I recently had a former client contact me about purchasing a home. About a year ago, he rented a home along with a friend. The friend was now married and my client had moved in with his girlfriend. He contacted me months earlier and we stayed in touch.
Then it happened, one day he emailed me that he was ready to start looking. He sent me an email asking me if I would "
discount" my commission. At first, I thought - former client okay I can provide some sort of rebate. It
IS NOT my normal practice to provide discounts. So instead of saying "YES," I called my client on the phone. I asked him, what sort of discount he was seeking. He commented, "oh well we just need someone to let us into the homes." I then asked, "who is going to write the contract?" He informed me he had not thought that far ahead.
WOW.
After our phone conversation, I emailed him a list of my services and asked him to indicate which services he did not want and in turn I could provide a discount. As soon as I sent the list, I remember that I had read what a fellow Realtor wrote on Point2Agent.com. He commented that he would discount his services when Tiffany & Co. discounted their diamonds.
About an hour after I sent the list of services, I sent my client another email saying that I could not represent him in his best interest and also protect him from any liability with limiting my services. I did not mention the obvious:
- The commission is paid by the seller and not the buyer, so why did he need a discount?
- He should be asking me to ask the seller to pay for closing costs instead of a discount.
- I would negotiate a sales price in his favor.
- I would negotiate for the seller to pay for other costs such as: home inspection and
appraisal.
He emailed me back and said that he had found another Agent that was willing to provide a "discount." I am glad that I did not give in just to get a sale, because I realize that the whole transaction would have
BEEN A DISASTER. This experience reminds me of the sellers who do not want to pay for "FULL SERVICE." However, half way through the transaction realize that they have no experience with Real Estate, have questions they do not know how to answer or better yet, that we as Real Estate professionals do EARN our commission, we just make it look effortless. It is ironic that people do not question their Doctor, Mechanic or Attorney when it comes to services and fees.
Even though the market is tight, I am not going to "sell my soul," just to make a living. I also know that I would rather lose a client than to have the client bad mouth me even though I performed all the services that we agreed upon. I know that the professionalism and integrity will far out last the "discounters" in our profession.
For more information or assistance with setting up a real estate investment team (REIT), mortgage planning options or property management, contact Jennifer Johnson, your trusted real estate investment advisor.
Copyright© 2007 by Jennifer V-E Johnson. Others may not copy this material without written permission of Jennifer V-E Johnson. The views expressed in this RE News are those of the author(s). If you are currently working with a Realtor® this is not intended as a solicitation.
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