Discount Real Estate Brokers: Consider the Pros and Cons

Before hiring discount real estate brokers to sell your house or to find you a great but affordable home, consider the advantages and disadvantages of hiring them instead of getting a full-service real estate broker.

If your area is currently a seller’s market, hiring a discount property broker to sell your house may be a good decision because you will not need lots of creative advertising and marketing and access to major Multiple Listing Services to be able to sell your home. You can therefore limit the types of services you want from the broker, you can reduce the rate of commission and you can get more from the sale of your house.

But if your area is currently a buyer’s market – when there are a lot of attractive and affordable houses available in the market, you need more than what a discount real estate broker can offer. You need better advertising and marketing strategies and you need access to major real estate listings to be able to sell your home.

There may be discount brokers promising full services while accepting lower commission rates, but past experiences show that not all promises are fulfilled. After all, businesses need money to run and need to cut costs if cash inflow is reduced.

Remember also that it may take time for discount real estate brokers to sell your home if they are not able to share commission rates with other agents. Some do not share, unlike many full-service brokers, because of the reduced commission or reduced fee agreement.

For prospective buyers planning to hire discount brokers, make sure you hire someone who tells you in advance what documents you need to produce and who explains to you the home buying process, including the title search, the title insurance and the rest of the closing process.

Remember also that some real estate agents or some multiple listing services do not accept listings from discount brokers, so this fact lessens the chances for your property to get sold. Boycotting a listing is illegal, but sometimes there are ways agents can go around the law.

But do not be discouraged if you are bent on hiring a discount broker because you have the ability to do some of the steps in selling your home. With a lot of conveniences offered by communication technology and the Internet, hiring discount real estate brokers is a good strategy to cut selling or buying costs.