Home : Blogs : LaShawn Norden, REALTOR, (321) 377-0157 Your Real Estate Advocate in Florida : Central Florida Real Estate~The Good, the Bad & The Ugly by LaShawn Norden, RE/MAX REALTOR

Are you more likely to show a house if it's paying a BONUS??

Hi all! Today is my first official BLOG on AR! I was invited to join last week by Debbie Summers, who is a "legend" in my blogging mind :) and since then, I've read up as much as I can on this whole blogging thing and have decided to go for it! So, here it goes...

Like most agents working with Sellers in this market, I've been asking for price reductions, which is enough to give you an ulcer if you do it week after week and month after month...

Anyways, one of the Sellers I have been talking to commented that they think it's better to offer a $10,000 bonus to the selling agent instead of reducing the listing price by the same amount. I replied that REALTORS should be ethical and show their Buyer those listings in the MLS that meet their Buyer's criteria, whether there is a bonus or not.

Besides, haven't we all been taught that it is the Buyer who is purchasing the house (not the agent) and that by reducing the price, the home will attract additional buyers in the "new" lower price range?

But, after overhearing a conversation earlier...I am not so sure I advised my client properly. I was shocked to hear one of my fellow agents make the statement "Since there are so many listings to pick from when scheduling showings, I first show properties that are paying a higher commission or a bonus before those that do not."

After hearing this, I was initially appalled...but then I had to really think about how or why this is happening. It is my thought that because agents are selling fewer homes, they are trying to "make up" for money not earned by having their clients see only those homes that offer higher commissions or a bonus...could this be true?? Maybe that's why builders offer commission plus bonuses and why Sellers are now wanting to do the same in the resale market?

So, here's my question to you: Are you more inclined to show a home if it's paying a bonus?

And who said this "blogging" thing couldn't be fun???

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Posted by LaShawn Norden, REALTOR, (321) 377-0157 Your Real Estate Advocate in Florida on 04/14/2008 06:34 PM

Comments (17)

ethics, commission, bonus

Post is included in group: RE/MAX Active Rain Bloggers

17 Comments on Are you more likely to show a house if it's paying a BONUS??

APR

2008

La$hawn - CONGRATULATIONS ON YOUR FIRST POST!!!! I'm so proud of you!

I have to tell you that the bonus doesn't matter to me... So many buyers are looking online too and if they see a home online how can I not show it to them, even if it has a lesser commission? It's not all about me, if the house fits... you must show it!

The selling bonus really does not mean nothing to me. I got one last year when I sold a house and sellers gave a 1,000 bonus. But that is not why I sold the house, I just thought it was gravy.

I don't really pay much attention to seller's bonuses,because it has been my experience that it is the first thing to go.

Thanks to Debbie for being the first to read and reply to my first blog!

Hi Lashawn! Congratulations on your first post and welcome to ActiveRain where I have learned so many things from countless Realtors and Loan officers and I know you will to.

Have a great day!

Welcome to the blogging world. I have to agree with everyone on this. It isn't about us, it is about our clients. We need to keep their best interest in mind at all times. I know it can be hard when sales are few, but we must keep our morals in line, so when the market pickes up, we aren't dropped off :)

Great blog by the way :)

All I can do is report on the stat's in our area, which is San Diego, Ca. All the above answers are nice , but reality is that when you plug in the data the homes that offer a higher commission, a incentive etc sell 5 times faster than those that offer less. 50% of the homes that have higher commissions sell faster than those homes that do not. As much as we do not want to acknowledge that agents shop commission it seems that in this real estate market many do.

Congrats on your first blog! I would never dream of showing a home because I would get paid more. I recently gave up a $5000 bonus for a buyer of mine. They needed the closing costs and the sellers were tapped out. I would have felt horrible not doing that for them. They found the home on the Internet. Great topic!

I always put my clients first and show the homes regardless of the commission offer or the bonus.

LaShawn,

Great move on your part to join the Rain. Welcome. The network is full of info on real estate, mortgages, Internet marketing, SEO, you name it. Enjoy and happy blogging. I let the agents answer the first question.

Hi LaShawn ~ Welcome to ActiveRain!!

To me a bonus is just that - a bonus. The bonus house is the same as any other house, and if it works out that I sell it, then thats a bonus!

Wow, LaShawn, I am so impressed by your first post! Debbie is really great, I read her stuff all of the time! I don't really pay attention to the bonus. To me, it is usually the first thing negotiated right out of the contract. If I get it, I split it with my purchaser. I never want them to think their best interests were ever compromised. Good luck and see you around AR!

Hi LaShawn: Since more and more of my clients pick out the houses they want to see from looking at houses on the Internet, it really doesn't make any difference to me if the seller is offering an additional incentive. If they happen to purchase one with an additional incentive, it's just a bonus to me.

WOW..I am so very thankful for the honest answers and genuine welcome that I have received after my first blog. Like a child walking into class for the very first time, I was a little concerned about posting my first blog with a topic such as this...but I was pleased to see that at least the "majority" believes we have a responsibility to the public to show them the inventory as it meets their criteria, not because we could potentially make more money!

Whenever I offer a bonus, there is much more activity on the house. Houses with a higher commission also sell faster as long as they aren't overpriced.

Terrific first post!

A bonus on a house is not right, an agent should not be pushing a paticular house on their buyer clients because of a bonus. I agree that the price needs to be reduced, and your first recommendation to your client was the right one.

APR

2008

Here's my take on this...

I only look at the transaction - not the dollars. With enough transactions, the dollars will come. (Luckily I have been in the top 2% in sales in my market area for close to 13 years). I also know that in my area - about 80% of the Realtors had Less than 1 transaction per month. With an Average sales price of less than $300K (well... you do the math).

So, if there are 20, 30, 50 properties that an agent can show a buyer within a certain price range (many of which meet their criteria), SOMETHING has to make the deciding factor. Even the best agent cannot show 30 houses on a Saturday afternoon.

The reality is this: Buyers have the ultimate decision ovver what they buy... But Agents have control over what the buyer sees - AND the order that thy see it in.

Most of my transactions are on the Seller's side. I do use this to my advantage. And my sales stats speak Loudly & Clearly.

(Your mileage may vary).

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