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Commission Vs. Service, How do you explain the two???

By
Real Estate Agent with Fathom Realty Washington LLC

 

A person calls me and the first question is how much do I charge in commission?  This is a pretty basic question however it can be answered in so many different ways.  I know the general area in which they may be selling but I don't know if they are selling vacant land or residential property.

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My competition for listings in this area only puts for sale signs out and calls that marketing.  I do a comprehensive package with all my listings and feel that I give the most bang for the buck when it comes to marketing.

As a response to this question I relate all that I do for my commission.  Several of my competitors only give the cost of a listing side of the commission.  Now if the caller only wants to know what you charge on your side of the transaction this is the right answer.  There are few clients who will understand the commission split way of doing business and are usually taken in when they compare a 3 1/2% commission and a 6 percent commission.  This is hard to explain over the phone however the client has already told you the commission means more than what they receive for their money.

My preference is to break down all the costs and send them a copy of their net proceeds rather than giving a set commission over the phone.  In this way I can explain the commission process and also what they get when they work with me.  I'm not afraid putting what I will do in writing because it is the way I treat all my clients and listings.  You'll find No hidden charges or surprises when you work with me.

So the question really is, are you shopping for service or cost of commission? Most of the time there can be a huge difference...

 

 

This post was authored by Paul Henderson. ©2011, All Rights Reserved, This content may not be reproduced or reprinted (Except for ActiveRain Re-blogging) without express written permission of Paul HendersonRE/MAX Professionals, Tacoma, WA.

Posted by

 and courtesy of 

Paul S. Henderson, Residential Real Estate Broker 

Tacoma Washington 

Realtor ® BPOR, CRS, GRI, CDPE

Fathom Realty WA LLC

Serving

South Puget Sound in Washington State

 

 

 

 

Paul's Service Area


 

 

As a Residential Broker and Relocation Specialist, I sell homes in or around ,Tacoma, Gig Harbor, Lakewood, Steilacoom,  University Place, DuPont and Hartstene Pointe in Washington State.
Please visit my website at http://www.hartstenepointe.com to search for information 

(all information is believed to be accurate but is not guaranteed or warranted in any way)

Referrals are always welcomed and appreciated, Thank-you!

(As a member of the NWMLS, this blog post is intended to comply with NWMLS rules as pertaining to blogging.)

isspfmtysmily

iaa

 

Comments(5)

Hannah Williams
HomeStarr Realty - Philadelphia, PA
Expertise NE Philadelphia & Bucks 215-820-3376

Paul  it is also a matter of self worth .. Sometimes newer agents ask me how to handle this question . You need to know what you are worth .Years ago I learned from a very successful woman who would very self confidingly  say to the client  6- 7- or 8 I am worth 8 but I will take 6 .. :0)

HelpfulHannah

Sep 22, 2011 10:56 AM
Lou Ludwig
Ludwig & Associates - Boca Raton, FL
Designations Earned CRB, CRS, CIPS, GRI, SRES, TRC

Paul

Our Professional Fee is related to the services rendered.

Good luck and success.

Lou Ludwig

Sep 22, 2011 02:50 PM
John Cannata
214-728-0449 http://TexasLoanGuy.com - Frisco, TX
Texas Home Mortgage - Purchase or Refinance

Excellent point Paul. I look at the same point when people talk about rates. I could certainly tell you the rates are low, but forget to mention what the cost is to get such a rate. When shopping for a mortgage, people need to look at the entire picture, not just the rate someone is quoting.

Sep 23, 2011 04:54 PM
Dinah Lee Griffey
Windermere Peninsula Properties - Allyn, WA
Managing Broker Windermere Peninsula Properties

In this market especially service is what is going to sell a home. There seems to be no easy transaction and Buyers and Sellers are going to need someone who knows the ropes and is willing to go the extra mile to close a transaction. You can't put a price on that.

Sep 24, 2011 06:45 AM
Gabrielle Kamahele Rhind
KGC Properties LLC, Tucson Property Management & Real Estate - Tucson, AZ
Broker/Owner

HI PAUL!  If only people understood that saving some money doesn't always save them money!  I like what Hannah wrote - and a mentor of mine once said, "I prefer 8% for full service - let me show you the services at that level, and we can remove benefits you'd rather not have and reduce commission accordingly." 

Sep 28, 2011 07:46 AM