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Should I sell my house using a flat fee listing service?

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When it comes to selling your home, it is probably true that it is the highest price item you will ever sell. So determining how best to sell it is a very important consideration. There are a wide range of selling methods, including using a traditional real estate agent, going “for sale by owner,” and now there are more services that offer flat fee listing services.

This article will provide you with some information to help you determine if you should use a traditional listing service or a flat fee service.

What services does a traditional real estate agent provide for home listings?

The services provided by traditional real estate brokers have some requirements, which are called the uniform duties and are required to be provided by all licensed real estate agents. In addition, there are other services that vary based on the level of service provided. You can see our real estate listing services and fees here.

In general, the following services are provided:


  1. Pricing. This is perhaps the most important step in the process. Pricing too low can cause you to miss out on money. Pricing too high can cause your home to sit on the market longer than others, which gives the buyers an advantage in negotiations.
  2. Consultation on repairs and preparation. What should you do to prepare your home for sale? What repairs are required or would provide you a positive return on investment?
  3. Photos and marketing material.
  4. Lock box and reasonable security.
  5. Yard sign.
  6. Listing in MLS. This is another one of the steps of utmost important. Listing the home in MLS puts the house in a database that does several things. First, it feeds to all real estate agents in the area providing notifications and updates. If the buyer is using a real estate agent (which they almost certainly are), they will find the house via MLS.  This also pushes your listing out to other services, such as Zillow and Trulia. Simply put, if someone wants to find your house, they will almost certainly find it because it was entered in MLS. When someone tries to sell a home as “for sale by owner,” this is why they often fail or end up receiving much less for the home than it is worth–they are not getting it in front of enough people.

Listing Period

  1. While the house is listed, your agent may optionally hold open houses and other marketing tactics as agreed upon.
  2. Showings will be managed and screened. Another key step is managing the calls that will come in when your home is on the market. During the initial days, the calls be overwhelming. Having a real estate agent means your showing requests will be screened and only approved to active agents who are licensed to properly show and secure listed homes. Most offices have some form of centralized showing management.
  3. Feedback from showings.
  4. Offer review and acceptance. Your agent will also receive offers for your property, evaluate them, and present them to you. There are many ins and outs of offers, which are typically 17+ page legal documents. You really want a pro on your side who can help you evaluate the contract.

Under Contract

  1. You’ve accepted an offer on the house. To me this is where the real value of a real estate agent is. In today’s market, home sellers often think it is easier for agents to sell homes. While this is true to an extent, the majority of work really happens once the home is under contract. This is where the agent’s expertise and guidance is most valuable. It ensures the house sells properly, your interests are protected, and everything is handled legally and properly.
  2. Legal and contract paperwork and management.
  3. Title and escrow facilitation.
  4. Lending oversight and negotiation.
  5. Negotiation of inspection findings.
  6. Contract and date management.
  7. Coordination of closing.

As you can see, the real estate agent that sells your home has many responsibilities to manage on your behalf. This is partially due to the high price of assets being transacted, but also due to regulatory requirements that govern the sale of a home. It’s a big process and you want someone to protect your best interests!

How much do traditional agents charge to list your home for sale?

First, it’s important to know that real estate agent fees are negotiable. There is not a set fee and different areas vary considerably. The Ferguson Team charges between 5.5% and 6.5% depending on services provided. We also provide numerous incentives that may help lower that fee. This is competitive for our area.

How does this fee break down?

Let’s say you agree to a 6% fee to list your home. Here’s how

  1. 3% is typically paid to the buyer’s agent. That means when another agent brings buyers to show your home, half of a 6% listing would be paid to them.
  2. 3% is kept by the listing agent in exchange for having marketed, listed, and closed the sale of your home.

So you can see this 6% fee is really split by two different real estate agents.

How do flat fee listing companies work?

Recently, there have been numerous companies offering flat fee listing services as competitive alternatives to traditional listing services. For example, they may say we will sell your home for a flat fee of $2,500.

If you are considering one of these services, the best recommendation I can give is to match their services against the list provided by traditional agents above. Some companies may provide a subset of those services. If that lack of services results in you pocketing less money once the transaction is complete, the reduction in fee is clearly not worth it.

The other critical consideration is the $2,500 is just for the listing side. So while they may advertise a $2,500 fee (which sounds much less than 6%), that is not including the fee that needs to be paid to the buyer’s agent. The company may do one of these options to keep the fee as low as possible:

  1. Not advertise your listing to other agents. They will try to sell it themselves. Some companies look to handle both the selling and buying side themselves, which means your house won’t be marketed to every possible buyer. If there are less people aware of your house, you will make less money. That is a very simple supply and demand principle.
  2. Pay buyer agents a reduced fee. When your house is put in MLS, the fee paid to the buyer’s agent is published. In our market, 3% is competitive. While it may not be the right thing to do, if agents see they earn less by selling your house, they may not present it to their buyers. Again, this causes a supply and demand problem and results in you pocketing less money.
  3. Not clarify that you will pay the flat fee plus a buyer’s agent commission. In looking at most of the flat fee listing sites in my area, I see this most commonly. They may advertise a $2,500 flat fee, but in the legal text at bottom, they note in small text that you will also have to pay 3% to a buyer agent.

All in all, the fee may be advertised as a low flat fee, but in reality, it will either be much higher or your home won’t be marketed to its full potential audience.

Conclusion: should you sell your house with a flat fee service?

I am not here to tell you that flat fee services are bad or misleading, but I do want to urge you to do your due diligence and really ask questions before deciding which direction you want to go. As I started out, this is probably the biggest sale of your life, so take the time to educate yourself on the process. The information above should provide what you need to find the right service for you.

As always, if you have any questions about this content or how your property values will be affected, just drop us a comment here, call us at 970-573-6441 or Contact Us online. Thanks for reading!

Ready to talk to a Greeley Real Estate Agent?

We love to hear from you.

Call us at 970-573-6441 or


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