Why Do Sellers Still List with Agents Charging 6% (or even 5%)?
This is a continually perplexing question for us, and one which probably has several answers. First, we think many sellers don’t realize that commissions are not fixed. The big real estate companies spend a lot of effort training their agents to focus on the service-side of their pitch and not on their fees. To support their rigid pricing structure, many agents will argue that if you pay less, you will get less. Its all a smokescreen, of course. There is no shortage of unhappy sellers who paid 6%.
Loyalty is another reason, as sellers will often return to the agents who helped them buy their house initially. And although we certainly cherish the same long-term relationship with our former clients, we continue to work towards having sellers take a closer look at a comparable service that will cost thousands of dollars less.
Brett Weinstein
The Payne Group at Keller Williams Success Realty - Panama City, FL
Panama City Real Estate
Sellers will pay for service. I do some as high a 10%. There is no smokescreen. You will get what you pay for inmy opinion. Sellers want to sell and I get them sold, they are very happy with my service.
Nov 01, 2007 06:15 AM
Tiverton, RI
Rhode Island full service real estate firm
I am not sure that I can agree that service is the same with all agencies that charge less... many instances, in our experience, show that in point of fact they are not equal in service provided. I am also sure that there is at least an equal number of unhappy clients who paid less. In most instances one gets what one pays for.
That said, there is nothing to say that one wont get an equal level of service for less, just that the odds are also, well, less.
Nov 01, 2007 06:21 AM
16 Sunview Blvd - Fort Myers Beach, FL
Fort Myers Beach Realtor, Fort Myers Beach Agent - Homes & Condos
Brett, If you are trying to start a discussion it would help if you didn't alienate those who happen to disagree with you. Basing conclusions on blatant distortions ( ...spend a lot of effort training their agents to focus on the service-side of their pitch and not on their fees. To support their rigid pricing structure, many agents will argue that if you pay less, you will get less. Its all a smokescreen, of course. ) may be why so many sellers stay away from the less professional among us. Please rethink your approach to the AR community and respect the agents who have chosen various business models.
Nov 01, 2007 06:26 AM
First Realty Company - Crossville, TN
The last few listings that I have received have come from sellers who had their homes listed with a flat fee company.. They where very disappointed in the amount of advertising and communication.
Nov 01, 2007 06:29 AM
Florida Future Realty Inc. - Cape Coral, FL
Scott Slocum & Associates 239-222-4800, Cape Coral
The last time that I checked you can discuss the fee that you charge for your services however it is a violation of law to discuss what others charge for commission and stating that "everyone else charges X%, Y%, or Z% is a violation of the FEDERAL TRADE COMMISSION laws. Please follow this link for any further followup FYI. http://www.ftc.gov/
Nov 01, 2007 07:05 AM
Florida Future Realty, Inc. - Cape Coral, FL
Cape Coral Real Estate Broker, FloridaFutureAgents
That is true. And we are all free to charge whatever we want. Whether it is x, x-y or x+y. It is great that consumers have the chance to interview agents, negotiate fees and decide which option is right for them. Be careful discussing specific commissions though.
Nov 01, 2007 07:08 AM
Keith Stoller Tax & Business Solutions - Bakersfield, CA
If there is a business model that creates economic efficiency that allows for reduced commissions while still turning a profit to the point where an agent's family doesn't have to stand in line at the food bank and the service is comparable to or above what can traditionally be found in the market then something like this can be a good thing. Usually, people are offering the same for less in the hopes of jacking up volume to compensate. This generally leads to poorer service. Moreover, with fewer resources for advertising dollars, agents will be a lot more conservative in advertising. Again, if there is a more effective model that preserves service and delivers comparable results I'm all for it.
Nov 01, 2007 07:45 AM
Coldwell Banker - Sacramento, CA
916-342-1372 / DRE# 01706589 Sacramento, CA
Hmm...I generally work on a high quality basis, not a high quantity basis...
Nov 01, 2007 08:30 AM
Coldwell Banker - Sacramento, CA
916-342-1372 / DRE# 01706589 Sacramento, CA
Hmm...I generally work on a high quality basis, not a high quantity basis...
Nov 01, 2007 08:31 AM
The Payne Group at Keller Williams Success Realty - Panama City, FL
Panama City Real Estate
I believe that if we charge a higher commission, we have to back it up with the service to justify it. Our team maintains constant communication with our sellers which is the biggest complaint that we hear when we go on listing appointments, especially expired listings. GREAT SERVICE is what the customers want and they will pay for it.
I have no problem with the business model that works from lower commissions, my business model is based on customer service standards and the sellers NEVER have a problem paying me what I am worth.
Nov 02, 2007 03:10 AM
Comments(10)