I think as a REALTOR we sometimes think as the commission amount is helping us.  But I think of it as also benefiting the seller.  I call it a marketing fee, because that is what I am going to use it for.  Professionals who receive commissions are hired to sell something, where as listing agents we are hired to market properties to other agents, buyers, neighbors or appraisers.

I believe the marketing fee is in the best interest of the seller.  Next to the price it is the most important thing a seller can do to get their home sold.

If an agent comes in and immediately offers to take a listing at a reduced commission (and understand commission and marketing fee are very different) it is like taking an upfront apology because that is all they have to offer!

These agents are betting that another agent is going to sell the property and no marketing is needed.   Other agents may show it but likely they will use it to sell other properties that are willing to pay a higher commission.  Sad but true, it does happen.

Please remember, as agents we don't get paid until the house sells.  And if I thought that getting the house sold would be faster if I charged a smaller fee I'd be the first to do it, because I want to get paid as soon as possible.  But the fact of the matter is it does not work and it does not make good sense.

I talked to a seller who had also talked to another agent, who offered a lower commission.  This seller owned a nice Italian restaurant.  So I said, "If someone came to your restaurant for dinner, say ordered a pasta entree, salad and drink, do you think that would cost 15-20 dollars?"  He said yes.  Then I said, "Well, isn't it true they could probably get the same meal at Fazoli's for 5-6 dollars?" He got very indignant and said,  "We provide really good service, we have an excellent atmosphere, we use the finest ingredients," etc.  I replied, "So you get what you pay for."  He agreed.

No matter what fee you charge, there will alway be someone who will charge less.  I must sell a net gain that equals the difference.  I ask sellers, if my fees were different would you hire me?  They cite benefits I offer over the competitor.  I then reply, if you prefer these benefits over the competitor would not you expect to pay more?  If they don't see the difference than I have not established an value-added benefit.