Idaho Falls Real Estate Blog

So you’re ready to list your Idaho Falls home for sale, but like most people, you’re interested in saving money. Often times sellers will look at listing their house with a discount broker that offers services for a lower price. When you’re selling a home, that can potentially mean a savings of thousands of dollars. But, are those savings really worth it? When you list your home with an Idaho Falls discount broker, what are you really getting? Like most things in life, you get what you pay for.

When my wife and I first decided to move to Idaho Falls many years ago, I was just like a few of you. I looked at what many of the real estate agents were charging, and I didn’t understand what I was really getting for the money. I decided that the best route for me was to save some money by listing my house with a discount broker. I bought into the idea that I was getting everything I needed, and I was saving thousands of dollars at the same time. Although I wasn’t a realtor then, I did have a real estate background and was confident that I was getting a great deal.

It didn’t take long before the romance wore off. I soon realized that my agent didn’t care about my house or me. He had me under a six-month contract with very few promises. Looking back, I’m convinced now that he felt his job was done once he listed my home. He was going to wait for me to sell it, and then collect a check for the work I did.

Six months went by without us ever getting an offer. The one interested buyer we had disappeared when we told their agent we weren’t offering him a full commission. To be honest, the entire six months was a nightmare that I’m glad I’ll never have to repeat. Once the dust settled and we were done with our contract, I realized I had just paid interest on my mortgage six more times. The total was more than what I would have paid if I had hired a realtor from a full-service brokerage right from the start.

The problem now, I still had my house to sell. I was certain that I couldn’t afford to try and save again, so I bit the bullet and found someone who I knew would get the job done. The sign went up in the yard, and the house was sold within three weeks. To top it off, we got about eight percent more for our house than any other comparable in our neighborhood. However, I still cringe at the thought of how much money I lost by using that discount broker.

Now that I’m a realtor I have a better understanding of how some of the discount brokers work. Do they save some people money? Absolutely! Do they cost some people money? Absolutely! Is it a mistake to list your home with one? No, as long as you are fully aware of what you’re getting, and can live with the results. In the next few paragraphs I’m going to tell you what no one else will.

Discount brokers generally make money by listing numerous homes and scrimping on the advertising, marketing, and personal service. The little advertising they use is designed to generate phone calls from potential buyers who are looking for a home. The important thing for you to understand is, if the discount broker can show and sell a home listed by a full-service broker, they will receive a higher commission than if they sell yours. That’s right, they may have little to no motivation to try and get your house sold. Although it’s extremely unethical, and potentially illegal to steer people away from your house, not every agent in this business is completely honest. They may think it’s in their best interest financially to hang on to your listing as long as possible in order to produce multiple buyers for other homes.

In addition, why would a buyer’s agent want to show your home to a potential buyer? Quite often the way a discount broker is able to charge less is by offering either no commission, or a discounted commission, to the buyers agent. Again, it’s extremely unethical, and potentially illegal, but a buyer’s agent may feel it’s better for them if they push a little harder to sell a different home listed by a full-service broker rather than yours.

So, the discounted listing agent you hired might not be working for you, and the buyer’s agents might not want to show your house. Who then is working for you? Are you really saving money?