Probably one of the biggest fears an agent will face is when a seller asks you to list their home for less than full commission. For most agents the fist instinct is to give in. After all, Isn't a 5% listing just as good as a 6% listing? At least you have the listing.

Consider this: On an average sales price of $500,000 every time you give into a 5% commission you leave $5,000 on the table. If you list twenty home in a year you have allowed $100,000 to slip away. Are you willing to learn a new technique for $100,000?

Here's what you don't do: Don't say "No, any other questions", Don't say "No". Don't start your speech about what you do and how much money spend to market a home, the sellers don't care.

Here's what you do: When a seller asks you if you will do the listing for 5% instead of 6% the first thing you must do is separate commission from net income. The seller is not asking for less commission because he wants to pay you less, he is asking for less commission because he wants to net more. When you separate the two, getting the full 6% is a breeze.

Example:

Seller: Will you do the listing at 5%?

Agent: I will never allow commission to stand in the way of us doing business, I have to ask, why would you want to market your home less than six percent?

Seller: Because I need to put as much money down on my next purchase as possible.

Agent: So it's not the commission your concerned about its the amount you are going to net?

Seller: Yes

The key is to separate the commission from net. Once this is done, you can refer back to your marketing plan. How your ability to expose more buyers to their home will actually net them more money. For example:

Say their home is marketed with three auction houses. Auction house number one attracts 300 buyers. Auction house number two has 500 buyers and Auction house number three has 1000 buyers. Which auction house will net the most money for the seller? Auction house number three.

The law of marketing: Exposure Created Demand, Demand creates higher pricing, Higher pricing means a higher net for your seller. If you presented your listing presentation the way I teach it, bringing the seller to understand he needs buyers, and explaining what you do to expose their homes to buyers, YOU WILL GET 6%.

If you want to learn how to get 7% and 8% listings go to www.Brettnoel.comand let me know you want to learn how to get 7% and 8% listings.  I will show you how you use MLS printouts to guarantee the highest commission.

Brett Noel / Success Coach / Coaching agents to become millionaires

 

 

 

 

9 Comments on HOW TO HANDLE A COMMISSION OBJECTION

AGENTS --  Ever heard of the Sherman Anti-Trust Act?  You should read it and learn it.  - Not being nasty - just trying to save you and your brokers licence.

 

09/18/2007 10:56 PM by James Downing - REALTORĀ® - Washington DC Real Estate (Coldwell Banker Residential Brokerage)


Interesting Brett,

I do something similar but I like the simpleness of your approach

Great job!

09/18/2007 10:56 PM by Jason & Deanna Long Breckenridge Real Estate (The Long Group)


I like it.  I will give this a try the next time it comes up. 

Thanks.

09/18/2007 10:58 PM by Rio Rancho NM Real Estate | Tego Venturi (Keller Williams Realty)


This is one of the first things my broker taught me when I first came to his office.  Thanks for putting it out there for all to see!

09/19/2007 03:21 AM by Roswell Georgia Real Estate Agent - Nancy Rivera (RE/MAX Leading Edge in Roswell Ga)


Regarding James Downing's response (above) to Bret's post:  James brings up an important point.  Yes, we need to be super careful about doing anything that could be perceived as any sort of collusion in setting commissions.  There are people out there who are eager to accuse any real estate agent of restraint of trade and price fixing.

 

When giving examples of dealing with commissions, it would probably be best to make it very clear that any examples are hypothetical, and maybe use several examples with different numbers, maybe even use numbers that would obviously be seen as unrealistic by any reasonable person.  We definitely do not want to give an impression that there is a "normal," "usual," or "standard" commission, but there must be some way of discussing commission objections without putting ourselves at risk.  Maybe we need to use "X," "Y," and "Z" in place of numbers?

09/19/2007 10:30 AM by John R. Pulskamp, MA, GRI, SRES, e-PRO (Century 21 All Moves)


Good information.  Mind if I share it with some of my Realtor partners who have not (yet) become members of AR?

09/19/2007 10:51 AM by Matthew Rosov, Certified Mortgage Planning Specialist (Envision Lending Group)


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Real Estate Trainer: Brett Noel, California's Success Coach  Author / Motivational Speaker / Broker (Keller Williams "Productivity Coach")
Brett Noel, California's Success Coach Author / Motivational Speaker / Broker
Paso Robles, CA
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