If you start to Google “discount real estate broker/agent” (or some variance of this phrase) you’ll likely get so many hits you won’t know where to start. There’s no real definition of a discount agent, there’s terminology that’s inconsistent, and those that advertise this service vary greatly in what they offer.
So, what really is a discount agent and what can you expect from their service(s)?
By definition, a discount is a ‘deduction from the usual cost of something’. It’s a break from the normal cost / going rate of something. In real estate, there are ways to get discounts, as well as brokers/agents that offer a discount service as a business model. Some examples include:
Agent’s that offer a listing discount as part of a step-up/move-up discount. If you sell your home with that agent and use them to purchase a new home, they’ll often discount their list fee. Instead of charging a typical list fee of 3%, they may discount that to 2% or 1.5% and “make up for it” with the commission on the purchase.
There are also agents that may give a discount on listing commissions if they’ve done repeated business with a client, group, or employer. Some large employers have real estate benefits for their employees, like USAA, who offer discounted rates/benefits while using their preferred agency.
There are also discount brokers/agencies – their business model is built around being a discount shop. They may make an offer to everyone something like: “Half Priced Listing” or “2% listings” or something similar. Since they’re offering a discount off the “usual” price (3%), many of these compromise/cut services in lieu of charging the norm. They may “cut corners” by: not using professional photography, using combo lockboxes, bare-bones MLS/web listings, and even limitations on customer service and/or availability of the agent.
Make sure to ask plenty of questions when considering hiring a discount agent or an agent that offers a discount contingent on additional sales/conditions. You should get a clear picture of what you get, and what you don’t get for that discount. What “extras” are involved when a situation is out of the norm. What are the contract periods? Are there any guarantees or conditions?
Nearly every agency is built around the traditional 6% model. Brokers/agents expect to receive 3% representing a buyer, and 3% representing a seller. The brokerage takes their cut and the agent gets their split. If the agency is built upon a traditional 6% model and they’re offering a discount, it nearly always comes with a caveat.
Texas Roadrunner Realty is NOT a discount agency, we are a full-service real estate company and cut no corners (we’d argue that we do MORE than MOST). Instead of charging a percentage-based commission, we offer our professional full-service listing service for a flat fee, regardless of the sales price. With the widespread adoption of the internet, social media, and smartphones we realize the real estate market is not the same as it was even 5 years ago. We are a 21st-century tech company focused on using the modern tools of today, with an emphasis on efficiency, five-star service, yet with a traditional face-to-face relationship. See what our past clients have to say, check out our frequently asked questions, and see how much you can save!