60 Minutes: Redfin Saves $27,000 vs FranklyRealty.com Client Saves $152,000!

tag:blogger.com,1999:blog-4797432599663441966.post-6849106359349208052007-05-24T00:32:00.001-04:002008-02-22T12:33:37.072-05:002008-02-22T12:33:37.072-05:0060 Minutes: Redfin Saves $27,000 vs FranklyRealty.com Client Saves $152,000!<img src="http://s68.photobucket.com/albums/i18/franklyfrank1/th_1c523ee2.jpg" alt="" align="left" height="142" width="142" />Last week 3 people texted me (or would that be "text me") <img src="http://s68.photobucket.com/albums/i18/franklyfrank1/th_818a21a2.jpg" alt="" align="right" height="114" width="91" />saying "Turn on 60 minutes," yet I missed it! (<a target="ssw" href="http://tinyurl.com/252tpt">see it</a>) America was lured in by the... 20 year long regurgitated story "Attack on the 6% Realtors" and comments about "saving thousands."<a onblur="try {parent.deselectBloggerImageGracefully();} catch(e) {}" href="http://s68.photobucket.com/albums/i18/franklyfrank1/th_bcc7c749.jpg"><img style="margin: 0pt 0pt 10px 10px; float: right; cursor: pointer; width: 94px; height: 94px;" src="http://s68.photobucket.com/albums/i18/franklyfrank1/th_bcc7c749.jpg" alt="" border="0" /></a> After watching such a biased infomercial, of course <a target=new href="http://redfin.com" ref="nofollow">Redfin</a> seems like a no-brainer. Well my blog readers have a brain, so here it goes... Sidenote: Normally I'm not a fan of NAR, but I did agree with most of their comebacks (<a style="border-bottom-style: groove;" href="http://www.realtor.org/about_nar/NARRespondsToSixtyMinutes.html" target="_blank">click to see</a>). I have written extensively on my bias opinion on the pros and cons of rebating and discounting including: <ul><li>For Buyers: <a href="http://franklyrealty.blogspot.com/2007/02/realtor-rebates-free-money-or-expensive.html">Realtor Rebates. Free Money or Expensive Savings?</a></li><li>For Sellers: <a href="http://franklyrealty.blogspot.com/2007/04/virginia-mls-flat-fee-fsbo-save-20000.html">Go FSBO! Save $20,000! Realtor Tells All!!</a></li></ul> I would like to focus on the "savings" comment put forth by 60 Minutes' case study. "WE SAVED $27,000"* NOTE THE ASTERISK!<img src="http://s68.photobucket.com/albums/i18/franklyfrank1/th_9acdfa47.jpg" align="right" />After they were done laughing and giggling on their couch about how they saved $27,000 and how they could spend it on their wedding, they made an under-the-breathe comment that they sold their place for..."$10,000 under what Redfin recommended that we list it for." In this comment I see two things to question:1) "$10,000 Under List"2) "The list price recommended by Redfin."<img src="http://s68.photobucket.com/albums/i18/franklyfrank1/th_abd661b4.jpg" alt="" align="left" height="130" width="91" />So let's start with the latter...<img src="http://s68.photobucket.com/albums/i18/franklyfrank1/th_503be3e7.gif" alt="" align="right" height="136" width="160" /> If some of their agents do as many as 8 closings a week, might it be remotely possible that they might have a strategy of listing low in order to sell fast? I'm not saying they do, but would that make sense to anybody besides me? And for the "$10,000 under list," while I oftentimes say that "Many Listing Agents Suck" <a target="sess" href="http://realtytimes.com/rtapages/20070329_bloggerrant.htm">See RealtyTimes article </a> or <a style="border-bottom-style: groove;" target="ss" href="http://franklyrealty.blogspot.com/2007/01/for-realtors-sucky-listing-agents-i.html">my blog</a>, one has to wonder if another motivated agent that had more time to devote to the listing might have:<ol><li>Landed them full list ($10,000 higher)</li><li>Started higher and ended higher ($15,000+ higher)</li><li>Got a bidding war going, resulting in a much higher net ($32,000 like our Realtor Megan's listing, see <a href="http://franklyrealty.blogspot.com/2007/04/test.html" target="_blank">blog</a>). </li></ol>In my biased opinion, the best way to get the most for the house isn't to find one buyer, but to find at least TWO buyers. I don't believe in pricing low to start a bidding war, but I do believe in getting as many buyers into the process as possible. A process that can take an extra 8 hours in one day for one agent, while netting the client another $32,000.Back to the "$27,000 total in savings," that was for buying and selling. If we assume that they bought a bigger place, they probably "saved" $12,000 on the listing and "saved" $15,000 on the purchase. I'm confident, and I have references to back me on this, that I can consistently do at least $12,000 higher than a discount agent. I wish there was a way to prove this with statistics, but they would just be manipulated. Instead I can only give real world examples:<ol><li>Megan, with <a href="http://franklyrealty.com/">FranklyRealty.com</a>, had a recent listing (See<a href="http://franklyrealty.blogspot.com/2007/04/test.html"> Bidding Wars? It's The Staging Stupid!)</a> The initial discussion regarding the starting price at the listing appointment was roughly $550,000 (seller's opinion). After staging, light remodeling and further research, and many hours of work, the starting price was set aggressively at $570,000. The end result was 3 offers and a ratified contract $13,000 higher. While I'm confident in these number being an example of hard work, Redfin might also find an example of an agent that did a similar great job. And if that person was so great... I would hire them and pay them double, because they are worth it. (think about that for a second, if you could offer value way beyond discounting, wouldn't you start charging accordingly?)Sidenote: ZipRealty, another discount firm (some disagree with that term, see blog comments/debate), according to one blog is full of disgruntled, newer, and underpaid agents that are overworked. External blog: <a style="font-style: italic;" href="http://www.bloodhoundrealty.com/BloodhoundBlog/?p=1086" target="_blank">What's Wrong with zipRealty</a> </li><li><a href="http://www.bloodhoundrealty.com/BloodhoundBlog/?p=1086" target="_blank"></a>FranklyRealty.com Saves Client $152,000 should be the next 60 minutes update. </li></ol> <img src="http://i68.photobucket.com/albums/i18/franklyfrank1/87f1d012.jpg" alt="" />The above is actually a true story. It was a hot seller's market, and with proper marketing and about 10 stressful non-stop hours the $499,000 listing was bid up to $601,000. One thing is to bid it up, another is to actually close at this price. Especially after several attempts to renegotiate, and appraisal issues. Yeah sure, I got a few bucks for the incremental difference, but that is nothing compared to the unexpected $102,000 in their pockets. Sure they could have "saved" and sold it fast FSBO, but they wouldn't have been able to get anything near what I got them (their words). Then on their purchase, they loved a house that was getting 8 offers. At FranklyRealty.com we don't write normal looking offers, and that sets us apart immediately<img src="http://s68.photobucket.com/albums/i18/franklyfrank1/th_9a9764c0.jpg" align="right" />. Each offer is different. I can't publish all my tricks here, but when was the last time that you saw a contract that put the Realtor's ENTIRE commission on the line as a promise that we wouldn't renegotiate the offer? That is powerful. Also we run a CRA (tm) Comparative Realtor Analysis report (<a href="http://realtytimes.com/rtapages/20070329_bloggerrant.htm" target="_blank">see it here on RealtyTimes.com</a>) amongst many other systems that net our client more. A good agent should approach buying a house like an acquisition of a company. Thus winning contracts for less. In this case the 8 offers were bid up to approximately $800,000. Why in the world would somebody take our lower offer? Well because money is not the only motivating factor. When we got that house for only $750,000 my clients were in shock after just getting approved by the lender to get bid up to $800,000. They saved $50,000.<img src="http://s68.photobucket.com/albums/i18/franklyfrank1/th_69e05cc7.jpg" alt="" align="right" height="110" width="110" /> So it doesn't matter if the market is hot, cold or you are buying or selling, an aggressive agent can save you much more, and do it in a way that all parties are smiling in the end. Ok, I got sidetracked. The point is that what a great agent does can't be compressed into 8 closings a week per agent. So you have to pick one:<ol><li> "save on commission" or </li><li>"net more."</li></ol>Bottom line is, I used to rebate... but then I got... good. Frank Borges LL0SA- Virginia Broker/ Owner <a href="http://franklyrealty.com/" rel="nofollow" target="_blank">FranklyRealty.com</a> <a style="border-bottom-style: groove;" href="http://blog.franklyrealty.com/" rel="nofollow" target="_blank">Blog.FranklyRealty.com</a> Featured in BusinessWeek, CNBC, WSJ etc. <img src="http://franklyrealty.com/logos/Logo-07-Inch-GIF-2k.gif" alt="" />Don't miss another blog, get it via email. Sign up now (spam-free) on the right side of the page. Videos at <a style="border-bottom-style: groove;" target="new" href="http://youtube.franklyrealty.com/">YouTube.FranklyRealty.com</a> Keywords: Housing bubble? Arlington, Alexandria, mls, homes, Real estate, Virginia, Alexandria, 22201, 22314, Fairfax Va, DC Realty, Realtor<div class="blogger-post-footer">.::. Don't forget to come back to the site to post comments. A blog without reader interaction is a boring blog. Also go and see the comments and debates. .::.</div>FRANK LL0SA Va Broker- BLOG.FranklyRealty.comhttp://www.blogger.com/profile/12647085935682292923noreply@blogger.com27