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Debunking the 5 Myths of Flat Fee Real Estate

Written by Posted On Wednesday, 06 April 2016 09:03
Debunking the 5 Myths of Flat Fee Real Estate iStock

Think you know flat fee real estate? Here's the real scoop!

What is flat fee real estate? Simply put, you pay a flat fee instead of a commission (typically 3%) to list your home. As you do your research on flat fee real estate, you might have some questions based on some common misconceptions. Let’s check the facts and dispel 5 myths of flat fee real restate:

MYTH 1: You get what you pay for  FALSE. That might be true for cars or computers, but it doesn’t necessarily apply to flat fee real estate. Some companies charge a flat fee to put your house on the Multiple Listing Service (MLS) and leave it up to you to market your property and do the paperwork (aka“Flat Fee MLS”), but that’s not the same as a true flat fee real estate brokerage. If you choose a flat fee brokerage that offers full service, you’ll get an agent supported by a full team of real estate and marketing professionals. Streamlined processes and professional contract negotiators utilized by the flat fee, full service model results in, on average, homes sold faster and for more money. You’re actually getting more than you pay for!MYTH 2: Buyers agents avoid flat fee listings  FALSE. Why would they? Although the listing is a flat fee, the buyer’s agent still receives their commission. This flat fee, full service model makes your property attractive to the entire real estate market. Avoid companies that have flat fees for both the seller’s and buyer’s agent – that’s what keeps agents (and their buyers) away.

MYTH 3: Flat fee real estate is basically the same as FSBO  FALSE. Like Flat Fee MLS, FSBO (For Sale By Owner) leaves the seller completely unrepresented. FSBO is a step down from the already limited Flat Fee MLS model, because the seller pays for their house to be on the MLS (Multiple Listing Service) but it’s not included in any other search engines. With flat fee, full service real estate, sellers get full representation from start to finish. This includes listing in the MLS and beyond.

MYTH 4: Representation is limited because you don’t have an agent the whole time  FALSE. The key to a successful flat fee real estate model is to let agents do what they do best. If you went to the dentist, how would you react if he was the receptionist, biller, marketer, hygienist and doc at the same time? You’d probably think he couldn’t possibly do all those jobs well (and you’re paying a lot more for a doctor to do them). With a flat-fee, full service brokerage, the agent is complemented by a team of real estate professionals who specialize in technology, contracts, negotiation and more.

A real Redefy flat fee real estate listing
A recent Redefy flat fee listing

MYTH 5: Flat fee is only useful for those with little or no equity  FALSE. This couldn’t be farther from the truth. With a traditional brokerage model, the more your home is worth, the more you pay in commission. Let’s look at a home worth $400,000. The traditional brokerage listing commission is typically 3%; that’s $12,000 you’re paying. By using a flat fee, full service company, you would save $9,500. That’s a lot of equity you could keep for yourself!

For a more detailed explanation of the difference between the Redefy flat fee model and Flat Fee MLS, check out our article Flat Fee Real Estate vs. Flat Fee MLS.

Redefy is a flat fee, full service real estate company listing homes just $2500.* We’re changing the way homes are sold! Let us help you sell your home and save money!

*$2500 for homes under $1 million; 1% for homes $1million and over. Broker co-op may apply.

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Redefy RE

Redefy is a full-service real estate brokerage committed to returning value to customers through superior service and flat fee listings. Redefy Real Estate was named a finalist for the 2015 Most Innovative Real Estate Company of the Year award by Inman, the industry’s leading source of real estate information. For additional information about Redefy, visit redefy.com.

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