Discount brokers: Getting what
you pay for?
Sandra and Milton Logan couldn't bear the thought
of once again paying a real estate agent a 6-percent commission.
So when the couple put their Reno, Nev., home on the market in 2004,
they chose to work with a reduced-commission brokerage, Reno-based
Assist-2-Sell charged the Logans $4,995 to sell their
home. For this fee, the company provided the Logans a real estate
agent who did nearly everything a traditional agent would do: He
placed advertisements in local newspapers promoting the home, stuck
a "For Sale" sign in the Logan's front yard, scheduled
showings, negotiated a final sales price, and handled the reams
of paperwork that go into selling a home.
What didn't he do? He didn't list the Logan's home
on the Multiple Listing Service, or MLS, the online database of
homes for sale through licensed real estate agents. He did that
so Assist-2-Sell would not have to share the commission with another
agency. At the same time, the house is exposed to far fewer potential
buyers and may take longer to sell. But in many of today's hot real
estate markets, that's not a factor.
The Logans sold their home for $322,500 a little more
than three months after they first placed it on the market. If they
had paid a standard 6-percent commission, the couple would have
spent $19,350, so they saved $14,355. Not surprisingly, the Logans,
who put much of their savings into the new home they purchased in
nearby Sparks, Nev., are thrilled.
had been using the same Realtor in Reno for a lot of years. But working with him
took such a big chunk out of our equity every time we sold. We saved a lot of
money by going this route," Sandra Logan said. "I knew that Assist-2-Sell
had good exposure around here, so we weren't worried that our house would sit
on the market too long. Our agent with Assist-2-Sell did a great job."
The Logans aren't the only sellers who have balked
at paying agents the traditional 6 percent of their home's sale
price as a commission, and Assist-2-Sell is far from the only reduced-commission
brokerage that has risen up to serve such clients. Companies such
ZipRealty and Help-U-Sell
each offer their own versions of discount service. Some, like Assist-2-Sell,
charge a flat fee based on the sale price of a home. Assist-2-Sell's
most popular program charges sellers $2,995 for homes that sell
for as much as $200,000 and an additional $1,000 for each $100,000
increase in sales price. Others, such as Foxtons, charge a reduced
commission. Foxtons charges sellers a commission of 2 percent of
the final sales price, while ZipRealty agents charge a commission
that is 1 percent lower than the standard commission in a given