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Here in MT they can represent themselves but often pay a small fee to a coworker to do the paperwork so as to avoid any apperance conflict of interest which I think is a good idea...
You wouldn't be incorrect wanting to offer less on the home owned by an agent. You as a buyer, have the goal of getting the home for as little as possible. It doesn't matter to you what the seller has to pay in commissions or how much they are pocketing, just that you get the best deal possible.
Keep in mind though, the seller, whether paying 1% 2% 6% 9% or 20% in commission, has a goal of selling their property for as much as the market will bear. Just because they may net more than their neighbor when selling at market price, doesn't mean they will be willing to sell for less than market just because they aren't paying what their neighbor is in commission.
Quote:
Originally Posted by Brandon Hoffman
You are incorrect. Should a home being sold by a flat fee company be discounted? Should a FSBO be discounted by x%? A home is worth what the buyer is willing to pay and commission has nothing to do with that.
Thanks for those replys Greg and Brandon. I see what you are saying. I have always been a bit confused by this scenerio but it makes more sense to me now. Thanks!
So if an Agent is selling his own home and has his house listed at exactly the same price of identical house listed through another brokerage that typically collects 3.5% commission from the seller would a buyer be off base to make an offer for the agent owned home starting at 3.5% less of the asking price right off the bat since the agent owns the home and isn't paying a selling agent 3.5%?
Example:
Home A is owned by agent and listed at $200K
Home B is identical to home A but owned by a regular joe and listed at $200K through full service RE agency with agreed 6% comission split between buyer and sellers agent.
A full price offer to Home A would come out as $200K - 2.5% commission to buyer's agent, but the seller (Who is an agent) pockets the rest since he is not paying a selling agent so $200K - (2.5%) or $5K = $195K in sellers pocket after the sale.
A full price offer for Home B would come out as $200K - 6% commission (2.5%to buyers agent and 3.5% to sellers agent) = $200K- (6%) or $12K = $188K in sellers pocket after the sale.
Is it incorrect to think that the home owned by the agent should be discounted by 3.5% or $7K in this case?
wow that is kinda lame to think that because of this mans job he shouldn't recieve full asking price for his home
ok that's like saying 2 little girls have lemonade stands
one girl has to buy her lemons
and the other has lemon trees
should the girl who owns the tree charge less for her lemonade?????
no because fresh lemons make a better drink
so I guess you are saying that because I personally am an agent AND an interior designer that I should take a whole BOATLOAD off the price of my home because
1- I didn't need an agent
2- I didn't need to have it professionally staged
get real buddy
stop nickel and diming people
if you want the house
buy it
wow that is kinda lame to think that because of this mans job he shouldn't recieve full asking price for his home
ok that's like saying 2 little girls have lemonade stands
one girl has to buy her lemons
and the other has lemon trees
should the girl who owns the tree charge less for her lemonade?????
no because fresh lemons make a better drink
so I guess you are saying that because I personally am an agent AND an interior designer that I should take a whole BOATLOAD off the price of my home because
1- I didn't need an agent
2- I didn't need to have it professionally staged
get real buddy
stop nickel and diming people
if you want the house
buy it
dncngrl1964,
I posed a hypotheical question to help me understand what if any special considerations could be at play when an agent sells their own home. Greg and Brandon did a good job of pointing out the error in my logic and they did it with good candor I might add. While I appreciate you taking the time to respond to my question, I find your response a bit crass and lame in itself.
Mine was an honest question that I did not know the answer to. I wasn't "saying" or concluding anything. I was asking a question and a hypothetical question at that.
No need to get all in a huff and respond with a negative tone.
Last edited by North_Raleigh_Guy; 11-04-2007 at 09:25 AM..
I posed a hypotheical question to help me understand what if any special considerations could be at play when an agent sells their own home. Greg and Brandon did a good job of pointing out the error in my logic and they did it with good candor I might add. While I appreciate you taking the time to respond to my question, I find your response a bit crass and lame in itself.
Mine was an honest question that I did not know the answer to. I wasn't "saying" or concluding anything. I was asking a question and a hypothetical question at that.
No need to get all in a huff and respond with a negative tone.
I'll vouch for NRG.
He is a student, not a critic or cheapskate, IMO.
He has a great history of that on C-D.
ok that's like saying 2 little girls have lemonade stands
one girl has to buy her lemons
and the other has lemon trees
should the girl who owns the tree charge less for her lemonade?????
no because fresh lemons make a better drink
Location: Mokelumne Hill, CA & El Pescadero, BCS MX.
6,957 posts, read 22,311,234 times
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In CA the answer is yes and yes as well. In my real estate company, I won't allow an agent to represent themselves, I take over for them, buying or selling. I'm actually letting a salesperson go who violated this company policy. Oh and by the way they also shorted me commission dollars.
So if an Agent is selling his own home and has his house listed at exactly the same price of identical house listed through another brokerage that typically collects 3.5% commission from the seller would a buyer be off base to make an offer for the agent owned home starting at 3.5% less of the asking price right off the bat since the agent owns the home and isn't paying a selling agent 3.5%?
Example:
Home A is owned by agent and listed at $200K
Home B is identical to home A but owned by a regular joe and listed at $200K through full service RE agency with agreed 6% comission split between buyer and sellers agent.
A full price offer to Home A would come out as $200K - 2.5% commission to buyer's agent, but the seller (Who is an agent) pockets the rest since he is not paying a selling agent so $200K - (2.5%) or $5K = $195K in sellers pocket after the sale.
A full price offer for Home B would come out as $200K - 6% commission (2.5%to buyers agent and 3.5% to sellers agent) = $200K- (6%) or $12K = $188K in sellers pocket after the sale.
Is it incorrect to think that the home owned by the agent should be discounted by 3.5% or $7K in this case?
I hope this isn't crass or lame --- I think dncngrl1964 meant that lemon trees aren't cheap and lemons don't grow on their own.
What you’re doing, is asking the agent to work for free. Think of it this way - if I work for a car dealer and sell my own car, then I should get less than I would for any other car, just because I sell cars? Why don’t I just let one of the other car salespeople on the lot sell it for me? At least they’ll get paid.
This also applies to FSBOs by the way.
If I sold my car on my own, then I would get more money for my effort. Most people that sell their own cars, do it in order to get more than what the car dealer would give them. Sure I’m getting more money, but I have to “SELL IT MYSELF”. So, when you sell your own car, you’re time and effort is worth something. But, when you sell your own house, your time and effort is not?
I don’t see why FSBOs are supposed to be cheaper. If it is cheaper, is it because the seller can’t get the price that an agent can get or the seller would rather do all this work for free and not pay an agent because he thinks it will sell faster and easier for less? Well if he’s selling it at a discount of more than what he thinks he’d pay in a commission, then what is he saving?
Did that make sense?
I would say that its incorrect to assume that a home owned by an agent should be discounted. Its worth what its worth, and nobody would know more about what its worth than an agent. I doubt he wants to sell his house for less because he's an agent, or work for free.
You can always offer less and see what the seller comes back with, but keep in mind that most agents work for a brokerage, and a such, the commission goes to the broker who will take a cut. The agent may get a discount when it's his own house, but in most cases they don't get to keep the entire commission.
Fannie Mae recently changed its policy of refusing to pay a buyer's broker commission if buyer's agent is also the buyer. Chances are they got their butts sued off for discriminatory practices. "Bringing a buyer who is ready, willing, and able' to buy and is pre-approved for financing, or paying in cash ,SHOULD NOT BE DISCRIMINATED AGAINST DUE TO THEIR OCCUPATION.
NOW THEY PAY THE BUYER'S BROKER COMMISSION EACH AND EVERY TIME A BUYER IS ALSO A BROKER OR AGENT, AS LONG AS THE AGENT OR BROKER DISCLOSES UP FRONT PER ETHICS GUIDELINES.... IT IS FANNIE MAE'S CURRENT POLICY.
BROKERS! STAND UP FOR YOURSELVES! IF YOU ARE A PRINCIPAL AND ALSO ELECT TO REPRESENT YOURSELF AS A BUYER, AS LONG AS YOU DISCLOSE, AND AS LONG AS YOU DON'T HAVE THE LISTING AS WELL, SHOULD FIGHT DISCRIMINATION DUE TO OCCUPATION!!
There's no 'may participate'. It's your RIGHT BY DEFINITION IN THE LISTING AGREEMENT!
Hello??? REO lenders who refuse to pay a buyer's broker commission if the buyer is also acting as their own agent are just plain GREEDY and taking advantage. DON'T LET THEM~ BOYCOTT THE UNFAIR BUSINESS PRACTICES OF THESE SELLERS UNTIL THEY CONFORM TO FANNIE MAE POLICY.
ANYONE OUT THERE GET TURNED DOWN REGARDING COLLECTING YOUR COMMISSION WHEN MAKING OFFERS ON REO'S? I WANT TO HEAR FROM YOU. NAME NAMES, LET OTHERS KNOW ABOUT DISCRIMINATORY BUSINESS PRACTICES BASED ON GREED.
Last edited by brokerbuyer1111; 08-24-2010 at 08:21 PM..
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You lost me at wow
