Experience with Homecoin?

Question

Hi all - I am considering to sell my townhome for-sale-by-owner (FSBO) using Homecoin or potentially another service. Wondering if anyone on the forums has used this service and can comment on their experience.  Thanks!

Jenifer Levini · Answer

I have to admit that I am confused by your response @Jon Minerick. It looks like Homecoin saves money for buyers and sellers by eliminating real estate agents and brokers from the process, allowing FSBO-sellers access to the tools like MLS and lock boxes. How do you, as a broker,  fit into this process? Are you receiving any commissions?

Kevin Kraver · Answer

Thanks @Jon Minerick for the detailed (albeit biased) response. I have reviewed many of the Yelp reviews and see your name popping up with many favorable comments.

If I end up going with Homecoin or other flat fee service, I'll update this thread as it plays out.

Jonathan Minerick · Answer

Hi Kevin,

I'd love to answer this one, but I'm a bit biased :)

The reviews you find on a site like Yelp are, in my opinion, the most accurate feedback you are going to get on a company. People seem to take a little more pride/ownership over their Yelp reviews (whereas on Zillow, everyone seems to be a five star agent).

I also find it very interesting to look at the companies lowest reviews - they can fake some reviews, but with enough business you'll always get real customers giving real reviews.

Here's the best advice I can offer on what to look for in any flat fee listing:

1. The listing MUST be on the local MLS

There are hundreds of MLSs in the United States. Sellers want to be on the MLS that covers the area where their home is located, so they can offer a commission to LOCAL buyer agents.

2. Cost to List + Changes to Listing

Can range from ~$100-$400 for the exact same listing on the MLS. Watch out for fine print that requires an additional fee at closing - this is a huge red flag. Make sure you are able to make changes to the listing after it has been posted for a nominal fee. Note that a change can be anything such as pictures, description, price and status.

3. Photos on MLS

Make sure you can upload at least 12 photos. Some services offer a great price, but it's only for 1 photo - which is not useful for most properties. Home buyers are very easily visually influenced. Pictures work wonders and numerous studies have shown that pro photography pays for itself many times over.

4. Length of Listing

Get at least a 6 month listing and be sure that there is no charge for cancellation. Homes rarely sell as quickly as their owners think they will, even when the owner is sure the home is priced perfectly.

5. Fine Print

You should never be required to use any closing service (e.g. escrow) provided by the flat fee service agent. Read the listing agreement carefully - you will be required to sign it in every state.

6. Be Careful With Referral Services

Many of the flat fee MLS listing service providers you come across on the internet are actually just middlemen. These referral services find flat fee agents in each state and then advertise flat fee MLS listing service to sellers. These referral services have you add property info, photos, etc. but then send your info to the listing agent who does the work (and gets paid by the referral service).

Best of luck on the sale!

Jon

Amber Smith · Answer

Hi @Kevin Kraver, I have recently been looking into this service since a new listing popped up on my local MLS and as a realtor, I was confused by the info in the listing regarding the agent/seller relationship. The listing made it clear the agent did not represent the seller in any way, nor back up any of the info stated in the listing. I have had zero experience with this company, but just wanted to offer my 2 cents as an agent.

I looked at their site and yes, they do offer a straight MLS listing for as low as 95$, but the additional services are where they can add up to the same cost or higher than a listing agent would charge you; ie: premium help with forms- $2999, lock box $125 (some local MLS, including my local MLS, specifically BAN non-mls provided lock boxes & if reported your listing can be removed), for sale sign (in your area, SJ) $110, etc etc.

Depending on the price of the house youre selling, those fees can quickly add up to be close to or more than what you'd pay a traditional listing agent. Beyond the fees, though, my main concern would be the potential liability you open yourself up to by essentially representing yourself. Agents and sellers have to disclose A LOT of information about the house youre selling and any errors, omissions or just plain honest mistakes can open you up to potentially costly liability. Agents are there to guide you on what to disclose, how to do it properly and why its important, among other things.

In addition to the liability, the actual mundane back and forth process of escrow can be a lot of stress for a seller to tackle on their own. There are deadlines to follow on when certain forms have to be returned. Also, what forms does the buyer need to send you vs you send to the buyer? What situations can the seller keep the buyers deposit if they cancel the sale? Who deals with and often advocates on your behalf to the appraiser? Who deals with the request for repairs and knows what is standard, excessive, easy & cheap to fix because they have local contacts? Who talks to the buyers lender on sometimes a daily basis to make sure escrow closes on time? There are sooooo many things that agents deal with on a daily basis that you, as a seller, would probably think of as a nightmare lol.

All that said, I do NOT want to seem as if Im discouraging you from using this service or have any experience dealing with them, as I have not. I am not even close to SJ, nor do I know anyone in that area, so Im also not soliciting you for any business. I just found this post in my recent research on flat-fee RE services and wanted to share my thoughts. Last thing Ill add is that RE agents are everywhere and many are discounting their commission to as low as 1% in order to gain business. I personally have offered a discounted commission many times for friends, family or in a situation with a lot of competition. I would bet that if you call around to your local agents at different offices and really interview them, you could find a few you trust that would offer a lower commission to win your business.

Good luck with your selling journey!

Jonathan Minerick · Answer

@Jenifer Levini What we do as a broker is price each real estate service individually and let the consumer decide what they want to purchase.

For example, a home seller can purchase an MLS listing from us for $95, and that is all the money we make. We offer nearly all the same services that a traditional agent would.

Our model, known as "Fee For Service" or "Flat Fee", is something the U.S. Dept. of Justice has advocated to sellers/buyers for many years. See their webpage devoted to this here: https://www.justice.gov/atr/consumers-save-thousands-commissions

Note that some states require sellers/buyers to purchase certain brokerage services whether they want them or not. These states are known as "minimum service law" states.

The Antitrust Division of the U.S. Dept. of Justice has come out strongly opposed to real estate "minimum service laws", as it's not in the best interest of consumers.

You can see if your state is a "minimum service law" state by going to the Antitrust Division page devoted to that here: https://www.justice.gov/atr/fee-service-brokerage-arrangements-0