Commission rates are once again a focus in the media with the market downturn. This article talks about offering 8-10% commissions to get a home sold. THIS IS ABSURD! There is something really wrong when a higher rate of commission is the determination if a real estate agent “pushes” their client to buy a particular home, especially when there is no additional services provided for the extra commission.
All you have to do is drive around to see the lack of listing services being provided with current commission rates. Just look at all the empty flyer boxes! My kids used to have a game where they counted xmas lights on houses when we drove from one place to another at night. A new variation of the game is to count empty flyer boxes. If you are looking to Sell your home, make a note of the agents who have empty flyer boxes so you know who NOT to call.
What is troubling is that if a real estate agent is “motivated” to sell a home with a higher commission rate, then how are they going to provide good representation for their Buyer? For some, closing that deal will be the priority even if there are issues that come up that may make it not in their clients best interest to proceed with that home. Or, they may not negotiate the best price for the Buyer. If I was a Buyer, I’d want to know the commission being offered the Buyers agent before I went and looked at a home.
What is a joke to me is that the example in the article has the Listing Agent getting a higher commission split of the 8% commission (55/45). If one is to believe that a higher commission is needed to motivate Buyer Agents, then the split should be something like 25% to the Listing Agent and 75% to the Buyer Agent. What extra service is a Listing Agent going to provide??
I created SloCountyHomes.com to educate Buyers and Sellers so they can make a good decision on one of the highest financial transaction most people will make in their lifetime. It used to be that real estate agents were the keeper of information and they decided what to provide to their clients. To me, this article makes it seem like Buyers are still not getting the info and are allowing agents to make decisions for them. While the services that real estate agents provide are very important, being the gatekeepers of information is NOT one of them, IMO.
If you know of anyone Buying or Selling a home, encourage them to visit http://www.slocountyhomes.com/ and http://www.slowatch.com/ so they can obtain information they may not be getting elsewhere. If you are Selling your home, the way you stand out from all the other homes you’re competiting with is the way your home is marketed (photos, Internet exposure, brochure, etc.) and price. If all Buyers used a site like SloCountyHomes.com to see the homes on the market, then the way people will be motivated to see your home is how well it your home is presented. Isn’t that the service you are paying a Listing Agent to provide anyways?? Then, there would be no reason to pay Buyer Agents additional commission to get them to push their client towards a particular home.