Thursday, January 30, 2014

I am thinking about listing my home and a friend referred me to an broker who provides limited services. What does this mean?

Hi Jennifer,

Great question.

There are some brokers that provide "limited services" for buyers and sellers of real estate. If you include the phrase “limited representation” in this description you would have a clearer picture of what they are offering.

From my experience they usually offer a seller to list the home in a locale MLS and maybe put a sign in the year. The seller is responsible for making appointments, following up on agent visits, any interaction with interested parties and all marketing and advertising expenses. In some cases they will receive an offer but consulting on the offer is an additional charge from their “services menu”.

Most of these “limited services” brokerages will offer all of the additional services from a “services menu”.These services are on a fee basis(A la caret). $$ for sign, $$ for asking agents what they thought about your property, $$ for negotiating contracts etc. There may be some advice given when an offer is received but typically the seller is relying on his or her knowledge about the real estate market to make decisions.

For this limited service they will charge you less than what a full service brokerage would charge you to list the home. Full service brokers on the other hand become your partner in the process. Running interference with buyers agents and their clients by gathering answers to questions that they know will be asked beforehand, marketing and advertising costs are paid by the agent/broker, getting the best possible exposure for your property, advising on strategies, pricing and timing of market conditions, advising on what needs to be done to get a home ready for market, doing analysis of the market so you can be competitive when you list, handling all of the paperwork that will be needed for a successful transaction. There is much more that each individual agent brings to your table that is not on a Service menu basis but part of the obligation that the real estate agent has with their client.

For buyers similar limited representation, they may get notified of listings in the area they are interested in but when it comes time for making appointments with listing agents or sellers it is all up to the buyer. They will produce an offer for the buyer at the time the buyer identifies a home they are interested in and in a lot of cases prepare offers for homes they have not even visited. I once had an out of town buyer contact me to see a home my broker had listed because his agent said if they were only in town to look at homes he did not have time to show them properties, just let him know when they found something they liked and he would write an offer!!

Everyone is entitled to their own opinion on this type of service. I had a client once mention after talking to a limited service company it felt like having to go to court with out your lawyer!

In either buyer or seller case it depends on how comfortable the client is with dealing with the whole process by themselves. Sometime the opposing agents get a little frustrated by doing the work of 2 agents but having to pay the other agent a commission for less than full service. For the full service areal estate agent at the end of the day it only matters if their clients interests are best served so you do what you have to for your client.

I would strongly suggest you meet with a full service brokerage in your community and compare the level of services and dedication you may find with a full service brokerage. Keep in mind it takes a lot of the stress off of you during the selling process when you have someone working side by side with you instead of being available just a FEE away!

Good luck in your listing. Please feel free to contact me for Full brokerage services if in the Austin, TX area or if you need a referral for anywhere else in the world!

Kind Regards,

Bob Kenney, Realtor®

Reilly Realtors

Mobile/Text: 512-922-4922

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