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Looking for a civil discussion, no attacks either way, please.
After reading many posts about the general public's outlook on Agency commissions, what's your feelings on a fair number (both sides as if you were the seller). And why?
Agents state your facts on why the commission is based as it is. And your personal thoughts of the future of the commission percentage?
Most people think that the agent gets to keep all the commission - everything the seller pays at closing. They don't realize that it costs money to be listed on the MLS, to have a sign in front of the home, to have a lockbox on the door, to be advertised in the media and on the internet. Who pays for it - either the agent or his company (and if it's the agent's company, the company takes a bigger cut of the agent's commission.) The agent has a lot of expenses also - licensing fees, insurance, MLS fees, fees to all the websites he advertises his listings on, and in many cases fees for office space and use of materials. Remember, if your home doesn't sell, the agent doesn't get paid - but he still has all the expenses.
Flat fee for the order taker "agents" There is a market for them and I support their business model.
7%+ for a well trained, well qualified agent that saves their client time, money, mistakes, and liability or makes their client money and gives intelligent, informed advice.
In the end the market determines the value of each service provider.
Location: Moved to town. Miss 'my' woods and critters.
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After a discussion concerning this matter with agents in my office, we agree that 6% is a 'fair' rate for residential listings. However, the commission is always negotiable and never set in stone. This business is highly competitive. Therefore each agent and company must strive to provide their 'clients' with the maximum amount of service in order to justify 'any' commission. As has been noted, we do so much 'work' behind the scene that sellers and buyers are not aware of at the time if ever.
Our work starts peior to even taking a listing with the preperation of the presentation. And it is non stop from then on with each and every listing. We do the 'job' that most sellers, if not all, really do not want to do nor do they always have the necessary skills required to market, qualify potential buyers, and be available for showings.
We take the burden of showing properties from the seller. How many sellers want to answer all of the 'phone calls that come in, how many want to open their door to strangers? How many sellers want to design ads, flyers, post cards and then deliver or mail them? And this is just for starters.
We do these chores because this is our 'job'. And, IF the property sells, we then get paid. But not until. How many would be willing to put in unknown hours for unknown if ever paychecks? Haven't even mentioned vehicle expense, electronic equipment and all of the other 'goodies' that we must have Oh, almost forgot: how many hours are spent 'holding the sale together? And dealing with surveyors, bankers, lenders, title companies, utility companies, and the list goes on.
We go into this business, hopefully, because we like homes, farms, property in general and working with people. If you haven't been there (here), then you may not understand why the commission is where it may be.
After a discussion concerning this matter with agents in my office, we agree that 6% is a 'fair' rate for residential listings. However, the commission is always negotiable and never set in stone. This business is highly competitive. Therefore each agent and company must strive to provide their 'clients' with the maximum amount of service in order to justify 'any' commission. As has been noted, we do so much 'work' behind the scene that sellers and buyers are not aware of at the time if ever.
Our work starts peior to even taking a listing with the preperation of the presentation. And it is non stop from then on with each and every listing. We do the 'job' that most sellers, if not all, really do not want to do nor do they always have the necessary skills required to market, qualify potential buyers, and be available for showings.
We take the burden of showing properties from the seller. How many sellers want to answer all of the 'phone calls that come in, how many want to open their door to strangers? How many sellers want to design ads, flyers, post cards and then deliver or mail them? And this is just for starters.
We do these chores because this is our 'job'. And, IF the property sells, we then get paid. But not until. How many would be willing to put in unknown hours for unknown if ever paychecks? Haven't even mentioned vehicle expense, electronic equipment and all of the other 'goodies' that we must have Oh, almost forgot: how many hours are spent 'holding the sale together? And dealing with surveyors, bankers, lenders, title companies, utility companies, and the list goes on.
We go into this business, hopefully, because we like homes, farms, property in general and working with people. If you haven't been there (here), then you may not understand why the commission is where it may be.
Some excellet points Northwood, plus the value of being away from the family.
AS a seller (this is our third home) - I do not mind paying a commission - but when you pay 6% and it always feels like no one is doing anything except placing the sign on the lawn and listing on MLS -
understand I am not attacking - but questioning for Northwoods Voyager -
How do we as sellers know you are doing all the above - flyers, telephone calls
I have (outside of the flyer on my post) - never know what is going on in the background - I have asked my agent - but don't really get clear answers...
SO yes, I would like to know what goes on in the background..
who makes the decision to put an ad in the newspaper? who decides to do an open house? how do I know he has called people or is looking for a buyer for our home - or just waiting for that magical telephone call.....
I respect your positions - but sure would like to have some answers>>>
I guess I have to say the bulk of the time I'm not infront of my sellers or doing work to make sure a deal goes through, I am networking. I firmly beleive any brokerage business, whether it be real estate or yatchs, is about who and how many people you know. Especially in this market where there are a million agents representing 5 million properties, the agents i'm in front of all the time know me, like working with me, know the homes I represent are priced fairly and are easy to show.
90% of the time your house sells through another agent, afterall agents represent the bulk of the qualified buyers out there. The other 10% of the time is spent posting your home all over the net, calling potential buyers, calling people in your neighborhood to see if they'd like to choose their new neighbor, and following up on leads generated by internet and print advertising.
The marketing part is the easy part, it's when you get your first offer is where my real work begins.
As far as who makes the decisions on newpaper ads and open houses, you'd have to ask the individual agent. Some brokerages provide all marketing for the agent and the agent themselves controls nothing. Other brokerages leave everything on the agents table to do or not do, and of course some are in between the two extremes. Open houses you can always request as a seller, but I almost always refuse to do them nowadays. In a normal market they may be worth doing, but in this market I'll be lucky to have 1 couple come through even with all the advertising in the world. It is a better use of my 3-4 hours I'd waste in an open house being out in the field networking and actively generating buyer leads for your home, through agents and the direct public.
Thanks Greg
My next question - then for you - is how many people would you say actually call the realtor directly - by driving by- taking one of the flyers -
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Oh, almost forgot: how many hours are spent 'holding the sale together? And dealing with surveyors, bankers, lenders, title companies, utility companies, and the list goes on.
