Do You Understand Your Relationship with A/Your Realtor

Real Estate Agent with Keller Williams Keystone Realty RS294813

I'm going to go out on a limb here and say that about 80% of people have no idea how Realtors get paid, or how Real Estate relationships work.  My goal is to clear that up so that your Realtor doesn't have to deal with constant frustration.  This blog isn't designed to complain or make you, the consumer, feel stupid, but to educate you about the process. 

First - BUYERS -Realtors do not receive salaries, we get paid based on commission only.  This means that if you don't buy something, we don't get paid.  Let me elaborate on this.  We spend a lot of time and gas to show properties.  This money comes out of our pockets.  Don't abuse your Realtor.  Our job is to serve you, and do everything we can to help you find what you're looking for, we just ask that you respect our time and money like we do yours. 

Second - Sellers - Realtors do not receive salaries, we get paid on commission only.  This means that if your house doesn't sell we don't get paid.  The advertising for your house, the gas, the time, the open houses (and those cute sandwiches), those pretty packets we print out are all paid for on our dime until your house sells.  Advertising is expensive (call your local paper for and ask...I think I heard you jaw hit the ground).  Sellers, Listen, list your house at the price we give you, we know you want more money, but the prices aren't set by the Realtor or the seller.  Prices are set by the other properties that sold.  We don't price your house low because we don't like you, we price it where we know it will SELL.  If selling isn't your goal, then call a Realtor that likes wasting money and time (none of them). 

Relationships 101

This section is primarily dedicated to buyers.  It's much harder for Sellers to have an affair with another Realtor.  The house is listed. It has your name on a sign out front so there is little risk the seller will go behind your back.  We've heard horror stories but it isn't the norm.  Sellers also tend to choose their Realtor from past experience so they have a background information about how this person conducts business. 

Buyers, you drive us up the wall.  It isn't your fault, it's just that society in general doesn't understand real estate relationships.  When you start working with a Realtor they start dedicating time to providing a service to you.  In an ideal world a buyer should only establish this relationship with one Realtor and they should choose that person carefully.  The fundamental flaw in this process is that a lot of buyers call the office from a sign or book and can, without warning, get the worst Realtor god every put on earth. 

While we'd like to say that our profession is perfect, that would be complete BS.  There are good and bad Realtors just like there are good and bad doctors, lawyers, and used car salespeople. 

Buyers we get upset when..we work hard, show you 10 properties, then you leave us to go look at properties with another Realtor.  If you end up buying with that other Realtor you wasted all of our time.  We don't get the time back or the money.  Again we ask that you respect us the way we respect you.  If you were a plumber and I had you out 10 different times to give me estimates but never had you do any work (you never get paid) would you be happy? 

Friends - Don't call us when you have another Realtor list your house to tell us that you put it on the market and since we are in the business we should sell it.  TOO LATE, you should have called us to list the property so that we could represent you and work toward selling the property.  If you list with someone else and we have a buyer great, but if not we will simply wish you good luck.  Typically this ends in a "good luck" and a Realtor kicking himself because his friends don't understand the process. 


I hope this helps the everyday person understand how things work in the real estate world.  There are so many more examples, but this should provide a basic understanding of how we operate and how we get paid.  Contrary to popular opinion we work very hard for our money and spend a lot of money doing our jobs.  It costs money to do everything we do, and our companies do not pay for any of it. 

Posted by


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David E. Monsour, Realtor

Keller Williams Keystone Realty, Gettysburg, PA 17325


Comments (56)

Coleen DeGroff
Coldwell Banker M.M. Parrish Realtors - Gainesville, FL
Haile Plantation Real Estate - Gainesville FL

What's up with the troll on this thread? 

Feb 17, 2010 09:30 AM
David Monsour
Keller Williams Keystone Realty - Gettysburg, PA

Coleen - He is new to the site.  I'm glad you found value in the blog. 

Feb 17, 2010 10:10 AM
RJ VOjnich

Hey thanks for the article - I never thought about it or think about the money at all when im with clients i winder if they do or dont?

Feb 17, 2010 10:46 AM
Megan Martin

To the gentleman above, yes....our clients are the Kings and Queens.  But I also do not go to my dentist for a free root canal either, or my accountant to prepare my taxes for me, then file them myself and tell him "sorry".

I thought this was a fantastic article, and I appreciate your eloquence.

Feb 17, 2010 11:49 AM
Diane Schubach
Laffey Fine Homes - Port Washington, NY

Nice post. I have had conversations with people I know who say "I just listed my house so if you bring a buyer you can get half the commission." Yes, I know that, any agent can - you're not doing me a favor!

You touched on the relationship being like dating when you alluded to "having an affair." That's how I look at it. With buyers, the first meeting is like going out on a date. But if you want me to deliver client-level services, then you are going to have to "marry" me. That means a buyer-brokerage agreement-and you will be responsible for my commission. Otherwise I may show you a few homes out of the goodness of my heart, but you will just be a customer. You remember what mom used to say, why buy the cow when you are getting the milk for free?

I am shocked at the lack of knowledge about agency. If some of these comments are from states with agency laws, then it's no wonder the consumer is confused.

Feb 17, 2010 12:43 PM
Nancy Frantz - Altoona, PA
Realtor~over 20 years, RE/MAX Results Realty

Hey David, Love your post! Love it so you mind if I print it, copy it, attach it with the consumer notice and buyers contract????

Feb 17, 2010 01:00 PM
Melissa Brown
Helen Adams Realty - Charlotte, NC
Realtor - South Charlotte NC Homes for Sale

David, I thought your post was well-thought out, and it touches all of us.  We definitely need more consumer understanding in our profession.

Steve, welcome to Active Rain.  But please remember we are all colleagues on this site.  While differing opinions are welcome, personal attacks are not.  It's the Golden Rule.

Feb 17, 2010 01:43 PM
David Monsour
Keller Williams Keystone Realty - Gettysburg, PA

RJ - I doubt they think about the money, but I think they should be aware of it.  I'm not asking for anything from them, but for them to know that it costs us a lot to run ours business could prevent future issues.  I'm going to continue to do things whether or not I get paid, but it would be nice for it to be recognized every now and again.

Megan - Thanks for backing me up on this

Diane - I don't think we spend enough time going over agency.  Our consumer notice is all about it, but even I am guilty of breezing over it sometimes.

Nancy - Do whatever you want with what I've written.  It's here to help anyone that finds it useful. 

Melissa - Agreed!

Feb 17, 2010 02:09 PM
Shanna Hall
Real Estate Solutions - Kirkwood, MO
I love selling houses!!!St. Louis, MO 314-703-1311

I was just settleing into bed and reading active rain blog posts...  I must say -hd to get out of bed.  Your blog got me all fired up;)  You could hold a major pep rally with this blog and a stadium of Realtors...  Excellent post!

Feb 17, 2010 02:19 PM
Steve Cole
Your Home Team Advisors, LLC; 770-649-0060 - Atlanta, GA

Melissa, I never made a personal attack on David.  If it was perceived that way I apologize.  David appears to a very intelligent guy with a good sense of humor.  However I am not of the opinion that real estate agents in general should be trying to guide the buying public in this transaction. 

We feel real estate agents play an important role but only as a bit player not as the main act.  Their role is to help identify property and that is it.  The more technical elements are better handled by those trained in those areas such as attorneys, structural engineers and surveyors.

I understand our way of doing business is different and my message will not be well received by most real estate agents but my concern is for the client and the education of the buying public that there is a better way.

As for the golden rule, I am only treating my clients like I would like to be treated if I were buying a home.

Coleen your comment about me being a troll is funny however it does show an attitude that a lot of agents have when you dare to rock the boat.


Feb 17, 2010 03:05 PM
William James Walton Sr.
WEICHERT, REALTORS® - Briotti Group - Waterbury, CT
Greater Waterbury Real Estate


Your points are dead on...but Steve brings up something that may just have some merit, to a degree - how many companies actually have all of the players in a transaction in their employ? How many brokerages have not only a mortgage company, but a title insurance, home inspector, appraiser, and attorney working for every single transaction?

I don't know. At the risk of incurring the wrath of Lenn and countless other buyer agents, I would say that being the facilitator of a transaction on the buyer's end by bringing all of the parties together to complete a purchase is not the same as being the agents responsible for the sale of the home on the seller's end. Is it work? Absolutely. But that requires more in the way of contacts to different professionals than it does expertise residing in a single person.

That said, I do agree with your analogy to a marriage - I hate it personally when buyers try to "play the field"...our time is too valuable to be wasted in such a fashion.

Feb 17, 2010 11:04 PM
Gina Chirico
Lattimer Realty - Fairfield, NJ
Real Estate Agent - Essex County, New Jersey

David, great post.  Well written, good points and I am definitely going to re-blog it.   

Its funny you write about buyers don't understand how we get paid.  Every so often I'm working with a buyer who's either a friend of mine or was a total stranger that I've built up a really good rapport with and either a few days before closing or on the day of closing they will look at me and do you get paid?  I respond with (again depending on how friendly I've become with them), don't you have my check?  The price on their face is priceless.  I once did it with a not so friendly buyer and he didn't find it funny at all so I now I just stick to friends or buyers with a good sense of humor.

I'm all for mutual respect between agents and their buyers.  I don't have them sign a buyer's agreement but once building a relationship with them (which sometimes doesn't happen on the first outing) I just ask for their loyality and not use another agent.  Explain to them how I work, how "the system" works and I may even use your blog as a basis for an outline and hand it to them.  However, its a double edged sword the day I had two buyers interested in the same property and both wanting to write up offers.  I disclosed it to both parties but somehow I felt like I was the one cheating on them.   Is there much difference in me representing two buyers on the same property or the buyer using 2 different realtors?  I'm still not sure about the answer to that question.

Last but not least, the best is when your friend doesn't tell you that they listed their house for sale and you see it pop up on the mls......

Thanks for this blog!  It's one of the best I've read!!!


Feb 17, 2010 11:53 PM
Ronda Densford
Magnolia Properties - Jacksonville, FL
Realtor - Jacksonville and Northeast Florida

Great post David!  If it's okay, I'm going to re-blog it.  I think that you raise some very valid points. I've worked exclusively with first time buyers for the past 9 months and they really appreciate me taking the time to tell them how the process works!  They are so relieved sometimes, to find out that they don't have to pay me! Wow. That's such basic info I think we sometimes forget that not everyone has a clue about our business. 

I enjoyed Steve's post. Great stuff to get the ol' heart ticking. I went to his site. Oh dear. Let's just say that I'm glad I'm not in his market. Thankfully, yes, I do have a full time real estate attorney that I can call night or day. My Broker has made that possible. And, yes, I do have full time, fully licensed General Contractors that are Home Inspectors, that I can call at a moments notice. And, as luck would have it, my real estate attorney owns the title company that we use. AWESOME!  I love my team.  But, to each his own and I'm sure that Steve's business model works fine for him...

None of my buyers have ever had an affair on me! They treat me with respect and loyalty just like I treat them. I just try to explain the process right up front.  From day one they know what I am going to do for them and they know what I expect in return. Seems to work out great for all of us. I am now working with referrals from the buyers I helped last Fall.  Funny how that works isn't it?

Thanks again for a great post! Congrats on the "feature".

Ronda Densford REALTOR Signature

Feb 18, 2010 01:01 AM
Lyn Sims
RE/MAX Suburban - Schaumburg, IL
Schaumburg Real Estate

Very well done on how agents work and get paid.

Feb 18, 2010 07:20 AM
Ty Lacroix
Envelope Real Estate Brokerage Inc - London, ON

David: To the point and obviously most of the public do not know how we get paid. I am going to re-blog this.



Feb 18, 2010 12:15 PM
Kathy Schowe
California Lifestyle Realty - La Quinta, CA
La Quinta, California 760-333-8886

I love this post--- it pretty much says it all.  We should broadcast it and e-mail it to everyone we know! Kathy

Feb 18, 2010 04:24 PM
Matt Robinson
Professional Investors Guild - Pensacola, FL

David, this post should be required reading for all new buyers.  I know that when my wife and I first started looking for a home 9 years ago, 1 year before I became a realtor, I refused to call a realtor because I didn't want to pay one.  I would rather save the money and find the house on my own.  I had NO CLUE that buying agents were paid by the seller, and thus wasted a lot of my time for new reason.  The bottom line is, most consumers DO NOT understand how we get paid, and so many times they abuse us and our time unknowingly.  Thanks for putting this info out there.

Feb 24, 2010 11:43 PM
David Monsour
Keller Williams Keystone Realty - Gettysburg, PA

Matt- We can't assume people know anything.  Even people who have bought or sold in the past don't know how things are done these days, even if it's the same as it was then.  Life is confusing in this day and age.

Feb 25, 2010 05:18 AM
Beverly of Bev & Bob Meaux
Keller Williams Suburban Realty - West Orange, NJ
Where Buying & Selling Works

I agree with #9, we need NAR to promote more about this. I wrote something similar recently. We have to keep getting the messages out. And don't you just love friends that do that. I even had one that kept calling me for advice about what he should do next. I don't think I really call that a real friend anymomre, though.

Feb 26, 2010 12:20 PM
David Monsour
Keller Williams Keystone Realty - Gettysburg, PA

One of my friends messaged me lately and apologized for being difficult.  He said I read your blog and it made a lot more sense.  I'm showing him a house today actually.

Feb 28, 2010 02:51 AM