Less than 3% commission to buyer's agent (incentive, negotiating, sales, fee)
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I have seen listings offered at a less than 6% these days, wherein the seller's agent gives a rebate and also, lists the house at less than 3% for the buyer's agent. Given this market, is it advisable or risky to go easy on the 3% commission for the buyer's agent?
It depends on what market you're talking about since you didn't say your area. In my area, good luck selling your house if you're not going to offer the buyer's agent the "expected" amount. In some areas of the country, that "expected" amount is 2.5%. Some places, if it's high price points, it's 2%. Many are 3%. There is no set commission to offer, but there are numbers that are expected in different markets, though it doesn't mean things aren't negotiable. Everything is negotiable.
Though it's not really ethical to steer based on commission %, you can't deny that an agent will (maybe even subconsciously) be more attacted to a 3% commission than 2.5%. I tell my clients that ask about a discounted fee that this is a very hard market...you want buyers agents to be excited to show your property. Do you really want to reduce that motivation? Most of them say no, but some will still say yes.
Though it's not really ethical to steer based on commission %, you can't deny that an agent will (maybe even subconsciously) be more attacted to a 3% commission than 2.5%. I tell my clients that ask about a discounted fee that this is a very hard market...you want buyers agents to be excited to show your property. Do you really want to reduce that motivation? Most of them say no, but some will still say yes.
Depends on how motivated the seller is and how cherry the property is. If I had highly desirable property that was well known I woudl offer a 0% commission all the way around as once the buyer themselves found my place on MLS or r.com they would force their buyers agent to show it. Also it helps to own the property out right so you can sit on it until an appropriate buys comes around.
Places with phenominal views or some other uniquie highly desirable feature. Top tier school districts, etc.
3% is most common in my market. I'll show buyer's homes when it is less. It would be wrong not to. I can't vouch for other agents so I always ask sellers to offer 3% when we list properties. I don't want my sellers to miss any potential buyers. That sometimes means I'll take less on my side.
In a sale earlier this year my sales agent suggested I offer a "spiff/bonus" so buyer agents would be more interested in showing my home.
Was she implying they can be bought?
She may only have been implying you could offer attractive terms without cutting price publicly.
Our MLS tracks price changes and raising prices can raise eyebrows.
People foam at the mouth when they see price increases, as if Satanical influences have been unleashed.
But, a listing agent can put money into play by increasing co-brokes, raise or lower co-brokes at will, and not affect pricing or the public record.
If two properties are nearly identical in features and pricing, a couple percent of co-broke may be money in play for the buy side.
Yes, some agents can be bought. Agents and non-agents are all products of the same gene pool, and thousands of years ago the effects of greed were documented within that gene pool.
Attorneys can be bought. Judges, too. And inspectors, town councilpeople, mediators, etc. We depend on the honest ones to keep the wheels of civilization turning, and hope the dishonest ones don't account for too much of the population.
True anyone can be bought but she flat said consider offering a $1,500.00 bounus to the buyers agent that brings a contract that closes. She said it is a common, but publically not talked about practice. Is it?
True anyone can be bought but she flat said consider offering a $1,500.00 bounus to the buyers agent that brings a contract that closes. She said it is a common, but publically not talked about practice. Is it?
In NC it has to be talked about. It is written into the standard contracts that any bonuses or incentives have to disclosed before showing a home. Here buyers are supposed to be fully aware that their agent is getting any bonus. That being the case I usually use it as a negotiating tool to get a better deal for my buyers.
True anyone can be bought but she flat said consider offering a $1,500.00 bounus to the buyers agent that brings a contract that closes. She said it is a common, but publically not talked about practice. Is it?
I had a builder's agent call me and tell me that even though the co-broke was 4%, she "...would have no problem asking for an increase..." if I brought the buyer back.
That builder is offering 6% to buyers agents in other communities.
It is not uncommon to offer a bonus or to goose the commission a little.
Some agents keep it.
Some agents seek it.
Some agents rebate it to buyers.
All part of the shell game of buyers thinking they can get something for free, since "buyers agency doesn't cost them a penny."
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