less than honest agents: "The interested buyer". I have a buyer who would be interested in buying your home. I just need you to sign the listing agreement before I can show it to him. After signing the contract, he brings the buyer over, who decides the home isn't right for him. The "buyer" was a friend or coworker used to get you to sign a listing contract that you can't get out of. "Buying a listing". An agent brings you an inflated CMA with bogus information. The seller picks him/her just because they brought the highest number, and signs a long-term contract. The agent knows that the property will never sell at that price, and soon starts to advise the seller to lower the price. The property sits on the market and becomes "market worn", until the seller lowers the price to were it sells, usually less than if it were priced correctly to begin with.

Good luck.

User Stats

96
Posts
19
Votes
Eric Blanchard
  • Specialist
  • Portland, OR
19
Votes |
96
Posts
Eric Blanchard
  • Specialist
  • Portland, OR
Replied

Got to go with @Martin Zawarski on this one. A good realtor is worth finding and keeping. I kissed a toad or two, but I'm happy with my current realtor (BP member Stewart Fox).

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User Stats

1,893
Posts
2,225
Votes
Dev Horn
Pro Member
#3 Marketing Your Property Contributor
  • Flipper/Rehabber
  • Arlington, TX
2,225
Votes |
1,893
Posts
Dev Horn
Pro Member
#3 Marketing Your Property Contributor
  • Flipper/Rehabber
  • Arlington, TX
Replied

Price not important? What if you can get the best people working for you at the best price? (2% is easy) That's certainly what I would want before I would concede on price in order to get quality (the best agent). This is the listing side - unless it's a high-end property that will be aggressively marketed, let's face it, it's about getting it on the MLS. One of the largest investors I know just pays a broker a flat rate to post his properties to MLS. The bilingual stuff, all that is more important on the BUYING side.

Your best opportunity to save money with RE agents/brokers is on negotiating the rate/fee on the listing side. Once it's on MLS in Dallas, it'll show & sell if it's nice and priced right.

  • Dev Horn
  • User Stats

    67
    Posts
    0
    Votes
    Nick R.
    • Dallas, TX
    0
    Votes |
    67
    Posts
    Nick R.
    • Dallas, TX
    Replied

    Thanks all for the replies, they've been VERY helpful and informative! (I should have clarified that this is for the listing commission only) After taking everything into account, I've decided to go with option #1 and use the Realtor who was recommended by the wholesale brokerage and who charges 1% commission. If this Realtor does a good job, then hopefully this is the first of many deals I'll use her. Also, as some have pointed out, the DFW area is pretty hot and this house is completely updated and will be aggressively priced so it should *hopefully* not need much marketing behind it other than the typical MLS listing (I will also be paying to have it professionally photographed).

    User Stats

    1,893
    Posts
    2,225
    Votes
    Dev Horn
    Pro Member
    #3 Marketing Your Property Contributor
    • Flipper/Rehabber
    • Arlington, TX
    2,225
    Votes |
    1,893
    Posts
    Dev Horn
    Pro Member
    #3 Marketing Your Property Contributor
    • Flipper/Rehabber
    • Arlington, TX
    Replied

    Good decision. Now, just make sure there are plenty of high quality photos - once on the MLS, that stuff shows up in Trulia, Realtor.com, etc. Lots of great photos on massively popular websites sell listed properties WAY more than listing agents. ;-)

  • Dev Horn
  • Account Closed
    • Dallas, TX
    744
    Votes |
    4,988
    Posts
    Account Closed
    • Dallas, TX
    Replied

    @Nick R.,

    Can you provide the agents name that is chargibng 1%?

    Joe Gore

    User Stats

    67
    Posts
    0
    Votes
    Nick R.
    • Dallas, TX
    0
    Votes |
    67
    Posts
    Nick R.
    • Dallas, TX
    Replied

    @Joe Gore,

    I can email you some info if you'd like, just provide me with your email address!