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Rebates! Rebates! Get 'em while they're hot!!

Ok, so today I have had an awakening. Over the last couple of weeks I have been negotiating, successfully, with a couple of REALTORS® from one of the "Buyer Rebate" companies in my area, and I have to say, I have been impressed. Both REALTORS® have been on the ball and have done an excellent job of communicating and getting the deals pending. This has given me a new found attitude towards "discounters".

The first thing I liked was that all communications have been done via E-mail. To me, this is a big plus. It saves time, all contracts are more legible, as opposed to faxing everything, and no phone tag. Secondly, the offers they presented were complete, in that they had done their homework, with getting the Buyers pre-approved and the initial offers were very close to listing price, not much negotiating required. The thing that really made the offers appealing was the fact, that the Buyers, in both cases, were using the "rebate" to apply towards their closing costs. This meant that they were only asking my Sellers for minimal contributions instead of the normal 6%.

All in all, I have been very impressed. Now if I can just get the "full service" REALTORS® to be as efficient, I will be a happy camper. The first deal I had negotiated with this company closed in 10 days. The one I negotiated yesterday is trying to close in 21 days. So, maybe, their "reduced" commissions have caused them to be more efficient and have put pressure on them to only work with qualified Buyers. Maybe, just maybe, they are on to something here. Maybe some "full service" REALTORS® need to step it up a notch and quit throwing deals up against the wall and hoping they stick.

Maybe, just maybe, I'll offer some discounts and some rebates. Or, maybe NOT!!

Posted by Bryant Tutas Broker/REALTOR(R) Tutas Towne Realty, Inc on 01/17/2007 01:16 PM

Comments (35)

buyer rebates, opinion

35 Comments on Rebates! Rebates! Get 'em while they're hot!!

JAN

2007

Reserved Parking For #1 "The Lovely Wife"...TLW...ROAR!

Hubba! Bubba! Wink. Wink.

Before I actually comment I have to get this out of my system:

"OUR SELLERS ARE NOT WALLS"...

There. I feel better now :)

The deals really have been going smoothly let's hope it stays like that. Let's give em an open mind. I like that idea :)

I have more to say, but I will have to come back to this...You're forcing me to get off my laptop and EAT. LOL. But you're right I do need to EAT :)

Bryant, there's a call for all of us to wake up and smell the coffee! If the discounters are getting on the ball we have to be even more diligent with our business!

I always wondered how the double sided discounter can do it! I understand that more signs = more buyer calls = mo money. I guess they just live with lower overhead or are more efficient as you pointed out!

Bryant.. "I will be a happy camper" ?!?!?! I figured you got happy coming out of your ears. :))

I like the email and digital route.. like you say.. easier and better. especially the faxes.

dashingly handsome real estate appraiser in west palm beach florida I expect the discount brokers will happily post their insights below.. we'll see. IMHO, discounter or not, just do the job right and completely, without loose ends, bad attitude, sloppy work or slacking.

Glad to hear that you're having success with these types of deals. We will probably see more of this (hopefully) in the future. It is so much easier to communicate via email than faxing or phoning. The paperless paper trail is also more reliable and certainly less prone to "gone missing" than hard copy but sadly, not all Realtors® are created equal! Some just like things done the way they've always done it, some are just now figuring out how to use email.

I think the key is technology and commitment. The alternative commission models are attracting the good buyers (ie good credit) because they won't service the bottom of the credit scale.

That's okay. Ironically, an exclusive listing agent should refocus his "broker marketing" to embrace those alternative commission models.

Brian, you said this****Ironically, an exclusive listing agent should refocus his "broker marketing" to embrace those alternative commission models.*** So true my friend, so true. There are many companies that are hostile towards the "discount" biz plan. NOT ME. They can sell my listings anytime. My entire biz plan is based on getting other REALTORS(R) to sell my listings. This is an opportunity, I personally, plan on taking advantage of.

Joanne, electronic communications is definitely the way to go. Once I have a deal negotiated all of my communications go into E-mail mode from that point on. I can follow up on all of my deal in about 30 minutes first thing in the morning and then be done with it for the day. Playing phone tag is the biggest waste of time there is.

Nick, I'm still trying to figure out how to send yo an E-mail:)

Renee, efficiency and volume. Not a bad plan if the agents are willing to work harder for less. The Brokers make out very well.

Chris, It is definitely the time to get better at what we do. If not we can kiss our customers/clients goodbye.

TLW, your comment reminds me of a Pink Floyd song. No walls for us!!!

Whether they are discounters or not, you gotta love the transactions done by email. Unfortunately, it is not done that way here often enough. Most of my sellers are pretty tech savvy - it's the agents that haven't figured it out yet. :-)

La La La...Just a 'nother brick the wall...La La La La...

Pretend I am singing to you. It works better like that :)

TLW...ROAR

BB,

What about a little spin on this? What if these "discounters" had heard about your reputation (here in the Rain) and have been anonomysly (as a consumer) logging onto AR and following your posts. They probably deduced that you are a no nonsense kind of guy and readily post about your experiences (good or bad). Also probably deduced that you were a savvy Realtor and a bit of a "techie" type considering all the magic you work in your posts. Maybe they honed up just for you hoping to avoid being the subject matter of one of your future posts. A reputation can precede oneself. Naw...probably too far fetched. or really? Enjoy and good luck....you need a good streak now and then.

I wonder if the buyers with these rebaters might have "tested" the market first with full-service agents, then, when they knew their price point and property profile, they went with the rebater to capture some amount back to them - in essence discarding the value of their "previous" agent's work, but enabling the discounter to delivery ready-to-close deals?

Gabriel, That's and interesting thought. Hmm........ These particular Buyers are actually going through a non-profit organization called ACORN that assist Buyers with lower income in getting grants to help with their down payment and/or closing costs. I would be more inclined to think this organization has hooked up with the rebate company as a way to assist the buyers even further.

Ron, I have actually received several listing referrals from REALTORS(R) that found me through my blog and because of the way I write, decided as the right man for the job.

Linda, I still deal with REALTORS(R) that don't even have fax capabilities. Truly amazing.

No Fax? Please, just the fax maa'm :-) ok ok sry. I think this proves the point that it isn't whether someone is a discounter, flat fee or full service but how good they are. JMHO

You are ranked #3 in FL???!!! C'mon, who's supposedly ranked ahead of you. Post the links because I'm going to pay them a visit and knock them down a notch or two. In fact, I'll find Mikey and a few others and we'll make them an offer they can' refuse!

JAN

2007

I'm impressed, Bryant. I have not had to deal with discounters yet, but if the experience goes as well as your did I would be pleased. Clearly many agents need to get on the ball and clean up their act. Using the technology should be a given. Seems you can find good people in any brokerage.

Hi Bryant

Like you I was also VERY IMPRESSED with the experience I had with a "discounter", the deal went through without a hitch, and the agent delivered top quality service. It was in a friendly after the closing chat, that she revealed she made a lot less than I did. She had to pay back to the buyer a percentage of her side. So in the long run it was not as profitable for her as it was for me. I would do business anytime with an agent of this caliber again... Good post and I am glad we had the same good experience!

BB... this is really about doing the job right. The notion that a discounter is going to be worse simply because they are a discounter is as false as a REALTOR® is going to be great just because he is a REALTOR®. Neither statement can possibly be true in the absolute. I think Nick nailed it above, "IMHO, discounter or not, just do the job right and completely, without loose ends, bad attitude, sloppy work or slacking." If there are good discounters out there, and it appears from your post there are, they will improve the overall market - discounter or not.

BB I have to agree with Jeff it seems like you just ran into some really good agents that share some of the same values you do. They like to get the job done, efficiently and done right.

Brain, one of the Realtors that I work with would be considered a "discounter", but every deal that I have done with his has been as smooth as it possibly could be. He dots all the "i's" and crosses all the "t's", and he is happy with what he makes on a deal.

Thanks for all the comments. It's always about the individual REALTOR(R). Company size and commission charged have nothing to do with it. Both of these REALTORS(R) were very very good and hope they continue to show and sell my properties. You can be sure I will spend some time bonding with them and will make sure it is a very smooth transaction for them. Doing this keeps them coming back. Heck I have 20 more homes I need them to sell:)

I think we should start calling you Mr. Favorably Impressed :)

Bryant,

I haven't dealt with a discount company to date. If it works, then it works. I agree that other agents need to raise the bar when it comes to pre approving buyers. All of our clients deserve the very best from us, and if this makes some better, then so be it.

JAN

2007

I had one a bit ago that went really well. Buyer came direct, sharp dude. Represented himself. We gave him 3% off the asking price since he had no buyer agent. Seller made out better than a full price offer from an agent as costs were on a lower amount. Seller net was greater than full price. Buyer was thrilled to get the buyer agent fee and didn't negotiate beyond that. I had the listing for 4 fays when he came to the first Open House, so no loss for me. WIN< WIN< WIN everybody Won!

Buyer went on vacation when contract was signed and came back for closing. No questions...no problems. Smooth

I don't call it a "rebate" though. If the seller pays less than 3% do you call it a rebate? I just call it negotiation of the Buyer Agent Fee...same way I negotiate with sellers.

Ardell, It wasn't a reduction of commission to the seller it was a company that rebates a portion of their commission directly to the buyer. In this case 20% of the selling side. In you r situation it was just a reduction of your fee to the sellers with the savings be passed through to the buyer. I do that as well if the opportunity arrises.

Bryant...interesting take. Especially since it has worked. And as you pointed out and Brian B. added to it, being more efficient. And yes, why should you care, since they are selling your homes....and quickly. As someone else mentioned, it might not be so much about the rebate part, but again, being efficient. I think as you mentioned, so many lose site of this and just throw stuff up against the wall.

Bryant, Thanks for sharing your experience on this deal. I think that it is great to have competition to force us all to do a better job. It's a true wake up call to see that it can be done well for less. Usually when you hear about a discounter all you get in response is "You get what you pay for", this being some kind of justification to continue with the status quo. I don't like the rebates but I'm making sure that when they become the common way of doing things, I'm going to be able to compete.

I figure, what another company chooses to do with their money is their business. As long as the REALTOR(R) does their job, I'm a happy camper.

Can't disagree there....

I love to take advantage of Staples' rebates...does that count?

I guess the discounters have gotten a bad rep' within the agent community much the same as agents have with the general public, eh? It's never good to generalize. Glad things are working out for you Bryant. And thanks for the Acorn bit. I've heard of the Nehemiah one but Acorn is new to me.

Ardell, how gracious of you to cut back on your commission. I do that when the situation is right as well, but some folks won't, ever. One gal I met in continuing ed class was bragging that she had sold a listing at an open house 2 weeks after she got it. I asked her if she had given up some commission to help the deal and she replied "Not only did I not give up any commission, I am also making money by being the mortgage broker." I was floored. Not that she was making so much money (6% on $350K plus 1.5%? on the loan) but it was more her attitude about it. This was the same woman that had told me she saved all her receipts, even the ones from lunch at McD's with the kiddies to use for her taxes. yikes! I don't know, I kinda like being able to sleep when I lay may head down on the pillow each night :-)

JAN

2007

We will take efficiency any day from any body!!

And if they don't email, just have them fax it which goes right into my email.

How are you doing with your situation in Florida?

My best to TLW and how is baby Raine?

www.homerome.com

Baltimore,Md.

Margaret...

We are doing great and the situation I believe you're asking about is very much under control :)

Turns out a little extra wording goes a very very long way. Giddy UP :)

Baby Raine is doing fine and so am I. Thanks for asking. That was very kind of you.

TLW...ROAR!

FEB

2007

Great posting on rebating. Realtors shouldn't hate them for rebating and make blanket statements that they suck. They should instead focus on agents that suck, regardless of what they charge.

Great Post. What are you thoughts on Broker Admin Fees? $395 Realty Firm's "Admin Fee": Junk or Legit?

Frank Borges LL0SA- Virginia Broker/ Owner FranklyRealty.com

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