I do believe Agents sell homes for more money than homes listed and sold via FSBO websites. However, I disagree with the study itself. It's a bit flawed. My conclusion comes from being a high volume broker. We see both sides by providing full service and MA Flat Fee MLS and NH Flat Fee MLS services. I would like to breakdown the three potential reasons this study came to this conclusion. While I agree with the overall findings, my reasons are different.
(Study Reasoning 1) Agents possess marketing expertise, including knowledge of how to stage a home and the best repairs to make, the study points out.
(My Reasoning 1) Agents understand how to market real estate because they do it full-time vs. sellers who do it once every 5 years. This is an important detail. However, most agents are terrible at marketing but this is just fine for the average home because MLS is the real reason. It's a powerful medium. We will touch on this in reasoning #2. NAR puts a lot into protecting their turf within Washington. While I don't agree with a lot of things they do, understand how to work Washington DC. They are always in the top lobbying spenders right behind the number 1 spender the US Chamber of Commerce. Last year NAR spent $20m while in previous years they have spent as much as $60m.
(Study Reasoning 2) MLS listings (vs homes listed on FSBO websites) are generally syndicated to broker websites, exposing the home to a “much larger buyer population.” Also, there's no direct correlation between a staged home and an unstaged home. The majority of homes are not staged at all. With regards to knowing which repairs to make. Very few sellers do full out repairs and getting sellers to do meaningful repairs is not always easy. Only some "repairs" make a difference. It's all about how well a home shows. The most important aspect is how well the agent can relate to the prospective buyer. There's a ton of psychology when selling real estate. It's up to the agent to know the psychology of real estate. This takes a good 10 years of selling to master the psychology of real estate.
(My Reasoning 2) I agree with this. FSBO site to syndicate listings to partner sites but the listings do not get preferential positioning if you compare the listings that come through agents. Agent listings are more powerful. I will go into this in more detail later.
(Study Reasoning 3) MLS listings may attract more showings (and bids) because they offer compensation to buyer’s brokers for bringing a buyer to a sale — whereas FSBO listings often do not.
(My Reasoning 3) I disagree with this reason. From my experience, FSBO's will compensate buyer's agents. Furthermore, compensation is not directly related to the amount of buyer's who come through the door. Once the listing is on MLS, extreme exposure is automatically granted. Listings get syndicated regardless of the commission offered. No ethical buyer's agent is going to restrict their buyer if the commission offering is below the average compensation for the area. It is against the rules and regulations of NAR for an agent to put their interests first. Compensation should not be a factor. Agents are required to show all properties to their client regardless of the amount of compensation being offered.
We provide flat fee MLS listing services in Massachusetts (MA) and New Hampshire (NH). Other services include MLS Entry Only.
