How to politely decline sellers’ requests to cut commission etc? (RE market, contract)
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We are in a sellers market right now and seems like every week some new new “reduced fee” agency opens up shop. Sellers are catching on & we are encountering more requests to cut our commission. Standard here is 6 split 3/3. If we do cut commission (like in a buy/sell situation), we never cut the 3% to the buyer. We only cut our side.
Likewise, we are encountering more people who want us to provide more services, or pay for them. Pay for a stager, pay to have the house cleaned, pay to have flower beds weeded & mulched. Today I got a call from a buyer client of mine (house closed last week) who asked me to have someone come scoop dog poop out of the backyard that was left by seller’s dogs. I **** you not! ������. I already paid to have the house professionally cleaned for them because the sellers left the house pretty gross and I felt badly for the buyers. But it seems like no good deed goes unpunished! Try to be nice & then they want to take advantage of you. So how do you say “no” to requests? And what’s the craziest thing a client has tried to get you to pay for?
We are in a sellers market right now and seems like every week some new new “reduced fee” agency opens up shop. Sellers are catching on & we are encountering more requests to cut our commission. Standard here is 6 split 3/3. If we do cut commission (like in a buy/sell situation), we never cut the 3% to the buyer. We only cut our side.
...
If you are affiliated with a brokerage or a broker stupid enough to state that there is a standard commission of any rate, leave immediately and go to work for an ethical, modern brokerage that will train you properly.
Location: Sarasota/ Bradenton - University Pkwy area
4,615 posts, read 7,537,235 times
Reputation: 6036
Quote:
Originally Posted by MikeJaquish
If you are affiliated with a brokerage or a broker stupid enough to state that there is a standard commission of any rate, leave immediately and go to work for an ethical, modern brokerage that will train you properly.
Unbelievable. Just unbelievable.
My thoughts exactly. Agent apparently has no clue about antitrust laws.
As to cutting commission.....
When someone challenges your commission, it means that you haven’t demonstrated the value of the services that you provide. Sellers want to know what's in it for them -- what do YOU bring to the table that the other agent doesn't. Explain to them why your services are worth the commission you are quoting.
To compete on price you will find yourself having to continue to underbid other agents who are playing the same game. You'll end up working for smaller and smaller commissions and dealing with more difficult customers. Yes, difficult -- because they have already won their negotiation on commission with you up front. So they will more likely calculate that you will give in on other negotiations with them during the listing/sale process.
I will not pay 6%, no. It’s way too much money for way too little work. That does NOT mean I think 6% is “too high,” it means you’re not getting 6% on MY properties. I think if you’re trying to sell a $150,000 townhouse, 6% is way too low, the agent works so hard to sell this thing and ends up with a pathetic amount of money. But when I sold a $735,000 condo in a hot market in the best area of town, 5% is a great rate. Each getting 2.5% so you’re talking about $18,000 or so. I gave my agent on my $550,000 house this time around 5.5% to divide as she wanted, and she sold it in 24 days or so. Interesting scenario this time as the buyer didn’t want an agent - kind of a weird dude - and so to make the deal work, because I didn’t agree to pay buyers closing costs, my agent said she’d pay $8,000 toward the closing costs as she’s making the whole 5.5%. Still works out well for everyone.
If I sold a house for $3 million I’m not even paying 5%, no thanks, you’re not making an annual salary listing one house no.
We are in a sellers market right now and seems like every week some new new “reduced fee” agency opens up shop. Sellers are catching on & we are encountering more requests to cut our commission. Standard here is 6 split 3/3. If we do cut commission (like in a buy/sell situation), we never cut the 3% to the buyer. We only cut our side.
Likewise, we are encountering more people who want us to provide more services, or pay for them. Pay for a stager, pay to have the house cleaned, pay to have flower beds weeded & mulched. Today I got a call from a buyer client of mine (house closed last week) who asked me to have someone come scoop dog poop out of the backyard that was left by seller’s dogs. I **** you not! ������. I already paid to have the house professionally cleaned for them because the sellers left the house pretty gross and I felt badly for the buyers. But it seems like no good deed goes unpunished! Try to be nice & then they want to take advantage of you. So how do you say “no” to requests? And what’s the craziest thing a client has tried to get you to pay for?
Re buyer...you do a walk thru and have buyer sign a walk thru acceptance form after walk thru and on way to closing. Then you learn the word "no...i'm sorry, i don't do that but here is a phone number of pooper scooper company"
If they object during walk thru, as their agent, you call listing agent andctell them property was not left in acceptable condition and buyers will close once those items are taken care of.
In the future, if sellers seem to be slobs or have pets, write into contract that sellers will have home professionally cleaned and all dog poop picked up by closing.
You need to learn how to build value into what you offer as a listing agent. Surely you can justify why your services are worth 6 percent vs the discount brokerages. If you can't then i dont blame them for using a cheaper brokerage. I know what my services are worth, and have the seller testimonials to prove it when i do a listing presentation.
We are in a sellers market right now and seems like every week some new new “reduced fee” agency opens up shop. Sellers are catching on & we are encountering more requests to cut our commission. Standard here is 6 split 3/3. If we do cut commission (like in a buy/sell situation), we never cut the 3% to the buyer. We only cut our side.
This way of thinking is still too commonplace. Get out of the price-fixing mindset and embrace competition.
If you are affiliated with a brokerage or a broker stupid enough to state that there is a standard commission of any rate, leave immediately and go to work for an ethical, modern brokerage that will train you properly.
Unbelievable. Just unbelievable.
Yup. I would also say that talking about commission among agents in such a specific manner is HIGHLY illegal and would be considered collusion. Find a new broker who will educate you about these things so that you don't get yourself in trouble.
Maybe instead of “standard” I should’ve said customary. Yes, I know that all commissions are negotiable. Still, in my market, over 90% of closed deals have 3% going to selling brokerage & 3% going to listing brokerage.
This way of thinking is still too commonplace. Get out of the price-fixing mindset and embrace competition.
That has ALWAYS irritated me as a customer. I DID select an agent who charged the "customary" commission on my last sale because I knew she was good- had worked with her before and knew she was in the business for the long run. She paid for staging and a professional photographer and made a lot of recommendations (which we did at our own expense) to make the house more marketable. I knew there were agents who charged less but did bare-bones marketing and was glad those options were available, especially to people who needed every dollar they could get out of the sale. It just wasn't what I wanted.
Back in NJ in 1997, the realtor I used after my divorce cut a percentage point off her commission because she handled both transactions- selling the marital home and my purchase of another one. She asked me not to publicize that. I really didn't like the idea of the secrecy but I complied.
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