Hi Gary. I need every dollar I can get when I sell my condo next month. I interviewed a discount broker and he says he does just what a regular broker does. But I didnt get a good feeling talking with him. Something made me uneasy and I dont totally believe him. Do you think hes being truthful about what he does?
***ANSWER:
No.
In MY experience, discount brokers dont do what a good, experienced, full-service broker does. Of course, Im sure there are exceptions. I just havent seen any.
Running a real estate business is just way too expensive when done right and doesn’t allow for proper service at cut rates. Heck, just my advertising bill is over $10,000 per MONTH! You cant lose money selling each home and make it up on volume.
(By the way, in my opinion, calling them “discount brokers” is like calling Yugo a “discount carmaker”. Yugo was just a “cheap” carmaker.)
For years, while telling the public they do all the seller’s important work, behind the scenes such brokers often dumped much of it on the buyer’s broker. This was a major disincentive for full-service brokers to sell their homes. (Would you do 50% more work w/o extra pay?)
So starting 2004, the MLS requires listings by many discount brokers to be flagged as “Limited Service”.
In summary, let’s do the math.
“Save” 1%. But if due to less marketing, less service, less skill, less negotiation, and less interest from other brokers, you get 3% less on your price, whos saving money?
Are you better off with a Limited Service or discount broker?
Draw your own conclusions…
