As seller agents, we work following the same process as traditional seller agents, except we charge $3,000 plus 3% of the sale price at closing. That $3,000 is our commission. The 3% commission is paid to the buyer's agent. Comparatively, traditional seller agents normally charge 6% of the sale price as commission at closing, which is split between the seller's agent and the buyer's agent.
We believe that people should pay only for the services they receive – no more, no less. We designed our system carefully, based entirely on this philosophy. Our fee is calculated based on the average time spent to close a transaction. Those with houses valued higher than $100,000 would benefit best from our pricing model.
The major benefit of using our services is that the seller can save big on commission. The average home price in the Woodlands is ~$400,000. A traditional 3% seller agent commission is $12,000, but our commission cost is only $3,000. That is $9,000 in savings! Also, if for any reason our clients are not satisfied, they are free to use another agent after notifying us, and we will terminate the contract. Our clients will never face the dilemma of being stuck with a particular agent.
It's important to note that selling a house normally involves three types of costs: commission to the seller's agent, commission to the buyer's agent, and other closing costs (title insurance, unpaid tax, etc.). The seller normally pays the buyer agent's commission and some other closing costs. Our pricing model saves on the seller agent commission. Seller still needs to pay the buyer agent commission and some other closing costs.
Overall, there are three types of seller agents in the market. The most common are agents who charge commission based on a percentage of the sale price paid on closing. That commission percentage is normally 6%. In some cases, seller agents may charge percentages as low as 4%, which is very rare.
Second, there are the so-called flat-fee agents. They normally charge a few hundred dollars upfront for listing fees. Flat-fee agent services are normally very limited because their main focus is simply listing your property. Many won't even list your property on MLS, the dominant marketing channel.
We represent the third type of seller agent – we provide full services and charge a flat commission fee at closing.
The following is a typical process for our sellers: