Can someone help me understand why the listing agent makes less money in selling the listing than the selling agent? You pay the utilities and sometimes bills that incur, they reimburse you, but initially you are using your money. You check the property every week, advertise it, and you as the listing agent get the short end of the stick. Maybe I am not seeing something here enlighten me someone.Oh, Oh wait that is not the best part! Then there is a bonus for the selling agent.
I guess it was fine with Volume, but the main co I work for "O" isn't giving us volume anymore. Too bad. I will say one thing being an REO agent, you do attract more buyers and that means 3-3.5% and maybe a bonus.
To Me, Bottom Line, it's a business decision. I know that 1.5 to 2.5% of something is better than 100% of nothing! While I understand Jesse's reasoning, I have to disagree. I'm in business, I'm in competition with others for this business, if someone calls me up and says, "we'll give you this business, but for a fee less than you are used too, is that OK?" Now it's time for me to make some business decisions. Now don't think that I just jump on everyone. There are other criteria that I use to determine if "I want to work with this company". But with all things being just about equal I go to the next step in the process.
My thinking is, well my competition isn't getting it, I'm getting it. I have a fairly good chance of selling it, and here's the important one.......if I do a good job, which I pride myself on, then they will keep giving me more!!!!! Well then I guess all I can do is say "YES"......but only on those days of the week that end in a "Y". If there are issues with that particular company, or I don't believe that it is a saleable asset, or I find out that this company creates way to much work for me, then the answer is no. One thing I do is check them out on some REO forums if I don't know anything about them. Do some research people. If they are new, I might give them a chance. If I get burned, then it's a learned lesson. If it's successful, then it's still a learned lesson, allbeit a better one.
As for the selling agents making more than me, they are just getting a few sales here and there off of us who are getting the listings. My very first Broker in this industry some 20+ years ago was this 93 year old guy who told me, "son, he who controls the listings, controls the marketplace". I still hold true to that idea. My goal is to continue to get business so that there is no down time. No time for the agents in my office to complain that there is nothing to do, or that "this market sucks". I currently have some clients that have given me at least an REO a month for the last 18-24 months! That, my friends, helps pay the bills. Will I take a 3% rate, heck yea, but they are few and far between right now. So why not fill them up with the ones that are offering less of a fee until the 3% listings return in our marketplace. The 3% commissions will come back my friends, but in the meantime, find something else that will bring you in some revenue to take care of those expenditures. Regards, KIRB
Just this morning I had a rep from a national bank ask me to reduce my commissions on a BOV because the other competing agents lowered theirs. This in not something I normally do and I asked this rep if they are planning to price the homes way below market value. She couldn't answer me on that one.
I then asked her if her paycheck were totally based on commission, would she be showing houses in the 3% to 4% (and we has subdivisions going 5% to 8% in that area) range or 2.5%? Again, she couldn't answer that question. You have to keep in mind that these bank folks are salary and have no idea what it is like to work on commission.
I will only consider reducing my commission if the properties are priced well below market and we get a quick sale and they agree with a reduction of services we will provide.
This is a prime example why banks should not be in real estate!
I wrote a response to a similar question a couple weeks ago. I was amazed at how many listing agents are out there taking less than 3% for thier side of the transaction.
I shared with the forum discussion that I don't take less than 3% ever and I had agents coming out of the wood work wanting to know how. Well, it was as simple as I don't accept assignements with less pay. Granted, i am no power lister....I don't have 50 listings but, I don't starve either.
The more agents who are willing to take less money, the more listings you are going to get where the bank is going to under cut us so, we have got to stop doing it or it will just continue.
I know in my market it pays to pay the SAs more than 3% because there are lots of listings....especially in certain cities where there was excess building during the up trend. There just isn't enough time to show all homes, which may all meet a buyer's criteria. When a listing pays more.....where do you think it goes, top or buttom of the list? I've seen many listings that pay 4% - 4.5% while very few pay 2.5. I dare say that the 2.5 will even make it to the To Show list when competing with a 4.5. On this listing you're talking about, if you are also the SA do you get to keep the full commission as if another agent sold it?
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My thinking is, well my competition isn't getting it, I'm getting it. I have a fairly good chance of selling it, and here's the important one.......if I do a good job, which I pride myself on, then they will keep giving me more!!!!! Well then I guess all I can do is say "YES"......but only on those days of the week that end in a "Y". If there are issues with that particular company, or I don't believe that it is a saleable asset, or I find out that this company creates way to much work for me, then the answer is no. One thing I do is check them out on some REO forums if I don't know anything about them. Do some research people. If they are new, I might give them a chance. If I get burned, then it's a learned lesson. If it's successful, then it's still a learned lesson, allbeit a better one.
As for the selling agents making more than me, they are just getting a few sales here and there off of us who are getting the listings. My very first Broker in this industry some 20+ years ago was this 93 year old guy who told me, "son, he who controls the listings, controls the marketplace". I still hold true to that idea. My goal is to continue to get business so that there is no down time. No time for the agents in my office to complain that there is nothing to do, or that "this market sucks". I currently have some clients that have given me at least an REO a month for the last 18-24 months! That, my friends, helps pay the bills. Will I take a 3% rate, heck yea, but they are few and far between right now. So why not fill them up with the ones that are offering less of a fee until the 3% listings return in our marketplace. The 3% commissions will come back my friends, but in the meantime, find something else that will bring you in some revenue to take care of those expenditures. Regards, KIRB
I then asked her if her paycheck were totally based on commission, would she be showing houses in the 3% to 4% (and we has subdivisions going 5% to 8% in that area) range or 2.5%? Again, she couldn't answer that question. You have to keep in mind that these bank folks are salary and have no idea what it is like to work on commission.
I will only consider reducing my commission if the properties are priced well below market and we get a quick sale and they agree with a reduction of services we will provide.
This is a prime example why banks should not be in real estate!
I wrote a response to a similar question a couple weeks ago. I was amazed at how many listing agents are out there taking less than 3% for thier side of the transaction.
I shared with the forum discussion that I don't take less than 3% ever and I had agents coming out of the wood work wanting to know how. Well, it was as simple as I don't accept assignements with less pay. Granted, i am no power lister....I don't have 50 listings but, I don't starve either.
The more agents who are willing to take less money, the more listings you are going to get where the bank is going to under cut us so, we have got to stop doing it or it will just continue.