With the advent of third party aggregators using Realtor listings to populate their site, and the advent of an overwhelming majority of home buyers beginning their search online, many questions have risen regarding the legality and/or ethics of how listings are posted.
Real estate industry insiders have opined in the past against agent listings appearing alongside FSBO listings, while others (especially non practicing agents) have pointed out that it is consumer advocacy to show all data possible.
But forget about all that for a second and tell us what you think by taking this poll. Results will be posted in the coming days.
CC Licensed image courtesy of cocoen via Flickr.com.
Nadina Cole-Potter
July 9, 2010 at 9:07 pm
Somebody enlighten me, please. I only pay attention out of the corner of my eye and ear because it is residential and I restrict myself to commercial. I have watched the expansion of the number of web sites the listings of the residential agents in my company (Keller Williams) will be automatically posted to in addition to being posted in the agent’s personalized KW web site. And I think there is a for-pay listing web site that receives the listings after they are posted to the MLS. So, are you saying that these listings reside with FSBOs on the same web site (or that FSBOs will come up in a search along with listed properties)? And how is this a bad thing?
I see Realtor advantages: 1) Leads to turn into listings (although if the FSBOs are investors used to turning their own properties, probably not a good lead); 2) Better property descriptions written by Realtors (although with Gwen Banta’s examples, perhaps not); 3) Better pictures, 360 degree tours, more pictures; 4) Better response time from a Realtor — a FSBO still in the work force returns inquiries after dinner and on the weekend — if they don’t go away for the weekend; 5) Knowledge of how to move the deal forward — to written form. The AZ Assoc of Realtors’ forms are no longer printed or sold in hard copy. They are only available through our Zip Forms subscription which comes with our AAR membership. What is a onesie FSBO to do (the investors will have their own forms — g-d help the buyer)?; 6) Knowledge of how to handle the inspection period, other contingencies, deadlines, and closing — and the correct forms; 7) Handling the security and safety of the property and the owner — not admitting just anyone who says they want to have a look around.
Are FSBOs still telling Realtors who want to list their properties that there was this guy yesterday who said he wanted to buy the property and they were going to wait a couple of days to see what he does before thinking about listing?
A NAR slogan should be: “Even dentists don’t perform their own root canals; why are you selling your house without a Realtor?”
Happy weekend and happy selling, everyone!
Fred Romano
July 9, 2010 at 10:21 pm
Nadina, you NEED to be enlightened! If you seriously think people can’t sell without a Realtor you are just plain wrong. And your analogy about dentists is just dumb, because if they “physically could” do it themselves, I am sure they would. But of course it’s not possible since you can’t drill while being doped up!
Selling one’s home on their own is quite simple, given the seller has the right mentality (think like a sales person), the right tools (MLS access), prices the home right for the current market (keep it real!), and uses legal counsel with real estate experience. It’s not rocket science, and you don’t need a college degree or a Realtor.
Many savvy sellers are using flat fee listing services, like ours, to take advantage of the worldwide marketing exposure facilitated by posting their home “by owner” on the MLS. I don’t know if you realize this – but sellers (in most states) don’t need to hire a “full service” broker to get on the MLS. They can easily pay a small fee, list in a day, and get under deposit in 7-10 days. I know – we have had clients that have done it.
Benn Rosales
July 10, 2010 at 12:11 am
Do you list your sold percentages on your site, Fred? Total properties listed versus Solds versus withdrawn- that type of thing for your consumer? I thought you did, but I can’t find it?
Fred Romano
July 10, 2010 at 2:26 pm
No Benn, I do not list those stats on my site – never have.
Nadina Cole-Potter
July 10, 2010 at 2:08 pm
“Dumb”? Fred, I wouldn’t go there if I were you.
“But of course it’s not possible since you can’t drill while being doped up!” My point exactly!
Our MLS does not take FSBO listings and I hope it never does. No wonder the survey asked if we thought the Realtor brand was being diluted! Does the FSBO lister then have access to the MLS to find his/her replacement property? Any MLS linked with a Realtor board that is linked with the NAR and that accepts FSBO listings is diminishing its service to its paid members who are locked-in to joining. I would be organizing colleagues to attend the MLS board meetings and protest mightily.
I understand the gov’t’s position against locking out limited service brokerages but I do not think that any settlements or case law require MLSs to accept FSBO listings. Talk about acting counter to one’s own interests! Now that is dumb!
Fred Romano
July 10, 2010 at 2:41 pm
Nadina – I never said FSBO’s were listing themselves on the MLS. I am not even sure if I understand the reason for this AG poll. I said that they can get their home listed using a flat fee listing service like ours. They represent themselves throughout the transaction, and our only responsibility is to make sure the listing is updated.
I had a client 2 months about with a very expensive home close… She saved nearly $60,000 using our service.
Some states have tried to “lock out” the discount brokers by passing laws which require brokers to perform “minimum” services. This is wrong in my opinion for 2 main reasons. 1) the consumers choice is now limited and they are forced to pay for services they do not want or need 2) the brokers are forced to perform services their client does not want or need.
You can find out more about this on the DOJ website. There are a handfull of states. I hope the DOJ pushes these states to change their laws. Everyone deserves choices.
And I still think your dentist analogy is dumb. You are not seeing my point – IF they COULD, they WOULD. Sellers CAN, so they DO!
What state are you in? I bet there are flat fee brokers in your state posting listings on your MLS – so YES there would be listings that are “by owner” on your MLS.
Nadina Cole-Potter
July 10, 2010 at 3:19 pm
My understanding is that if a broker takes a flat fee, regardless of the limited services provided, that is technically a listing, not a FSBO. The Agent Note may say, “Contact owner” for a showing. Or there may be a disclosure of limited service (which translates that the Buyer’s agent is going to have to do all the paper work).
As an agent, I have never understood the limited service business model although I think my brokerage allows it — with a lot of written disclosures (expectations) from the agent and sign-offs by the “client”.
Frankly, just from a risk-management basis, and with all the inventory on the market, I can’t see why a Buyer’s agent would want to be involved with such a deal. As we all have pointed out in another post today, both Buyers and Sellers are not necessarily rational beings and to have a professional on the other side of the table as a reality check, if nothing else, is helpful.
When we (both my husband and I were licensed at the time) sold our residential investment properties, we responded to buyers’ sign calls by asking if they had an agent. If they didn’t (and were not experienced investors), we always recommended that they get one and would recommend someone not even affiliated with our brokerage as the buyer’s agent and took no referral fee. We were happy to pay a co-broke just to keep the transaction sane and on track — and, of course, to make sure there was no chance we could be accused of unfair dealing.
I don’t have any statistics but I see limited service as a risk management nightmare waiting to happen.
Fred Romano
July 10, 2010 at 3:28 pm
Why would you think there is any more liability with these listings vs. others? You are working for the buyer right? Then you should not be advising the seller. period. If you do, then yes you would be opening up yourself for additional liability. But only a foolish agent would do that right?
Our listing contract is very specific:
“Owner agrees to waive the following services which are typically provided by a broker; (a) Scheduling property showings on behalf of Owner, (b) Receiving offers and counter offers and forwarding them promptly to the Owner, (c) Answering any questions that the Owner may have in negotiation of a successful purchase agreement within the scope of the licensee’s expertise, (d) Advising the Owner as to whatever forms, procedures and steps are needed after execution of the purchase agreement for a successful closing of the transaction. Upon waiver of the above duties, the Owner is advised that they may not expect or seek assistance from any other licensees (such as buyer’s broker) for the performance of the above duties listed.”
As you can see we are covered. There is actually LESS liability on the listing side based on our listing agreement, and since the owners are providing all the info required by the MLS.
Dunes
July 10, 2010 at 4:19 pm
“Do you list your sold percentages on your site, Fred? Total properties listed versus Solds versus withdrawn- that type of thing for your consumer?”
Do any Realtors do that on their Site…for the consumer?
Just Curious
Fred Romano
July 10, 2010 at 5:25 pm
Thanks Dunes – I don’t think many do. I have never seen that.
Benn Rosales
July 10, 2010 at 6:10 pm
Fred doesn’t operate as a Realtor, he operates as a media site. Bulk listings for so-called FSBOs who actually are listed by a Realtor. Most serious listing agents do boast their time on market, or time to first offer, hell Russell Shaw does it on the radio. I’m merely looking for some data points that show that people are selling their own real estate in mass or in minority based on this: “Many savvy sellers are using flat fee listing services, like ours, to take advantage of the worldwide marketing exposure facilitated by posting their home “by owner” on the MLS. I don’t know if you realize this – but sellers (in most states) don’t need to hire a “full service” broker to get on the MLS. They can easily pay a small fee, list in a day, and get under deposit in 7-10 days. I know – we have had clients that have done it.”
So the next logical question (based on that assertion) would be the ratios. What does “many” look like? They’re using the services, but are they being successful? 7-10 days? What percentage?
Benn Rosales
July 10, 2010 at 6:12 pm
PS and what percentage of that is actually due to the fact that they’re featured on RDC?
Dunes
July 10, 2010 at 8:53 pm
Who has defined that “Fred doesn’t operate as a Realtor”?
Who defined FSBOs that use a Flat-fee to get on the MLS or Realtor.com as
“Nope not an FSBO”?
IMO that definition has more to do with 1. Justifying there presence on the MLS and Realtor.com
2. NARs …Only x% of people go FSBO or only X% of FSBO are successful statistics that Realtors toss around…
I remember the First time I saw Fred post over a year ago at Trulia and he used the words Flat-Fee…Realtors created Profiles just to jump in and throw out insults…state Fred was obviously desperate, a sell-out, a lesser skilled Agent, a Scam artist ect….
A good number of those same Agents now daily offer flat-fee Services, discounts, rebates, we list FSBOs…anything to get clients/leads…I’ll be glad to post their names
“Most serious listing agents do boast their time on market, or time to first offer” does not equal..
“Do you list your sold percentages on your site, Fred? Total properties listed versus Solds versus withdrawn- that type of thing for your consumer?”
One is a claim or as you put it “Boast” the other is “sold percentages on your site” and “Total properties listed versus Solds versus withdrawn” posted on a your Site..
Are there examples of many Realtors doing that?…posting sold % on their site or Total listing vs Listings sold vs withdrawn or even properties listed and relisted and relisted
BTW..Will ya be asking Agents like Russell Shaw to verify their claims or “Boast” or they don’t need to because they are not Flat-Fee…they are “Serious Listing Agents”
Fred Romano
July 10, 2010 at 10:29 pm
I am sure everyone would love to see my numbers so they can twist and tear them apart, then manipulate and use them in their “sales pitch”. Sorry folks – it’s not happening here. You also must keep in mind that we work listing homes on high volume (5-10 per week) and because we are not involved, have no control over the outcome of the transaction.
We also contend with agents constantly pressuring our clients to list with them, which is not something most “full service” agents deal with. Because of this, we sometimes have clients cancel and list with one of them. It’s sad that it happens, but there is nothing I can do to stop these unethical agents. They will lie and say just about anything (I have heard some stories) to take one of our listings.
I love what I do, and take great pride in the service I offer. I truly believe I am the best flat fee broker in Connecticut. And if you ask any of my clients (even the ones that have canceled) they will tell you about our awesome customer service.
Bottom line is sellers need choices – they demand options, and not all of them want or need a “full service” agent. We simply offer the alternative solution. I am still a broker, Realtor, and business owner – just like all the rest of you. I just do it differently.
FSBO’s on the MLS? Not really… Just listed with one of us 😉
LesleyLambert
July 12, 2010 at 1:13 pm
Interesting that you don’t want to post your stats to have them twisted.
Mike
July 11, 2010 at 10:49 pm
Fred, I have no beef with what you do, but you use the term “unethical agents”, and unless you sell your service disclosing the VERY poor closing percentage of the vast volume that you market, then isn’t that shady, if not unethical? Your business would evaporate if you told these people the truth. VERY few FSBO’s sell, and there is a reason. If they do, many are a royal pain, the seller may lose money, and they open themselves up to legal liability. Very few succeed.
You are not a Realtor, or a Broker unless you are handling the transaction, at least to the degree that the “limited service” brokers are doing it. Correct me if I’m wrong, but all you do is set up the actual listing, and make price adjustments and such, as the seller instructs? (Which is probably well worth the $300 or so that you charge.)
It’s a cop out to call yourself a Real Estate professional, and then say, “I don’t handle the transaction, so it’s not my fault that they don’t succeed.” Again, I don’t have a problem with your model, but it is what it is.
You said that a recent seller “saved” $60,000. How so? You mean that they didn’t pay a commission. How do we know that, that property could not have received a much higher sales price if it were marketed to a MUCH larger buyer pool, and was negotiated by a competent listing agent? The truth is, you don’t know how much, if any, was “saved”.
Hey did you hear? Obama “saved” 100,000 jobs last month. Never mind that the US lost 200,000 jobs. Numbers can be twisted, and the truth can be easily over looked.
The truth is, home owners CAN sell their own homes. The MAJORITY don’t, and there are reasons why. having typed all of that, I honestly have no problem with your model.
-Mike O’Hara
Fred Romano
July 12, 2010 at 12:08 pm
Mike you are not worth my time.
Mike
July 12, 2010 at 1:10 pm
Gee Fred, I thought that I was quite professional. You just admitted that you are a COWARD! Wow.
Mike O’Hara
Fred Romano
July 12, 2010 at 5:18 pm
Removed for violation of TOS
Benn Rosales
July 12, 2010 at 5:17 pm
I’m still stuck back on twisted statistics. If they were in fact real data points that back up the claim that there is a growing majority being successful, I would think that would be good news we could all get behind. Folks have been playing the disruptive card for over 5 years now, I think that’s long enough that we should be able to compare notes.