Home Buyers Don't Always Know the Sacrifices Their Buyer's Agent Makes

By
Real Estate Agent with RE/MAX Gold DRE #00697006

sacramento short sale agentSome people don't have a very high opinion of real estate agents. If you ask them what they think about real estate agents, they might say that agents are money-grabbing, money-hungry thieves who are no better than a snake in the grass. I say those people are giving agents too much credit. Agents aren't nearly as slick as the public may perceive.

Most agents are doing their best to eke out an honest living and take care of their clients so they'll get future referrals. End of story. There's really not much more to it.

I was explaining to my sister who is visiting Sacramento from Minneapolis how new agents get paid. How they might end up with 50% of 50% less miscellaneous fees and then overhead, which times 12 is less annually than a clerk earns at The Home Depot. How much easier it is to earn more money when an agent has earned a higher split at the brokerage, but in this down economy, some top producers have slipped in the ranks. I'm happy to say that my production has not suffered in the least; in fact, it's grown, but I'm not the norm. I'm a Sacramento short sale agent. We're some of the few agents who have found a niche and a way to survive the down market in Sacramento.

In any case, my sister was astonished. She has no idea how the real estate business works from the inside. I imagine most people don't know. Like the buyer who is closing on a short sale in Elk Grove next week. That buyer's agent would have earned a much higher commission percentage if that buyer closed this week. That's a Wachovia short sale for ya. But the agent did not want the buyer to spend the money to order an appraisal until after the home inspection. And the home inspection could not be completed in enough time. So the agent willingly gave up part of her commission to protect her buyer. Does the buyer know that? I doubt it.

Or the buyer's agent who represents the buyers for a short sale in Rocklin. The second lender on that short sale demanded a few thousand more and refused to let the seller pay it. Sometimes short sale banks make unreasonable demands and shoot arrows into the transaction, just to shake it up a little, just to keep us all dancing on our toes. That agent stepped up to the plate and offered to participate by contributing part of his commission to make the transaction feasible for his clients. He didn't have to. He could have sold them a home nearly identical a few blocks down at the same price and earned more.

It's often astonishing news for clients to learn that their agent cares about them. It shouldn't be.

Photo: Big Stock Photo

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elizabeth weintraub

 

 

Weintraub and Wallace Realtors

 

 

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Elizabeth Weintraub is co-partner of Weintraub & Wallace Team of Top Producing Realtors, an author, home buying expert at The Balance, a Land Park resident, and a veteran real estate agent who specializes in older, classic homes in Land Park, Curtis Park, Midtown, Carmichael and East Sacramento, as well as tract homes in Elk Grove, Natomas, Roseville and Lincoln. Call Elizabeth Weintraub at 916.233.6759. Put our combined 80 years of real estate experience to work for you. Broker-Associate at RE/MAX Gold. DRE License # 00697006.

Photo: Unless otherwise noted in this blog, the photo is copyrighted by Big Stock Photo and used with permission.The views expressed herein are Weintraub's personal views and do not reflect the views of RE/MAX Gold. Disclaimer: If this post contains a listing, information is deemed reliable as of the date it was written. After that date, the listing may be sold, listed by another brokerage, canceled, pending or taken temporarily off the market, and the price could change without notice; it could blow up, explode or vanish. To find out the present status of any listing, please go to elizabethweintraub.com.

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Rainmaker
317,417
Susan Brown
Keller Williams NE, Kingwood Texas (Humble & Atascocita too) - Kingwood, TX

Elizabeth, Very accurate post on just how it works on the buying side.  I know that sometimes general opinion is that little work is done and a big check is handed out.  We know the truth!

Nov 30, 2010 02:57 AM #1
Rainmaker
170,272
Robert J. Russell
Robert J Russell Companies - Dallas, TX
IRES, ICREA, GMA, LAS, LUTCF, Sales Trainer

and some buyers think that all we do is drive around like a Taxi showing houses then get paid the BIG BUCKS !

Nov 30, 2010 03:00 AM #2
Ambassador
1,540,892
William Johnson
Retired - La Jolla, CA
Retired Real Estate Professional

Good Morning Elizabeth,

There is so much in the " untold" story of how this business actually works and that would include both it's failings as well as successes. Any one client or customer is only a small part of the total picture. And sadly, I am not all that sure the public cares that much to either have a clear understanding or to see it changed. I applaud you for this post and will of course suggest this so others may engage in the discussion.

Nov 30, 2010 03:57 AM #3
Rainmaker
97,495
Kathie Burby
Coldwell Banker Mother Lode Real Estate - Sonora, CA
REALTOR, SFR, Tuolumne County Real Estate Guide

Elizabeth - You are so in your description of public opinion towards real estate agents. We often hear ourselves compared to used car salesman (and not in a good way). I always go the extra mile whether it is for a buyer or a seller. My clients do recognize the hard work I put into a transaction but often think we have huge pay checks.  A client once asked me how I get paid, after explaining the commission split between listing and selling brokerages and then between agent and broker - he offered to give me gas money! (I politely declined.) He was shocked that we work so hard for our commission. He was under the impression that everyone in the transaction made 6% percent!

Nov 30, 2010 04:13 AM #4
Rainmaker
601,332
Donne Knudsen
Los Angeles & Ventura Counties in CA - Simi Valley, CA
CalState Realty Services

Elizabeth - Your sister would probably laugh at what a hard-working, producing MLO makes.  While this year my production has been better than last year (and 2009 was better than 2008), my numbers are still down from where they were a few years ago.  Glad to hear that you're doing better though.

Nov 30, 2010 04:42 AM #5
Rainmaker
2,782,099
Kathleen Daniels
KD Realty - 408.972.1822 - San Jose, CA
San Jose Homes for Sale-Probate & Trust Specialist

Elizabeth, I’m a broker working my ass of in real estate. I’ve only been in the business for a little over 8 years … and I have to say I have met and worked with many “money-grabbing, money-hungry thieves who are no better than a snake in the grass.” Believe me, the agents are slick and know perfectly well they are throwing the clients under the bus and don’t care one rats-patuttie about them. Thankfully the good far out-weight the other. I enjoy reading your posts. Thank you.

Nov 30, 2010 05:05 AM #6
Rainmaker
178,807
Steve Mun
Keller Williams Silicon Valley - Santa Clara, CA
Silicon Valley Realtor

Absolutely true Elizabeth.

Some clients have no idea what agents have to do to get deals closed.  Unfortunately, it is the less experienced agents without a deep reserve of clients who have to make the bigger sacrifices to make sure a deal closes.  

But I do agree with you that the majority of agents are just trying to make a living.  It's often the few bad apples that paint the image of the money grubbing, uncaring agents.  Agents with those traits cannot last long in this business as referral business will dry up.  

Keep up the good work.  I enjoyed this entry very much. 

Nov 30, 2010 11:42 AM #7
Rainmaker
472,839
Colleen Fischesser Northwest Property Shop
RE/MAX Advantage | Managing Broker - Chelan, WA
A Tradition of Trust in the Pacific NW since 1990!

I bet you're right....that the buyer had no idea. Honestly, if most buyer or sellers could just walk a day or two in our shoes they would probably be more appreciative of what we do. But if they don't know all that's involved, they aren't going to have a clue

Nov 30, 2010 12:10 PM #8
Rainer
59,603
Krista Fuchs
Prudential Fox & Roach - Exton, PA
Chester County Realtor - (484) 459-8025 - Home Buying and Selling

I've come to tell my Sellers how everything is split because I've had so many object to commission percentages.  Once they realize how everything gets divided and what my expenses are they usually feel bad for me!

Nov 30, 2010 12:32 PM #9
Rainmaker
2,189,557
Elizabeth Weintraub Sacramento Realtor Top 1%
RE/MAX Gold - Sacramento, CA
Put 40 years of experience to work for you

My sister used to work for the post office. 'Nuff said.

Nov 30, 2010 01:04 PM #10
Ambassador
3,084,500
Chris Ann Cleland
Long and Foster REALTORS®, Gainesville, VA - Bristow, VA
Associate Broker, Bristow, VA

Elizabeth:  I'm sure that some buyers would be amazed by what their agents do for them.  And you say, they shouldn't be. 

Nov 30, 2010 01:17 PM #11
Rainmaker
84,472
Simon Mills
Mills Realty - Toluca Lake, CA

This is an inheritant problem with the current commission structure.  Unless we educate the consumer they will always think a commission salesperson earns too much money.

Nov 30, 2010 04:29 PM #12
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