Being a 5th year Real Estate Broker and a new business owner has forced me to take a good long, hard look at my industry. Breaking into Real Estate at the end of the market crash, I think its fair to say that things have changed. People don't trust their Broker's as much. Broker's come into the business thinking they'll make big money with little work and people are under the impression that selling Real Estate themselves is easy. Both of the last statements are not true.
Unfortunately, just like any profession, there are good Brokers and bad Brokers, just like good and bad doctors. A good Broker will work hard for you and often pay for advertising and marketing your property out of pocket without the promise of return. The downside to selling yourself is that (dare I say it) you really don't know what you are doing. Regardless, more and more people are selling on their own and are getting the job done, right or wrong. This has forced me to revisit how I run my business and what I can do to ensure success for EVERYONE buying and selling a home. You have seen my paperwork services now lets talk about that other word. Commission.
I've been thinking about how that works. The standard commission is 6% where by, if a different agent brings a buyer other than the listing agent, both agents split that commission. Traditionally, the seller pays that commission. So, on a $100,000 property, the seller pays a total of $6,000 in commission fees. The person selling a $300,000 home pays a $18,000 commission for what should be the same amount of work. Hmmmm......now I'm starting to get it. Personally, I promote my $100,000 properties just as hard as I promote my high end properties. So is this really fair? And you can do the math on $400,000 and up properties.
I can tell you right now that this post will NOT be popular with my colleagues. But I do think times have changed and its time that Broker's rethink our businesses. So what is the answer? I'm not sure. But what I can say is that I am willing to have those conversations with my Seller's.
My profession has an intense education criteria and licensing fees which are ongoing to make sure we are current on laws and new required paperwork, which is something that I don't think every seller realizes. Also, when you split a commission with a Broker, you want it to be appealing but it shouldn't be a deciding factor on whether or not a Broker shows your property. It should always come down to the customer and meeting their needs. I mean really, shouldn't it?
I am willing to think outside the box and have those conversations with potential sellers and finding ways to bridge the gaps between buyers and sellers. If you are thinking about selling, lets talk. Also, I would like to hear from the consumer what your thoughts are. Sound off! I'm listening. But please, lets keep it positive. I am not the Broker who screwed over your uncle's wife's cousin. How can I help YOU from here in being a successful buyer or seller.
Monday, April 25, 2016
So Let's Talk Commissions
Being a 5th year Real Estate Broker and a new business owner has forced me to take a good long, hard look at my industry. Breaking into Real Estate at the end of the market crash, I think its fair to say that things have changed. People don't trust their Broker's as much. Broker's come into the business thinking they'll make big money with little work and people are under the impression that selling Real Estate themselves is easy. Both of the last statements are not true.
Unfortunately, just like any profession, there are good Brokers and bad Brokers, just like good and bad doctors. A good Broker will work hard for you and often pay for advertising and marketing your property out of pocket without the promise of return. The downside to selling yourself is that (dare I say it) you really don't know what you are doing. Regardless, more and more people are selling on their own and are getting the job done, right or wrong. This has forced me to revisit how I run my business and what I can do to ensure success for EVERYONE buying and selling a home. You have seen my paperwork services now lets talk about that other word. Commission.
I've been thinking about how that works. The standard commission is 6% where by, if a different agent brings a buyer other than the listing agent, both agents split that commission. Traditionally, the seller pays that commission. So, on a $100,000 property, the seller pays a total of $6,000 in commission fees. The person selling a $300,000 home pays a $18,000 commission for what should be the same amount of work. Hmmmm......now I'm starting to get it. Personally, I promote my $100,000 properties just as hard as I promote my high end properties. So is this really fair? And you can do the math on $400,000 and up properties.
I can tell you right now that this post will NOT be popular with my colleagues. But I do think times have changed and its time that Broker's rethink our businesses. So what is the answer? I'm not sure. But what I can say is that I am willing to have those conversations with my Seller's.
My profession has an intense education criteria and licensing fees which are ongoing to make sure we are current on laws and new required paperwork, which is something that I don't think every seller realizes. Also, when you split a commission with a Broker, you want it to be appealing but it shouldn't be a deciding factor on whether or not a Broker shows your property. It should always come down to the customer and meeting their needs. I mean really, shouldn't it?
I am willing to think outside the box and have those conversations with potential sellers and finding ways to bridge the gaps between buyers and sellers. If you are thinking about selling, lets talk. Also, I would like to hear from the consumer what your thoughts are. Sound off! I'm listening. But please, lets keep it positive. I am not the Broker who screwed over your uncle's wife's cousin. How can I help YOU from here in being a successful buyer or seller.
Saturday, April 9, 2016
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