Broker vs FSBO

How can they be identical?

In the same line, perhaps. But still not identical.

The broker, all else being equal. Owners tend to have blinders on. E.g., this old favorite: http://streeteasy.com/nyc/sale/607620-condo-350-west-50th-street-clinton-new-york

On the other hand, here's a FSBO where the owner knew what she was doing: http://streeteasy.com/nyc/sale/628770-coop-320-west-end-avenue-upper-west-side-new-york

With no broker there's no third party mooching 6%. The owner may be willing to split the difference. Both parties win.
Of course you go with the owner.

whoever goes lower

Well assuming you mean identical as in also same price. In that case I would go with broker, as there is 3rd party to deal with and don't have to deal with emotionally invested seller who maybe doesn't know how to proceed. FSBO work if they give a reduction. In this case I would expect for them to price a bit lower, so basically you both benefit as Riversider suggests.

Wanderer is right and the question is idiotic. You deal with both, and you negotiate the best deal for yourself. The cost basis on the other side of the deal is irrelevant.

Set up the pole.
Start the music.

the one on the higher floor

If it were my fsbo, I'd go with the experienced buyer. A buyer who knows the process and can write a good offer, and has all their ducks in a row is always a pleasure. As buyer, you want a fsbo who has lots of experience. If the fsbo is not prepared to sell, the deal can be a nightmare. It cuts both ways -- if the apartments are identical, there should be no difference (or only very slight) in price. The fact that seller with broker has selling costs should have no bearing on the price. There is only one true price for an apartment on any given day -- the market will tell you when the pricing is spot-on. If seller has to hire someone to do this for them, it's not your problem as buyer. If you expect the fsbo to give you a better deal, you have the numbers inverted. Both apartments should sell at the market price. I don't believe any salesman can command "more" for an identical product. If a broker says, "I can get you 7% more than a fsbo", you are being fed bullshit.

PS - if you do some research -- you will discover a few transactions where similar apartments in same bldg sold within weeks of each other, one fsbo, the other full service... you will be surprised to see the closing prices were incredibly close. The market doesn't lie.

the one who's realistic.

Here's an FSBO where the owner wasted a few months before going with a broker: http://streeteasy.com/nyc/sale/663706-coop-11-riverside-drive-upper-west-side-new-york

11/28/2011 Previously Listed by Owner at $510,000.
02/11/2012 Owner Listing is no longer available.
02/17/2012 Listed by Halstead Property at $495,000.
03/26/2012 Listing entered contract.
06/06/2012 Sale recorded for $480,000.

In the owner's listing, note the "$510K FIRM!" that the broker (who knows the building inside-out) must've told him he was unlikely to get. The broker priced it properly and sold it in five weeks.

$510,000. What a great way to make sure buyers looking for apartments up to $500,000 don't see your listing.

NWT
about 1 hour ago
Here's an FSBO where the owner wasted a few months before going with a broker: http://streeteasy.com/nyc/sale/663706-coop-11-riverside-drive-upper-west-side-new-york

11/28/2011 Previously Listed by Owner at $510,000.
02/11/2012 Owner Listing is no longer available.
02/17/2012 Listed by Halstead Property at $495,000.
03/26/2012 Listing entered contract.
06/06/2012 Sale recorded for $480,000.

In the owner's listing, note the "$510K FIRM!" that the broker (who knows the building inside-out) must've told him he was unlikely to get. The broker priced it properly and sold it in five weeks.

This is how these things go 95% of the time.

"Price will increase in a few weeks if I have to hire a broker but currently available for $510,000 (FIRM!)"

Classic, owner ended up at $450K instead after paying said brokers.

>"Price will increase in a few weeks if I have to hire a broker but currently available for $510,000 (FIRM!)"

Excellent strategy.

Brokers only seek to maximize their own profit, not act as agent for the seller or buyer.

One of these feeble-minded dimwits told me I was pricing my apt too high. I had taken the last 6 months comps for all the sales in my building (about 40), knocked out the studio and 2 bedrooms because they're overpriced outliers, taken the average $/sq ft, and priced it at the 30 percentile (less). When I showed her my spreadsheet, she said my apt wasn't comparable. To the same ones in the same building? Mine having a nice view and balcony? Get out of my house.

JWL2672
about 3 hours ago
Posts: 63
Member since: Mar 2012
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Brokers only seek to maximize their own profit, not act as agent for the seller or buyer.

One of these feeble-minded dimwits told me I was pricing my apt too high. I had taken the last 6 months comps for all the sales in my building (about 40), knocked out the studio and 2 bedrooms because they're overpriced outliers, taken the average $/sq ft, and priced it at the 30 percentile (less). When I showed her my spreadsheet, she said my apt wasn't comparable. To the same ones in the same building? Mine having a nice view and balcony? Get out of my house

In other words they wanted to price it to market, and you wanted a price that was too high.

A broker any day of the week unless you feel like arguing for a year that the owner's counter-depth refrigerator, while lovely, does not justify a 25% premium to building comps.

in regards to that example above, i think had he priced it at $465k as fsbo he'd sell it right away (assuming he pays 3% to buyer's broker so same as w/ full broker 480k). he'd probably have sold it at 480k as fsbo as well. moral of the story is brokers can help fools price their apts right but if you can price it right and have some time on your hands, you're better off w/out one.

In NYC, people don't cook, they order in, or they eat out...they don't do laundry they send out dry cleaning, AND people don't sell their own homes, they hire a broker. Welcome to NYC. If you don't like it move back to Ohio or Florida you skinny jean, blazer wearing, fake new yorker hipster.

always use a good broker

I thought JButton was more of a Brooks Bros. type.

angeloz, sorry to burst your bubble but people sell their own apts ALL THE TIME. People, do not listen to broker psycho-babble. In New York City, APTS can sell themselves if you use your brain.

angeloz what group of clients do you serve? straight out of college yorkville? plenty of us have nice kitchens and cook, and plenty of us have washers/dryers in our apt and so can do our own laundry.

We create unneeded tension by trying to argue that there is one way or a best way to do something. The great thing is there are options for sellers and buyers. I would say for the majority of New Yorker's I meet and know they simply don't have the time or desire to sell their own apartment. But I also personally know a few who have taken on the task, one recently was successful, they had a small apartment on a very desirable street in the West Village. But it can also be a very taxing endeavor.

We don't list apartments, but similarly with buyers, some want to go it alone, some want hand holding from the start. We found a niche in offering buyers who would not traditionally engage a buy-side broker and created a model suited for their style. There are also a few good companies offering similar services to sellers who want a sort of hybrid experience.

In most cases it can be very difficult and time consuming trying to market and sell your own apartment, I think potential sellers should know that. You have to be very smart about how you proceed with your sale in a world where future buyers will see a clear historic digital trail of your apartments life.

Keith Burkhardt
The Burkhardt Group