Quote:
Originally Posted by TarHeelNick
Psshh...
Price for the consumer is independent of split with cooperating firm!
Cheapskate!  |
Ooooo.... Commission talk! What a fun way to start the day!
I was actually serious. You stepped in something you should very proactively avoid, along with a thought pattern you should avoid and delete from internalization.
Proper training is in order, as your post implies you are under the influence of Old Dog mentality rooted decades in the past.
Implying any specific commission split or rate as desired, expected, standard, etc, is verging into implications of connotations of price fixing, and possibly restraint of trade.
You need to consider very carefully the validity and ethic behind input you are receiving from mentors and leadership.
Even moreso if you are going to publicly criticize other firms' operations, and particularly judge them for commission rates that don't meet your standard.
It is a shame that many firms and brokers with experience dating prior to DOJ persecution still teach old dog price-fixing connotations as a legitimate business posture.
When the commission is lower than you specify as "Expected," of course, you have a buyers' agency agreement wherein the buyer agrees to make up any shortfall; where you clearly explained that option, right?
But, let's play the math game anyway. JFF.
Currently 32% of resales in Durham County and 33% in City of Durham split 2.4% to a Buyers Agent.
139/433 and 103/403, respectively.
There is actually one at 1% this morning.
1. So, I list a home in Durham at 4.6% total fee and the Buyer's Agent receives 2.4% commission.
2. An agent lists an identical house in Durham at 6% commission, and the splits are 50/50, 3% each agent.
3. An agent lists an identical house in Raleigh at 6% commission, and the splits are 60/40, 3.6% to listing side, 2.4% to buyers side.
Discussion and rhetorical questions:
Would you or anyone you know decline to show the Durham listing with a 2.4% co-broke, because of the co-broke amount?
Would you, or anyone you know, label the 4.6% fee as "Discount?"
Would you, or anyone you know, label the 4.6% fee as "Discount," and/or bleat out one of the classic disingenuous banalities like:
- "You won't get full service from a discounter."
- "If he gives away his money that easily, think how easily he will give away your money."
- "You get what you pay for!"
- "You know, I don't get all that money. It is split four ways, and this is an expensive business!"
- "I have to pay for gas!" LOL
Would you or anyone you know say,
"But, you are leaving money on the table?"
(Uhhh.... That is the consumers' money, FWIW. It doesn't fall out of the sky, but off the table of clients we claim to serve as fiduciaries.)
Am I cheap for finding an agreeable listing commission rate that is less than offered to a buyers agent?
(BTW, I would never advertise a rate that does not include the co-broke commission. That is misleading, which, akin to the above list of banalities, would be more saddening than "Cheapskate.")
Am I cheap for accepting a fee that provides me with a workable profit margin, while leaving 1.4% of purchase price in my trusting clients' pockets?
Am I cheap for being happy with a 2.4% BA split even though a listing agent in a rampant sellers market takes 3.6%?
Of course, I keep non-value-adding corporate fat out of my model, so I can be as profitable as a great many people who perhaps inflate expenses and bloviate about commissions.
I.e., on a $350,000 sale, that is $4900 to the people who trusted me as a fiduciary. On a $700,000 sale, $9800. Those numbers are real money to people who have it.
Tangentially, am I cheap for charging less than 6%, or for accepting less than a 50/50 split on that Raleigh listing?
What fun!
More Coffee!
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