| An “In
House” listing means your home is not offered through
the Multiple Listing Service (MLS) to all cooperating brokers.
Therefore, many of the potential buyers will never know about
it.
MLS is one of the most powerful tools we have as real estate
brokers to market your home and bring it to the attention
of most prospective buyers. When all prospective buyers
know about your property, you have the best chance of getting
the best possible price and terms. Any ethical broker will
advise a seller of the advantages of putting a listing for
sale onto the MLS immediately upon listing the property.
If ever you encounter a broker suggesting to keep it “in
house,” even for a few days, a red flag should go
up. Here’s why:
When a broker sells a property they have listed, they receive
the full commission instead of sharing it with another firm.
There’s nothing wrong in that if they’ve marketed
it in a way designed to get you the best price and terms.
After all, that’s the reason you’re agreeing
to pay them a commission, they should earn it.
Keeping a listing in house can benefit the broker, almost
always at the seller’s expense. Here’s why:
Any listing that’s not on MLS is known only to a small
fraction of potential buyers. I believe no single office
in Ulster County has more than 10% of the market. So an
in house listing is seen by only a small fraction of possible
buyers. If a buyer can be found from among that small segment,
it is highly probable that another buyer, willing to pay
more, often far more, could be found from among the entire
set of buyers available through MLS.
We have seen time and again properties being sold before
going to the MLS. Some of these seemed clearly under priced
and we believed could have sold for much more given a little
time on MLS. If that is true, it is likely those sellers
were cheated out of a fair price for their home, while the
brokerage firm doubled it’s profit. Is this an incentive
for an unethical broker to underprice a property so they
can quickly sell it in house?
Any broker, including us, has sometimes priced a property
below what some buyer in the marketplace at that time was
willing to pay, but a savvy broker can avoid harm to their
client by making use of the auction process. So called “under-pricing”
a home does not need to harm a seller if the marketing is
handled properly. For more information on this important
subject, see the article entitled “The Realtor’s
Job: Understanding the Auction Process.”
Andrew Peck
Top of Page
Back
to Our 2004 Real Estate Guide for Sellers
|
