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Tired of getting soaked by outrageous real estate commissions

Let’s face it, there is a ton of money in South Florida real estate. So far this year, over 3,250 properties have changed hands in the Northern Palm Beaches. The median single family home price today sits at $510,000. Here in Tequesta, it is $585,000. In our little village, the median days on market for sold single family homes so far this year is only 26 days. Over 26% of all single family home sales sold in a week or less. The median commission offered to the buyers broker sits at 2.5%.

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So, let’s take a look at that median sale price of $585,000 here in Tequesta, with that median days on market and that median co-broke commission of 2.5%. Assuming both brokers received the same compensation it would mean a total commission of $29,250. If the listing broker worked 8 hours a day, on nothing else but this listing for the 26 days on the market the seller paid their broker over $140 an hour. That equates to almost $300,000 for a full time job, selling one house at a time, with nothing else to do. It’s a lot of money and sellers should be asking a whole lot of questions, interviewing brokers, and finding one who will not only professionally market their home, but also charge them a fair fee for their services.

Selling a house in Florida is not an inexpensive proposition. If a seller pays a 6% commission on the median priced home in Tequesta and you add in the State of Florida Documentary stamps on the deed, the owner’s title insurance policy and a moderately priced firm to handle the title and closing work, their total closing costs will be over $37,000. Some brokers even charge additional transaction fees and many closing agents are not would I would call moderate. That’s a whole lot of money to sell a house and that’s on a median priced home. When you realize that 1 in 4 single family homes in Tequesta this year sold for over a million dollars and the median pricer of those home is $1,662,500, well you can image what their commissions and closing costs look like. They run right up into the 6 figures in a hurry.

Buyers are mistakenly informed they do not pay for real estate commissions. Maybe directly they are not responsible, but believe me, seller’s price commission expense into the equation and indirectly buyers are responsible. They too need to be informed, ask questions and interview brokers if they want proper representation.

There are more brokers out there than ever before, many have little experience, and you must be careful. Very careful. A new Realtor, in many instances does not have a clue why a buyer should understand that buying a frame constructed home may be a mistake, why that roof might cost them $25,000 next year, or why that great deal really isn’t one at all. All they have to do is buy a zip code from realtor.comzillow.comtrulia.comhomes.com or the hundreds of other websites out there. Just like that they will show up on your screen as the local expert. 

The downside to an inexperienced broker is even greater for a seller where many thousands of dollars are on the line besides those crazy expensive closing costs. Many brokers will give an inflated value of a home on a listing appointment to secure the listing. The reality is your home is worth exactly what a ready, willing and able buyer is willing to pay and the closer you list to that number the higher the odds of you getting what your home is worth. Testing the market makes sense at times but all homes, and sellers are different. 

Online price estimates are as bad as an unexperienced agent so be very careful about what you feel the value of your home may be. Zillow says our home is worth $657,580 while realtor.com says it is $588,900 and both estimates are far below reality. There are other homes were estimates are far above real world numbers. Sellers must ask questions and get informed to select a broker who is equipped to assist them in effectively meeting their goals.

If you are buying, or selling, real estate anywhere in the country please reach out to professional brokers, interview and ask a lot of questions. If you are in Palm Beach or Martin County please feel free to reach out to Paradise Sharks at 561.308.0175 or tom@paradisesharks.comParadise Sharks would love the opportunity to meet you and help you make an educated decision. We have been doing nothing but selling and building real estate for a career that has spanned many decades. Paradise Sharks give all of our buyers sizable credits at closing and our “let’s set a record price” marketing programs start as low as 4%. Paradise Sharks is in our 6th year and we are small on purpose. We have no franchise fees to pay, no broker taking a cut or our earnings and no middleman to raise the cost to our clients. We save our clients lots of money and if we do not do exactly as we insist they fire us. It’s simple. We are an open book and our goal is to provide you world class service and save you tons of money. Its just what we do.

 

Fins up……….

 

 

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