Real Estate Agent Commission Reduction/Negotiation Question (sales, broker)

[GPC]

I'll try to be quick with this scenario. I currently have my house listed and was just about to accept an offer (with a buyer that was brought with the agent I listed the house with - so the entire commission will go to her if the deal goes through). A different agent is presenting an increase in another buyer's offer tomorrow. I don't know how much more yet but it'll probably amount to an increase of $3,000. Of course my agent wants me to go with her buyer even though I obviously can get a better price with this counter offer. Here's my question on what I'm thinking of doing - I'm going to tell her I'll go with her buyer at a purchase price of $3,000 less if she'll take a reduction of $3,000 on her commission. Is this a fair and reasonable offer on my part? The way I see it she can either make 2% if I go with the other agent's buyer or 4% minus $3,000 - she still makes a good deal more than the 2% even with the 3K reduction - if she takes the deal I'm offering. Opinions please??? Thanks!!!

[Crookhaven]

Originally Posted by GPC

I'll try to be quick with this scenario. I currently have my house listed and was just about to accept an offer (with a buyer that was brought with the agent I listed the house with - so the entire commission will go to her if the deal goes through). A different agent is presenting an increase in another buyer's offer tomorrow. I don't know how much more yet but it'll probably amount to an increase of $3,000. Of course my agent wants me to go with her buyer even though I obviously can get a better price with this counter offer. Here's my question on what I'm thinking of doing - I'm going to tell her I'll go with her buyer at a purchase price of $3,000 less if she'll take a reduction of $3,000 on her commission. Is this a fair and reasonable offer on my part? The way I see it she can either make 2% if I go with the other agent's buyer or 4% minus $3,000 - she still makes a good deal more than the 2% even with the 3K reduction - if she takes the deal I'm offering. Opinions please??? Thanks!!!

Id go with the higher offer, put her to work and see if she can get another counter.

[GPC]

Originally Posted by Crookhaven

Id go with the higher offer, put her to work and see if she can get another counter.

I agree with you but her buyer came up four times already and said he wouldn't go up anymore. I know people can always say that and not necessarily mean it, but in this case I think the last offer he gave really was his last offer.

[Elke Mariotti]

Originally Posted by GPC

The way I see it she can either make 2% if I go with the other agent's buyer or 4% minus $3,000 - she still makes a good deal more than the 2% even with the 3K reduction - if she takes the deal I'm offering. Opinions please??? Thanks!!!

Don't know what RE company you're using; that can make a difference.
You're assuming of course that she gets the entire commission. More often than not, the gross commission goes to the broker (company) and then it gets split with the agent, often 50/50 or close to it.

Don't know the price, so I'm making assumptions. Math could go something like this example:

sales price $350,000 = 4% commission = $14,000
50/50 split = $7,000 to agent, minus $3,000 = $4,000 but more work, because of dealing with both buyer and seller
2% commission = $7,000, 50/50 split = $3,500 lots more work for $500 gross... If the price is higher, the difference will be greater

That doesn't mean you can't/shouldn't ask... or maybe negotiate something other than $3,000...

Also, I'd like to suggest that you evaluate both offers not only based on price, but also the terms and qualifications of the different buyers. Sometimes a lower price can still be a better/more solid deal than the higher price. Just something to think about...

[Twobeach]

I agree w/ crookheaven,,, I have been trying to sell for 3 years,,make um work for it Baby! this is the GAME!

[GPC]

Originally Posted by Elke Mariotti

Don't know what RE company you're using; that can make a difference.
You're assuming of course that she gets the entire commission. More often than not, the gross commission goes to the broker (company) and then it gets split with the agent, often 50/50 or close to it.

Don't know the price, so I'm making assumptions. Math could go something like this example:

sales price $350,000 = 4% commission = $14,000
50/50 split = $7,000 to agent, minus $3,000 = $4,000 but more work, because of dealing with both buyer and seller
2% commission = $7,000, 50/50 split = $3,500 lots more work for $500 gross... If the price is higher, the difference will be greater

That doesn't mean you can't/shouldn't ask... or maybe negotiate something other than $3,000...

Also, I'd like to suggest that you evaluate both offers not only based on price, but also the terms and qualifications of the different buyers. Sometimes a lower price can still be a better/more solid deal than the higher price. Just something to think about...

The sales price is almost double $350,000. What do you think in this case? I'll have to do some math based on your logic. I understand what you're saying about terms and qualifications but both buyers are about equal. Ugh, I hate this part of the process. I'm not out to screw anyone but I also don't want to be screwed either, kwim? Thanks for all of your insight.

[Elke Mariotti]

Originally Posted by GPC

The sales price is almost double $350,000. What do you think in this case? I'll have to do some math based on your logic. I understand what you're saying about terms and qualifications but both buyers are about equal. Ugh, I hate this part of the process. I'm not out to screw anyone but I also don't want to be screwed either, kwim? Thanks for all of your insight.

Bottom line: you decide on which offer to take - after all, you're the boss! If you find the qualifications/terms are equal, do whatever you feel is best for you...

[DawnSells]

What reasons does your agent give you for wanting you to accept a lower offer?

[Kbinspections]

Originally Posted by Elke Mariotti

Don't know what RE company you're using; that can make a difference.
You're assuming of course that she gets the entire commission. More often than not, the gross commission goes to the broker (company) and then it gets split with the agent, often 50/50 or close to it.

Don't know the price, so I'm making assumptions. Math could go something like this example:

sales price $350,000 = 4% commission = $14,000
50/50 split = $7,000 to agent, minus $3,000 = $4,000 but more work, because of dealing with both buyer and seller
2% commission = $7,000, 50/50 split = $3,500 lots more work for $500 gross... If the price is higher, the difference will be greater

That doesn't mean you can't/shouldn't ask... or maybe negotiate something other than $3,000...

Also, I'd like to suggest that you evaluate both offers not only based on price, but also the terms and qualifications of the different buyers. Sometimes a lower price can still be a better/more solid deal than the higher price. Just something to think about...

Great post!

[Kbinspections]

It never hurts to ask!