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Unread 09-03-2008, 07:17 AM
Status: "Still don't know what sriracha is, and now I hear its passe." (set 26 days ago)
 
Location: N of citrus, S of decent corn
14,562 posts, read 16,204,900 times
Reputation: 22359
Default Bonus for Buyer's Agent?

We asked our agent what we might do to jumpstart our listing. He suggested offering a $1000. bonus to any buyer's agent.
Would this make you try harder to sell my house over others?
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Unread 09-03-2008, 07:58 AM
 
Location: Albany, OR
540 posts, read 1,257,051 times
Reputation: 325
gentlearts, I would suggest that this is a waste of time and money. The idea that I can, as a real estate agent, steer my buyer to a home where there is an incentive for ME both assumes that many of us are somehow able to manipulate our buyers and get them to do something that is to OUR advantage rather than theirs...AND that buyers aren't primarily the ones who tell their agents which houses they want to look at.

In my opinion, both of these assumptions are patently false. Yes, it would certainly be nice to get that extra $1000 (which raises the whole issue of whether or not the agent should disclose that bonus to their client - YIKES! Don't open that can of worms. )
but most agents would not really be "earning" that bonus because (a) they wouldn't (or couldn't) steer a client to your home if it wasn't what they wanted and a good deal for their situation.

My advice - since you are talking about $1000 (not a great deal of money for a price reduction) - offer it in closing costs or put it toward a home warranty or perhaps an allowance of some sort (carpet or paint). Incentivize the buyers themselves, that will get you more traffic.

DaveP
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Unread 09-03-2008, 08:32 AM
 
Location: Barrington
16,098 posts, read 11,316,306 times
Reputation: 5351
I agree with Dave.

Agent bonus incentives make me very uncomfortable and assumes that agents "steer" their clients to homes that pay more. It presumes that an agent can compel someone to buy a specific home.


If I represented a buyer in such a transaction, I would disclose the incentive upfront and rebate it back to the buyer, at closing.
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Unread 09-03-2008, 09:01 AM
 
Location: West Austin
4,695 posts, read 8,562,377 times
Reputation: 3098
Ditto the above.

$1,000 would make no difference with most agents or buyers. Dropping your sales price would be the most effective strategy, in almost all cases, assuming the home is already at the top 10% of the competion with regard to showing condition and easy access. If not, curing the condition and showing issues would be the top of my list of things to do immediately.

Steve
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Unread 09-03-2008, 10:07 AM
 
Location: Olympia
932 posts, read 2,277,026 times
Reputation: 688
Gentlearts,

I'm in agreement with the previous posters on the implications of an agent bonus. A buyer's bonus, or even a price reduction of $1000 is not significant enough to make much of a difference. I'd suggest spending the $1000 on getting an edge on the competition. Get the home professionally staged and photographed, or advertise that the home comes with a one year home warranty for the buyer.

Good luck!

Sandy
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Unread 09-03-2008, 10:20 AM
 
33 posts, read 65,467 times
Reputation: 46
It's never been a factor. A bigger commission is always nice, but I would rather take the "path of least resistance" and get my people into a house they want.

Steering for a bigger paycheck just feels sleazy.
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Unread 09-03-2008, 01:36 PM
 
Location: Salem, OR
10,464 posts, read 15,703,337 times
Reputation: 6223


Buy it, Buy it, Buy it, I say!

This strategy doesn't seem to go over well with buyers...
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Unread 09-03-2008, 03:33 PM
 
Location: DFW - Coppell / Las Colinas
16,640 posts, read 13,846,047 times
Reputation: 14791
Default Money does talk

I would hold off offering the bonus till 30 days out at least. It may not cause a buyer to buy the home but I do feel like it increases the amount of agents who show the house.

We've had 3 homes we've had difficulty selling this year and increased the buyers commission .5 % above the normal commission. Each home went under contract within 60 days after the increase.

Coincidence ? Maybe, but I feel the extra money was some incentive.
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Unread 09-03-2008, 08:17 PM
 
Location: Fayetteville, NC
1,433 posts, read 2,535,975 times
Reputation: 1376
North Carolina is requiring written disclosure to buyers of any bonus or special compensation starting 1 Oct. Supposedly we will have to notifiy the buyers before we show them the house.
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Unread 09-04-2008, 07:08 AM
 
Location: Barrington
16,098 posts, read 11,316,306 times
Reputation: 5351
Quote:
Originally Posted by Rakin View Post
I would hold off offering the bonus till 30 days out at least. It may not cause a buyer to buy the home but I do feel like it increases the amount of agents who show the house.

We've had 3 homes we've had difficulty selling this year and increased the buyers commission .5 % above the normal commission. Each home went under contract within 60 days after the increase.

Coincidence ? Maybe, but I feel the extra money was some incentive.
No doubt that homes offering better compensation get shown more than others. Relo homes have been doing this for years.

At the end of the day however, it has to be the right home, at the right price, for the right buyer.
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