How would a Rhode Island seller benefit from a flat fee MLS service?

A flat fee MLS service might be the right choice for you if:

• You’re looking to save on the cost of a real estate commission. Home sellers who hire a listing agent typically pay a 5% to 6% real estate commission, which is split between the listing agent and the buyer’s agent. A listing service can help you eliminate the cost of a listing agent (2.5% to 3%). Instead, you’ll pay a flat fee, depending on the company and level of service you choose. But, you’ll still pay the buyer’s commission in addition to the cost of any other services you use to help you sell your home.
• You have a desirable home, and it’s a hot market. A desirable home in a hot market may sell itself. Listing your home in the MLS may bring multiple buyers and competitive offers your way. However, you’ll still be responsible for all aspects of your home sale.
• You want to be very involved in your home sale. If you have previous home selling experience, and you’re craving a challenge, you may want to take full control of your home sale. A FSBO sale may be your chance to shine. A flat fee MLS is the first step in your home-selling journey.
• You don’t want to work with a licensed agent. Not all agents are the same. That said, for whatever reason you choose not to work with an agent, a flat fee MLS company allows you to forgo the services of a licensed agent and still get your home listed on the MLS.
• You have the time and energy to invest in the home-selling process. Depending on the level of service you purchase from a flat fee company, you may need to take on various tasks normally handled by a real estate agent.

It should be noted, however, that on March 15, 2024, the National Association of Realtors (NAR) announced a landmark lawsuit settlement that will change the way real estate agent commissions are handled in the future. These changes will “decouple” seller and buyer agent compensation. Industry experts predict that this decoupling will likely lower agent fees and give buyers the ability to negotiate commission amounts directly. Learn more.

When selling FSBO, even with a flat fee listing service, you’ll typically need the time, energy, and know-how to:

1. Use market data to set the best selling price for your home.
2. Write a listing description that appeals to buyers and their agents.
3. Take professional photos of your property.
4. Market and advertise your home.
5. Make the state and federal required disclosures.
6. Coordinate showings and open houses.
7. Review offers and make counteroffers.
8. Negotiate the sales price.
9. Understand and negotiate the terms of your contract.
10. Calculate your closing costs and your net proceeds.
11. Handle any issues that may come up with the appraisal or inspection.
12. Handle any local real estate transfer taxes.
13. Get the required documentation together.

Pros and cons of using a flat fee MLS listing service

Pros:

• Eliminate the listing agent commission (typically 2.5% to 3%).
• Represent yourself in your home sale.
• Control all aspects of the sale from start to finish.
• Pay known costs for the listing service upfront.
• Get your home listed on the MLS and third-party websites.
• Helps expand your exposure to traditional buyers and their agents.

Cons:

• You’re still required to offer a commission to the buyer’s agent.
• You’ll be responsible for handling any issues that may delay or kill the deal.
• It’s a self-serve process that you’ll manage without the guidance of a local expert.
• You may be exposing yourself to liability claims and other legal risks.
• Your house will likely sell for less than it would with a traditional real estate professional.

How do I list my home with a flat fee MLS service?

Once you’ve decided to list your home with a flat fee listing service, you’ll follow these steps to get your FSBO home on the MLS:

1. Vet the flat fee MLS service. Research the local service you want, including packages and rates. Look up Google reviews and check out the company on the Better Business Bureau. Before you proceed, know how much information you’ll be able to list, how many photos you can post, what forms are available free of charge, and what add-ons come at an additional charge.
2. Register and select a plan. Register on the flat fee MLS company website, select the package you want, and pay the upfront fee online.
3. Enter your property information. Describe your property and upload photos. If your service offers it, fill out the disclosure form.
4. Read and sign your listing agreement. Sign the listing agreement. Be sure to read your listing agreement thoroughly to ensure you can cancel without penalty and won’t owe a listing commission.
5. Review your live listing. Once you complete your listing, the listing company will publish it to the local MLS, which means it will be visible to buyers’ agents. Depending on the company you choose, it will most likely be posted on real estate websites such as Zillow, Trulia, and Realtor.com. However, it can take a couple of days or longer to populate. It’s a good idea to review how your listing is displaying on real estate sites to be certain it’s correct and complete.

Are flat fee MLS listings effective in Rhode Island?

All homebuyers use the Internet when searching for a new home, and with few exceptions, these online tools rely on local MLS databases to populate the most up-to-date listings. Buyers’ agents rely on MLS data as well, making it one of the most effective marketing opportunities for sellers.

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Alternatives to flat fee MLS services in Rhode Island:

If you’re not sure a flat fee MLS service will fit your selling situation, here are some other options worth exploring:

1. Flat fee agent. A flat fee real estate agent offers to list and sell your home and provides limited services for a flat rate rather than a percentage of the home sale. The average flat fee can range from $3,000 to $5,000 but some may charge for additional services. A flat fee agent might be a good option for a homeowner who wants more control of their home sale but needs the guidance of a professional. Read your listing contract carefully to find out exactly what services a flat fee agent provides and if there are any additional fees.
2. Discount brokers. You can seek out the services of a low-commission or discount real estate broker. These companies or agents are typically more expensive than flat-fee MLS services. However, they will accept a reduced commission and often still provide some of the basic services and support you might receive from a full-commission agent. With a discount broker, you will still be on the hook for the full buyer’s agent commission.
3. Full-service, experienced real estate agent. List with a top-performing local real estate agent, who will provide dedicated full services in addition to listing your home. An experienced local agent will know local market trends, be able to leverage local connections with contractors and sales contacts, and have the proven skills to sell a home faster with the best results.

Will I save money with a flat fee MLS listing service?

Though you will save money on the commission fees, you may lose out in the long run. National Association of Realtors research shows that FSBO homes sold for around 23% less than homes sold by an agent. The median selling price for an FSBO was just over $300,000, while the median sale price of homes sold by an agent was just over $400,000.

So, while a flat fee MLS can be an effective tool, it’s important to remember that selling your home FSBO could result in less overall profit once it is said and done.

What if I need to sell my Rhode Island home fast?

If you need to sell your home quickly, you have options. Consider working with a We Buy Houses company or an iBuyer. These companies will purchase your home in almost any condition, often in days. Be prepared to lose money, though, as they will typically pay less than if you sold your home on the open market. However, when time is of the essence, these can be a good option.

HomeLight also offers Simple Sale, which can expedite the process or connect you with a local agent to give you some more options.

What else should I know about selling a house in Rhode Island?

While there are no strict rules for using flat fee MLS listing services, sellers must comply with local disclosure laws. Although not mandatory, hiring a real estate attorney is advisable for FSBO sellers to manage the complexities of disclosures and contracts, avoiding costly legal issues post-sale.

Key points to remember:

• Flat-fee services are paid upfront, regardless of whether the house sells, unlike traditional agents, whose fees are contingent on the sale.
• Some services may change names frequently, complicating the tracking of their success rate.
• Often, these services include the seller’s contact info directly in the listing, shifting more communication responsibilities to the seller.
• There may not be a dedicated individual to assist sellers through the listing service, a stark contrast to traditional agents.
• While flat fee services charge a fixed rate, traditional agent fees can be negotiated.

Ready to sell your Rhode Island home?

Selling a house is akin to taking on another full-time job. With a traditional real estate agent, sellers gain a knowledgeable partner focused on selling their property. Conversely, FSBO sellers must tackle many responsibilities typically handled by an agent. This can be daunting, especially for those with existing full-time commitments and limited knowledge of the real estate process.

Utilizing a flat-fee MLS listing service can ease some of these challenges, as the service offers varying levels of support depending on the package chosen.

HomeLight can connect you with a local agent in your area to help you manage the process and ensure a successful sale.

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