All Forum Posts by: Jonathan Minerick

Yelp can be good to verify these flat fee companies, as the reviews are a little harder to "game". In general, here's the big things you want to look for in a 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. Make sure you are able to make changes to the listing after it has been posted for a nominal fee.

3. Photos on MLS.

Make sure you can upload at least a dozen photos. Some services offer a great price, but it's only for 1 photo - which is not useful for most properties.

4. Length of Listing.

Get at least a six month listing and be sure that there is no charge for cancellation.

5. Fine print.

You should never be required to use any closing service (e.g. escrow) provided by the flat fee service agent.

Ultimately, we've found that the three most important things when listing a home are 1) price, 2) pro photos, and 3) offering a fair buyer agent commission on the MLS (typically 2.5%).

@Max Spellman You can't avoid it in California - you need to have 2 years of full-time licensed salesperson experience to be able to apply for a broker license. 

For your father's sale, you can just get a flat fee MLS listing to get it on the MLS, which is a much cheaper and less time consuming way to go about it (for example, we do this for $95 in CA).

For the purchasing, you might want to find an investor friendly broker who can rebate a large portion of the commission earned - naturally, in that case, you'd be expected to do much more legwork yourself.

Here's a breakdown of the costs of being licensed in CA, just to give you an idea of what a headache/time sink it is: https://www.biggerpockets.com/blogs/9561/55035-what-are-the-costs-and-steps-to-a-california-real-estate-license

@Jay Hinrichs Yes, many of the items you brought up were addressed in the BP post I referenced and also in the costs blog I wrote. Please check out the articles if you find time.

@Account Closed I'm in the group where I do NOT believe a license is appropriate for most investors. Here's a BP post I did on the costs in California and another BP post which argues against getting a license.

What are the costs and steps to a California real estate license?

Don't get a real estate license

That is correct, Marian - while NAR statistics show that FSBO is at an all time low (which I believe), what they don't show is that many FSBOs have simply transitioned to using a flat fee listing, which is technically "For Sale By Agent".

@Scott Byer $500 seems to be a lot for a flat fee listing - we do these for $95 in California (just FYI, might want to price shop a bit).

I'm a big fan of using Yelp to verify these flat fee companies, as the reviews are a little harder to "game". In general, here's the big things you want to look for in a 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. Make sure you are able to make changes to the listing after it has been posted for a nominal fee.

3. Photos on MLS.

Make sure you can upload at least a dozen photos. Some services offer a great price, but it's only for 1 photo - which is not useful for most properties.

4. Length of Listing.

Get at least a six month listing and be sure that there is no charge for cancellation.

5. Fine print.

You should never be required to use any closing service (e.g. escrow) provided by the flat fee service agent. 

Ultimately, we've found that the three most important things when listing a home are 1) price, 2) pro photos, and 3) offering a fair buyer agent commission on the MLS (typically 2.5%).

@Engelo Rumora wrote a good BP post about this here: https://www.biggerpockets.com/renewsblog/2016/04/0...

I agree w/ him that a license is NOT appropriate or necessary for most real estate investors, mainly because it is cheaper, faster, and easier just to use flat fee services. 

Here’s a BP post I did that directly addresses the expenses of getting and holding a license in California: https://www.biggerpockets.com/blogs/9561/55035-what-are-the-costs-and-steps-to-a-california-real-estate-license

Yes, in my biased opinion, use a flat fee service to get you on the MLS. Your best bet is searching the web for "Flat Fee MLS + your city" and then checking the reviews on Yelp. So many of the reviews out there on other sites are borderline bogus or clearly written by the same person/company. It pays to be skeptical (IMO, Yelp is the most reliable).

The other important thing to note is that not all flat fee listings are the same. In general, here's the big things you want to look for in a 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. Make sure you are able to make changes to the listing after it has been posted for a nominal fee.

3. Photos on MLS.

Make sure you can upload at least a dozen photos. Some services offer a great price, but it's only for 1 photo - which is not useful for most properties.

4. Length of Listing.

Get at least a six month listing and be sure that there is no charge for cancellation.

5. Fine print.

You should never be required to use any closing service (e.g. escrow) provided by the flat fee service agent.

Also, always remember you can get a flat fee attorney to help you with the paperwork as well, so you don't necessary need (or want) the firm that did the MLS listing to also do your paperwork.

We've found that a home selling boils down to getting just three things right 1) get pro photos, 2) like @mike flora said, offering a fair buyer agent commission on the MLS (typically 2.5%), and 3) price it right, which you'll know once you list (lots of offers = too low, no offers = too high. Either way you can adjust accordingly).

@Jody Schnurrenberger The 98% vs 91% list to close price ratio, like all statistics, can be misleading. For example, lets say you have a home you want to sell for $500,000.

If Agent A convinces you to list the home at a lower price of $480,000, using the logic that a lower price will create a bidding war. The home then gets 5 offers on day 1 and you accept an offer for $490,000. In this case, the list to close price ratio of Agent A is higher.

If Agent B lets you list at the higher price of $500,000. You accept an offer 14 days later at $495,000. In this case, the list to close price ratio of Agent B is lower…. but you ultimately made more money by using Agent B.

In short, the statistic doesn’t necessarily say anything (and could be construed as good or bad).

@Lynette Braun Thanks, have a great week!

A lot of agents assemble a database (over time) of investors that are always looking. Most actively searching buyers are going to using an agent already, so posting on the MLS is going to take care of that.