4% Broker Fees

I agree that the 6% should be lowered, but if you go with your plan, you end up doing all the work because you have to act as seller's agent when a broker brings you a buyer. Meaning you deal with all open houses, advertising/pictures, communications with propective buyer's/their agents, dealing with your condo/co-op board to process the buyer's applications, etc. The buyer's brokers actually get a better deal with your plan, because they do no work and get 4% instead of half of 6%, if you had a seller's broker. If you are doing all the work, you should save at least half of the 6% in my book. Brokers will never take your 4% offer for them to do the work, because they will possibly only end up with half of that anyway unless they bring the buyer.

Agree w/ starfish. A broker bringing buyers isn't expecting more than 3%. I've seen FSBO sellers w/ ads that say something like "Brokers with buyers welcome. I will honor 3% commission." I've actually seen 2.5% offered, as well.

Very good idea (assuming you're willing to do the leg-work (run the open houses etc...)--which I would since all that is certainly worth at least 2% of my apt's value).

I'd be interested in hearing from folks who've had success selling as FSBO in Manhattan....everyone I know who has tried it eventually gave-up...

I think all agents expect is the prevailing fee for that type of apartment, and the good ones won't skip showing if it's half a point off.

At this point, the usual suspects offering 4% are new condos -- I think Platinum still is -- but I wouldn't expect it for a resale.

I would expect decent pricing, though. Every FSBO I've ever seen if too high by at least $25K. If you can offer 3% and price chop by 1%, I think you'll get more traffic than if you offer 4%.

ali r.
{downtown broker}

Front Porch (Ali r.) ...every broker apartment is priced too high as well, so I do not get your point

All I am trying to do is point out ways to break the 6% monopoly...if every broker grew to expect 4% for FSBO, that part of the market would grow and the 6% co-broke would shrink and over time the entire market would just move to a 4% brokers fee

It is silly that people will drive 30 minutes to save 25 cents a gallon on gas or go from store to store to save 20 cents on bananas, but do not fight back on savings that could buy them a new car

Apt_Boy

There are places in America that do run on 4% brokers' fees -- but discount brokerage has generally not been a successful business model in New York City area -- look at the Foxton's bankruptcy.

What comes to mind is Lockhart Steele's quote that there will always be brokers in New York because it's a city where people pay to get their laundry done. In theory, if consumers would live with 4% quality of service they could pay 4% fees, but with the perils of co-op boards and sometimes lousy and late new construction, NYC consumers are generally demanding a higher level of service than that.

My industry ain't perfect, but living without us is generally even worse. A cautionary tale came up just today on these boards, where a buyer who sounds like he/she is not using a broker just found out his Eighth Avenue apartment appraised for nearly 10% less than contract price.

ali r.
{downtown broker}

If you are willing to pay 4%, why don't you just find a broker willing to accept 5%. Your listing will be on the MLS system (Manhattan equivalent), seen by all, and a lot less headaches for you. You will probably get a better selling price than you FSBO with broker.

front_porch: Wasn't Foxton's driven into bankruptcy b/c the real estate industry banded-togehter and denied them access to MLS? I think there is an anti-trust investigation underway as we speak about this very issue. The industry pulled the same thing on RedFin. Brokerage is a scam "profession" long over-due for a spanking.

I feel like being an as*hole

Ok Apt_Boy, I want to take advice from a guy who doesn't know the difference between the words hire and higher.

So to "save" 2%, you end up doing all of the work and getting all of the distrubution.

And your $1MM apartment (I'm giving you benefit of the doubt), the 2% you save is ... ... ... ...
twenty thousand dollars. You've got time for that? Good for you.

front_porch, I thought your advice on the "Do all the major brokers still charge 6%?" thread was very good. I also think that a GOOD broker, who really puts his/her client's interests first may have helped in the case you cited above. However, I've often had the feeling (as have others on the board) that many buy-side brokers would rather just get the buyer to up his/her bid to both seal the deal/make the seller happy and, of course, earn a higher commission. In effect, causing those problems that a good broker would help avoid and costing the buyer money. I'm sure you're well aware, but the bad apples in your profession are ruining its reputation for the good ones (though I must say, I think the good ones are in the minority).

qwerty--

IMHO, Foxtons was actually driven into bankruptcy because their website didn't work, so their sellers got no exposure there, and they weren't spending the extra ad dollars to get them exposure elsewhere.

Which raises the point, when you sell an apartment, talk to the listing broker about what advertising they're prepared to buy you.

tenemental, thatnks for your kind words. The "good" agents in my industry (and I strive hard to be one)want to give our clients the same service we would give our family, because it's easier to service a repeat client than to go out and capture a new one. But I realize not everybody is in it for the long haul.

ali r.
{downtown broker}

Apt_boy we sold our apartment ourselves FSBO. We took some great pictures, scanned in a floorplan and advertised on the NYTimes. We sold the place at marketprice in about 3 months.