Q: I’ve seen ads on TV with people advertising that they will pay me cash for my house with a quick closing and no commissions. Is this a good way to go for a quick sale?
A: Why would you want to limit yourself to just one buyer? I’m sure it sounds enticing not to pay any commissions, but what is the trade off? So, you save 5% to 6% in commissions, but what if you are selling your home for 10% or 25% (or more) below market value? These companies are not in business to pay market value for your home. They want to and need to pay wholesale prices in order to make money. Listing your home with a Realtor is going to expose your home to many potential buyers, often resulting in competing multiple offers. Why wouldn’t you want to sell your home at market value or above?
Real estate industry changes coming
Beginning Aug. 17, an MLS (Multiple Listing Service) participant (real estate agent / Realtor) “working with” a buyer will be required to enter into a written agreement with the buyer prior to touring a home, including both in-person and virtual tours. The mandatory provisions that the written buyer agreements must include are: specify and conspicuously disclose the amount or rate of any compensation the MLS participant will receive from any source or how this amount will be determined, the amount of compensation must be objectively ascertainable and may not be open-ended (not allowed: “buyer broker compensation shall be whatever amount the seller is offering to the buyer”), include a statement that MLS participants may not receive compensation from any source that exceeds the amount or rate agreed to with the buyer, disclose in conspicuous language that broker commissions are not set by law and are fully negotiable, and include any provisions required by law.
Bottom line for homebuyers: From now on, you will be required to sign a written agreement with your agent before touring any home. You do not need a written agreement if you are just speaking to an agent at an open house or asking them about their services. In a future column, I will cover what the new rules are for sellers.
Market update
June’s market update for Macomb County and Oakland County’s housing market (house and condo sales) is as follows: In Macomb County, the average sales price was up by more than 7% and in Oakland County, it was up by more than 5%. Macomb County’s on-market inventory was down by more than 12% and Oakland County’s on-market inventory was down by more than 8%. Macomb County’s average days on market was 24 days and Oakland County’s average days on market was 22 days. Closed sales in Macomb County were down by almost 22% and closed sales in Oakland County were down by more than 22%. The closed sales continue to be down as a direct result of the continued low inventory. Demand still remains high. (All comparisons are month to month, year to year.)
By the long-standing historical definition from the National Association of Realtors, which has been in existence since 1908, a buyer’s market is when there is a seven-month supply or more of inventory on the market. A balanced market between buyers and sellers is when there is a six-month supply of inventory. A seller’s market is when there is a five-month or less supply of inventory. Inventory has continued to stay low. In June, the state of Michigan inventory was stuck at 2.2 months of supply. Macomb County’s inventory was at 1.6 months of supply and Oakland County’s inventory was at 1.8 months. As you can see, by definition it is not a buyer’s market.
Steve Meyers is a real estate agent/Realtor at RE/MAX First in Shelby Twp. and is a member of the RE/MAX Hall of Fame. He can be contacted with questions at 586-997-5480 or Steve@MeyersRealtor.com You also can visit his website: AnswersToRealEstateQuestions.com.
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