Forsalebyowner.com Founder Uses RE Broker...

Interesting Article in the Montreal Gazette. ForSalebyOwner.com founder used a broker to sell his Manhattan apartment. More detailed story in the Wall Street Journal.
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August 09 2011 - US
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Did you see that? Unbelievable, the founder of For Sale By Owner can't sell his house that way and uses a professional who actually winds up getting him more money. Good link.
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August 09 2011
Just goes to show... you get what you pay for.
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August 09 2011
Profile picture for SoCal Engr
I found this comment in the Montreal article to be pretty interesting...

Sambrotto apparently said he was unable to sell his pad because: "The apartment market in Manhattan was tightly controlled by agents."

As for...

"...and uses a professional who actually winds up getting him more money."

I failed to see this in either article. What's the attribution for this interesting piece of information?
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August 09 2011
Sambrotto apparently said he was unable to sell his pad because: "The apartment market in Manhattan was tightly controlled by agents."

I interpret this as: using agents is the best way to sell apartments in Manhattan because it is too difficult to get into the market "by owner".
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August 09 2011
"a standard 6% commission."

I would like to point out that there is no standard commission rate, by Federal law (Sherman Antitrust). Although a brokerage can set it's own standard commission rate, commissions in general are set by what the market will bear, and are generally negotiable. If this guy was a better negotiator, maybe he would a) have been able to negotiate a lower commission or b) sell his own home by himself.

Just a thought.
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August 09 2011
Profile picture for SoCal Engr
I interpret this as: using agents is the best way to sell apartments in Manhattan because it is too difficult to get into the market "by owner".

LOL. I interpret that as "really good spin". At least it's easier to believe than "...actually winds up getting him more money." (Understanding that, technically, anything is more money than "no sale").
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August 09 2011
SoCal_Engr:

"...and uses a professional who actually winds up getting him more money."

I failed to see this in either article. What's the attribution for this interesting piece of information?"

WSJ:

"The broker, Jesse Buckler, said he told Mr. Sambrotto the apartment in the Lion's Head building on West 19th Street near Sixth Avenue was priced too low and wasn't drawing the right buyers.

By May, it went into contract, he said, after attracting multiple offers. It closed in the last few days for $150,000 more than the original asking price."

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August 09 2011
Profile picture for Dunes....
More Money?

(According to News)

Original asking Price 2 Million...

Paid 6% Commission to Agency..Property sold for 2.15 million

6% Commission/Cost for selling 2.15 Million home?

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August 09 2011
Profile picture for SoCal Engr
Ah, the WSJ article. Would that have been in the part I have to open a subscription to read?
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August 09 2011
Profile picture for Michael Helton

The facts on this case are misrepresented.

Sure, the guy looks like a tool. 

But saying he made more money with an agent than without is speculation.  In the article it says the agent lowered the price; therefore receiving more offers.  If the dude would have just lowered the price himself, he may have received the same offer himself...minus the 6% commission on a $2Mil sale.

Besides, Manhattan is hardly representative of the US RE market. 

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August 09 2011
Profile picture for Michael Helton
I just read a different article that said the price was raised. bah.  

Have to give major credit to the networking/marketing savvy of that agent.  He earned he money.

It didn't help that some idiot had more money than common sense and overpaid by hundreds of thousands of dollars.  Whoever his buyer's agent was should be smacked, since if he would have just checked the FSBO site he would have saved his client a lot of money.
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August 09 2011
Nothing like standing behind a concept you believe in.
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August 09 2011

Providing a service to others for a fee is smart business. The owners of ForSaleByOwner.com recognize a niche for their business...

But offering a service to others is far different than offering to oneself...a surgeon would never operate on himself/herself...in this case, the providers of ForSaleByOwner.com were smart to recognize that representing oneself in a real estate transaction is not always the best policy. As a 20 year veteran of real estate, I can attest that good systems backed by good service do have a real, measurable financial upside to clients. The people I work with recognize that we are worth our fee because of the service we provide. Yes, they can list on that website, but they don't...

Kudos to ForSaleByOwner.com for recognizing the value of professionals in professional services!!

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August 09 2011
Profile picture for SoCal Engr
But offering a service to others is far different than offering to oneself...a surgeon would never operate on himself/herself...in this case, the providers of ForSaleByOwner.com were smart to recognize that representing oneself in a real estate transaction is not always the best policy.

First, enough with the REA-doctor/REA-lawyer/REA-etc. comparisons. The analogy breaks down very quickly, there's really no direct comparison, and it makes the REA profession look desperate for validation.

Second, did you even read the linked article. He tried for 6 months on his own, but then gave up because he felt that the local market was dominated by REAs and locked out FSBOs. Making comments like you just did makes a thinking person wonder if they want you reading and trying to advise them on their contracts.
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August 09 2011
Of course I read the article (and the more detailed article printed elsewhere) and I know the backstory...

Whatever your take on my analogy, the fact still remains that he enlisted a real estate professional to assist him in successfully selling his property...

Fact is, brokerage is an art and a science...If a homeowner wants to go FSBO, I strongly  encourage it. Statistically, most FSBO's will list their property with an agent because the process of pricing, packaging, marketing, negotiating and closing a deal is great deal more complex and time consuming and nuanced than most people realize. From my personal experience, FSBO's make great clients because after their "solo" effort, they tend to appreciate what I do for them as a professional real estate broker.
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August 09 2011
Profile picture for Michael Helton
In my personal experience selling FSBO is the smarter financial move.  Selling homes is a science?  Come on Bryan, that is an untenable position.  I will concede that it is an art...as are all sales positions.

Oh, and since you played the statistics card, here is a study showing that FSBO's in one area make more money for the seller than an agent does.  Study

Are any of the agents who posted here willing to comment about the fact that the buyer in this case (who was represented by an agent) overpaid on the property by hundreds of thousands of dollars?  Where was the science for him/her?
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August 10 2011
 
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