I think realtors are a great resource in this field. They are knowledgeable and just because they might sell a home for $ 200,000 and we will often think, “wow she showed one home to that person and made a cool 6% profit which means she’s taking home $ 12,207.00 for one showing. Keep in mind that the realtor has to split that fee with another realtor if it was their listing. It’s no longer the days where you list a home and only that realtor can show it. Your listing shows up on MLS and anyone can choose any realtor they want. If the listing agent happens to be the one who sells the home they don’t split their commission with anyone but understand their company gets a portion of that $ 12,000 and they are generally not considered an employee under federal tax guidelines so they have various different taxes to pay from their commission so the next time you think an agent made a ton of money; think again. They may have shown that one client 20 different properties. That’s a lot of their personal time in hot weather, snow storms and long drives only to have their client find 10,000 things wrong with that showing.
Now getting back to whether I would use a realtor when selling a home of mine; now that’s kind of a different story. I really adore the realtor that sold me this home and I met her from her selling my other home to her client so naturally I called her when I wanted to see a few homes. When I sold my other home, I used a company called US Realty. It’s a realtor’s nightmare because they earn less commission. I use this site because there is no way you can get your home listed on the MLS (multiple listing service) without listing with a realtor. This company online does it for a fee of $ 296.00 for a 6 month listing. You do have to be a little savvy on the internet because you are responsible for your listing, photos and other things. And don’t expect to get a hold of the listing agent. You can only speak with him via email and he has X amount of time to respond. If you feel the need to call him …trust me, DON’T as your credit card will be billed $ 50 for a phone call. My sister and I started calling him “Ghost”. I kind of like it this way as I used a different realtor from a different agency when I bought my first REO and her pictures she took, she may as well turned all the lights off and taken them in the dark that is how bad they were. By the time I realized it, these horrendous photos crept like a spider on a hungry day through the entire www. Realtor. com, homes.com, trulia.com, and a dozen other sights not to mention the web-site of every realtor that has a web-site. I ended up calling her and telling her to remove all my pictures and I retook them, but it took a few days for the new ones to get out there. When using US Realty, you do get to be in charge of your listing and I like that. It allows you to choose your own commission for a realtor who shows your home. If you find the buyer, there is no commission. Last time I chose only 2.5 percent so Megan sold it and only got half of that as my listing agency US Realty got the the other half. I don’t even think she made anything or not much because the girl who bought it ran low on funds and I had to come down a lot more than I wanted and she gave up some of her commission so this time I’ll use US Realty but will advertise on my own on social media and Craig’s List and if you sell it yourself there’s no commission. So lets just throw out a number for the halibut. If I list it for $ 99,900 and a realtor sells it for 90,000 that means they would split the 3 percent commission (or whatever amount I choose when setting my U
S Realty up) with US Realty so they would make 1.5 percent which would be $ 1,350.00. Now if that was the only home they showed to their perspective buyer and spent a few hours with them…that’s a decent profit after whatever fees they owe but generally that is not the case. Because flipping houses is risky, I feel more comfortable listing in this manner as the home goes everywhere due to MLS and I can help protect my bottom line.
One of my first homes I bought in Greenville I listed with a realtor that turned out to be a pretty nice acquaintance of mine. I listed it on Craig’s List before I listed with her and I ended up selling it. I gave her $ 1,500 at the closing and she told me that I didn’t owe her anything because I sold it. She trudged up there on more than one snow storm, set up an open house and did a lot for me so I could not pretend like she didn’t do anything. Realtors are hard-working individuals but like police officer, teacher and other workers there are some stinkers in that group and I ran into one during this process but luckily my realtor who sold me the home took care of her.
So having said the above, selling a home for $ 100,000 on US Realty would save you over $ 3,000 if you chose 3 percent as your selling commission. A lot of people don’t realize that if it’s your choice to flip your home quickly and sell it rather than rent it out then all your profit is counted as ordinary income and you are taxed at 15.3% for SE Income so depending on what tax bracket your other income is in you could theoretically profit $ 40,000 from a sale in 6 weeks and owe Uncle Sam (IRS) upwards of $ 20,000. If I don’t find a reputable renter within a reasonable time-frame that could happen to me. So using those figures, out of the $ 40,000 profit I could make, $ 3,000 would go to commissions, $ 20,000 to IRS and maybe $ 800 in closing costs and buyers are notorious for not saving any of their closing so will commonly request some kind of sellers assistance which could be 3 or 4 thousand dollars so now all of a sudden you went from $ 40,000 to $ 15,200 profit which is a nice chunk of change but keep in mind you risk your money so it’s always best to rent them out if you can find a good renter. There is only so long you can hold out for that renter because each month it’s causing you a loss.
So wrapping up here on this subject and if you are in the market for a home and want to hire a realtor to show you homes, by all means call Megan Martini and she will get the job done and some!