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Old 08-11-2018, 11:04 AM
 
Location: Aurora Denveralis
8,220 posts, read 2,878,196 times
Reputation: 12280

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Flat fee listings are overdue, especially in a market like this where houses are often sold in a week to ten days with minimal effort by agent or broker. Having bought and sold a few houses, I appreciate the skills and experience of a good agent when selling a house under normal or difficult circumstances - staging, listing, promoting, open houses, working long hours with potential buyers, etc. However, a large number of properties here sell with little more than an MLS listing and a few turns of the planet; collecting several percent of what have become increasingly inflated prices seems excessive.

Maybe it's time for a more tiered sales system - houses that sell within X days with X amount of standard basic effort get 1-2% or a flat fee. The longer the listing, the more verified effort to find and convince a buyer, the more factors against expedient sale... the higher the fee or percentage.

My agent did an exemplary job finding me a house under tight time and other conditions, but other than some basic prep work over an advance month of my visit, and the paperwork etc., she made about $8k for three half-days of showing me what was on the market. That seems... excessive. But it's also how the system works, for now, and I will happily pay her something similar when I sell this place for the next one (which was the plan all along).
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Old 08-11-2018, 11:34 AM
Status: "Celebrating 30 years as a Broker" (set 27 days ago)
 
Location: Just south of Denver since 1989
10,892 posts, read 29,342,443 times
Reputation: 7095
Flat fee companies have been around for decades. They grow like weeds in booms and disappear just as fast in the busts.

It's been proven over and over people do business with people they know, like and trust. The brokerage name isn't usually much of a factor. Are there people who only do business with a name brand, yes. Far more people do business by referral.

Your agent didn't just make their $$ for 3.5 days of showings. They counseled you, helped develop a negotiation strategy, may be referred a lender/inspector/repair people, wrote offer(s), presented amends to the contract, helped craft an inspection objection & presented you an inspection resolution, maybe had an appraisal issue to resolve, negotiated and planned a closing, or an extension, and waited to get paid by the brokerage how many days from contract to closing?

It's a risk-reward system of pay. The higher the risk, the higher the pay. Did you offer them $2500 cash upfront to do all you hired them to do? No, you went to a third party site to have a referral to some broker who would pay you cash in the end. And they also paid upnest a referral fee at closing. How much did your broker make again?
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Old 08-11-2018, 12:56 PM
 
Location: Aurora Denveralis
8,220 posts, read 2,878,196 times
Reputation: 12280
Quote:
Originally Posted by 2bindenver View Post
Your agent didn't just make their $$ for 3.5 days of showings. They counseled you, helped develop a negotiation strategy, may be referred a lender/inspector/repair people, wrote offer(s), presented amends to the contract, helped craft an inspection objection & presented you an inspection resolution, maybe had an appraisal issue to resolve, negotiated and planned a closing, or an extension, and waited to get paid by the brokerage how many days from contract to closing?

It's a risk-reward system of pay. The higher the risk, the higher the pay.
It's a system that's grown up without much shaping from the market, because the vast majority of homebuyers are utterly clueless about the process and buy between zero and two houses in their life, usually at long intervals.

If it were truly risk/effort/reward, most sales in the Denver area in the last several years would been generously rewarded at about $1000 in agent/broker fees.
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Old 08-11-2018, 02:13 PM
 
411 posts, read 1,147,855 times
Reputation: 313
Very true. The other thing that is mind blowing is: why is it that the higher the price of the home, the higher the compensation is? Except may for an international sale (which requires more prep work and marketing), isn't the effort of selling a 300K home vs a 1 million the same?

The other point made - about houses selling within a couple of hours or a day (in this abnormal market), thus making the effort on both parties minimal, also was pertinent. Thanks.
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Old 08-11-2018, 07:44 PM
Status: "Celebrating 30 years as a Broker" (set 27 days ago)
 
Location: Just south of Denver since 1989
10,892 posts, read 29,342,443 times
Reputation: 7095
I’d be happy to show either of you exactly what you are missing in how real estate brokers are compensated.

Care to share how you are compensated? When does your company’s client get to alter your pay? Do you pay for any tools you use in your work? Do you carry Errors and Ommissions Insurance? Are you licensed by the state?
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Old 08-13-2018, 09:29 AM
 
Location: Frederick, CO
390 posts, read 279,574 times
Reputation: 389
Can I ask why you are only looking for a male agent?
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