The house sold for $630K. The Listing commission was $875.00. That’s not right! Agent must have been a family member? Turns out the Agent was a girl in Colorado doing this, “real estate thing”, for a while to pay for weed and lift tickets? To her, real estate is nothing more than an online game that pays.
The lines of demarcation are getting fuzzier. Borders are falling. Down the hall is the same as across the Country. Local MLSs are on a path of losing their power to the national publishers. Big data has invaded. What’s going on?
Getting a real estate license is easy. Getting those license privileges extended in other States is also easy. Forms and payments. A hassle in paperwork for sure, but in the big picture, a very inexpensive proposition. What does this get an agent? It gives them permission to be absurd!
Want to list homes in East Cobb for $500? How about million dollar Buckhead listings for $800. That would be nuts—right? But don’t forget, you can’t regulate against stupid. And, to that point, stupid is subjective. If you can do a couple of hours of work online and get nearly $900 bucks, is that really being stupid?
How can this happen? This happens, in large part, because Atlanta has no barrier to entry. Remember 90% of the nation’s MLSs are owned by NAR. If I wanted to List my friend’s house in Chicago, in addition to all the forms and paperwork, I would have to join and pay dues to the local Illinois Board to get the house published on the Chicago MLS. A huge hassle and not practical.
The upfront cost to an out-of-State agent for getting a listing on FMLS? Zip! Take that back, the lowest cost available is $12.95 a month. Point is, it’s nominal. Agents across the nation are starting to realize they too can enter any non-NAR market with relative ease. Atlanta, being the largest non-NAR market in the U.S., it has become the easiest and most profitable to attack.
How does this happen? Getting on the local MLS is the key. Search “days on market”, DOM. Agents don’t have to know anything about a town or area, they just need to know where to find a low DOM. Homes within neighborhoods of consistently low DOM numbers will sell. Homeowners know they live in popular neighborhoods and see that as a way to save on costs. Low DOM tells us, people are “watching” this neighborhood. The Listing agent won’t have to do much. They don’t even have to put a sign in the yard. They can sell Atlanta luxury for a weekend on the slopes.
Is this good for the industry? No. Can anything be done about it? Again, no.
On the surface, the home seller “saved” thousands of dollars on commission. But did they really? Perhaps, but I contend not as much as you’d think. At least not to the amount that would cause a wave of out-state agents stealing listings. There will always be outliers. And, we may have more out-of-State agent listings than most, but I seriously doubt this goes mainstream.
It has been said, houses are a lot like children. Homeowners are the first to tell you their home is very unique and clearly the most special in the neighborhood. Nobody likes to think they live in; “average”. Never forget, home ownership equates to emotional investment. Out-of-State Listing agents, i-Buyers and big data solutions all require a certain amount of detachment from the transaction.
If a homeowner hasn’t lived at that address very long, or has developed no equity in the property, a detached approach may work. But, if a homeowner has ever smashed a toe, cut a finger, or lived with paint in their hair, all in the name of home improvement, you can pretty much forget about any detached capability.
Real estate can be very emotional. And, we LIKE it that way. Big data? Inhuman and depressing.
Buyer’s Agents; if your client is interested in a listing by an out-of-State discounter, it tells you a lot about what you are going to run up against. You can almost smell the detachment. Go in low!