| Real estate brokers can provide rebates, cash back, and/or gifts to their clients.
As the Department of Justice website indicates "Some real estate brokers offer consumers cash refunds or non-cash incentives to encourage them to use that broker’s services. Rebates are typically cash payments from the real estate broker to his or her client AFTER closing. Incentives may include gift certificates, closing-cost payments, or free ancillary services such as home inspections or moving services."
http://www.usdoj.gov/atr/public/real_estate/rebates.htm
Buyer broker rebates are the principal method by which a buyer broker can discount and negotiate his/her fees. As such, broker rebates are morally good because they create healthy price competition and innovation amongst real estate brokers who compete for home buyers. Any restrictions on broker rebates would harm fair trade and increase costs to the home buyer consumer.
David Gorman/Real Estate Broker
http://www.CashbackRealty.com
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| Above Posted By:
CashbackRealty.com
| Wed, 19 Mar 2008 19:19:43 EST |
| I am a discount realtor and cannot for the life of me understand why there is such a controversy about pricing. If you think you will make more money doing it, charge 6%, charge 10% if you can do it.
On the other hand, I feel that I set up for myself a more stable business by having a larger volume of clients at a slightly lower commission level.
The problem is a lack of competition I think partially because people don't know how to find a suitable agent for themselves.
People ask their friends for recommendations, but most people aren't that comfortable negotiating especially if they really don't have a ton of options.
I think internet is the perfect place to resolve this issue. I have recently stumbled on a site called seekingagents.com that I think is doing a good job at working on the issue.
Put everyone in one place, have them present their qualifications, and let the the homeowners decide for themselves which way they want to go.
Competition is what it is. It's a healthy force for the economy as a whole, even if it might not be great for some individual's bottom line. I for one emrbace it. It has made me a much better agent to be forced to operate on 4% gross margins rather than 6%. |
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| Above Posted By:
Janet
| Fri, 14 Mar 2008 16:29:53 EST |
| i am a discount realtor in canada and when the market is booming we do ok but there is a huge boycott from other agents so when things slow a little, we starve. the broker doesnt care...from what i've seen the best thing to do is get a GOOD full commission realtor to sell for top dollar! |
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| Above Posted By:
anonymous
| Wed, 21 Nov 2007 00:26:51 EST |
| I'm a broker, I see the need to lower commissions for the seller in a declining market. Having the seller pay a fee up front and splitting that fee with the agent, pay 3% for the agent that sells the property and take .5% for the listing broker. Keeping in mind that advertising will be at an additional fee as well as open house agreements. With the web market today, good photo's and smart descriptions of the propety can get the job done. Lets get salemanship going in real estate once again. |
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| Above Posted By:
Vetteguy
| Wed, 17 Oct 2007 13:13:28 EST |
| I have a graduate degree and I am a broker.
I took on an expired limitied listing that was on the market for 5 months. The first thing I told seller was that I will not take listing unless she allows me to stage it. (free) I rented furniture, placed it on front page of homes magazine, sold in 2 weeks. Asking price 477,00 sold for 475,000. Appraised for 450000. I insisted we get another appraisor, appraised for 470,000.Sold for 470,000.
I never represent two sides in same transaction.
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| Above Posted By:
Natalie
| Fri, 25 May 2007 14:01:40 EST |
| The problem with this business is agents are paid only when the deal is consummated. Some properties sell very fast with little effort form an agent. Others take longer time and effort and some others never sell in spite of all the efforts in which case all the time effort and money spent has gone down the tube. I think a fair way to pay an agent by the hour, just like othr professionals like Attorneys and Doctors |
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| Above Posted By:
Anonymous
| Tue, 15 May 2007 19:32:23 EST |
| Accused me of taking away her livelihood, impugning her ethics, etc. Said her advertising costs were still the same (Exactly my point, her costs were the same, but her commission doubled due to our efforts.) Then sounded threatening me when she said "when this deal goes through, if it goes through, and we're a long way from that!" (we're not aware of any potential glitches.) Would not allow me to speak during her several-minute diatribe and then hung up on me. Comments professionals.? |
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| Above Posted By:
Anonymous
| Sat, 21 Apr 2007 13:26:50 EST |
| A few days after the agreement was signed (at our insistance, otherwise we were going to rent the house to someone else), I sent an email to the agent asking if she still planned to take 7% as the sole agent and since we brought the buyer to the property. She ignored my email. I called her later and left a message that she needed to answer the email. No answer. A couple of weeks later I asked her about it on the phone. Still no answer. Finally pushed for an answer, she exploded. |
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| Above Posted By:
Anonymous
| Sat, 21 Apr 2007 13:20:49 EST |
| One of the potential renters (we had lots of interest based on our craigslist ad and "For Rent" sign) decided she wanted to purchase the house after my husband and I spent time showing it to her and discussing a possible lease/purchase option. She had already decided to purchase the house when we put her in touch with our agent. She had her own mortgage person and no credit problems. Our agent refused to give us any direction on how to structure the lease purchase terms ("It's up to you.) |
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| Above Posted By:
Anonymous
| Sat, 21 Apr 2007 13:17:01 EST |
| We are with a traditional broker, signed a six-month contract (7%) and had very little traffic. Re-signed for three months with the stipulation that we would probably put our home on the rental market during this period if necessary. After re-signing emailed numerous updated int/ext photos and a detailed rental posting to agent requesting that she update our listing with the unique charateristics of our home and new photos. That was over six weeks ago, still not done. |
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| Above Posted By:
Anonymous
| Sat, 21 Apr 2007 13:12:13 EST |
| There is room always for a good business model whether its unbundled fee for service or discount. What matters is results not how much money is spent or saved or rebated etc. An agent's fiduciary is to the client and the agents responsibility it to close escrow and for that the agent is paid not by the hour or for merit but is paid for results. Do not confuse time or money spent for results. One more thing, the MLS is for B2B use only PERIOD. If people want access to the MLS become a REALTOR. |
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| Above Posted By:
Ron
| Wed, 11 Apr 2007 18:29:07 EST |
| I left a nationally known brand, Coldwell Banker, to have more control over my choices as well as being able to give my clients a well deserved break. Afterall it's the individual Realtor who is really selling the home not the brand name. Consumers are waking up and demanding more and more information thanks to the internet. It's just a matter of time before the old dinosaur companies are extinct. I now work for Premier Real Estate in Fountain Valley Ca. I pay a modest per transaction fee. |
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| Above Posted By:
Peggy Aldinger
| Sun, 18 Feb 2007 10:21:07 EST |
| I am a broker offering discount services through our website. I think when you analyze the amount of time that is put into a transaction, you have to look at both sides. On the listing side, often the time spent is minimal since it is mostly marketing, however agents representing sellers have a fair amount of work to do with inspections and such if there are truly "doing their job". |
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| Above Posted By:
Dale
| Fri, 9 Feb 2007 17:48:44 EST |
| 90% of buyers would not use an agent if they had access to the MLS or some other listing and they were able to collect the 3% commission. Let's level the playing ground and see how many people really need agents. We did this with with travel agents. Today most people prefer to pick and book their flights themselves. For others, they use an agent and pay their fees. Why is the MLS so private. If I am selling something, I would want to open the market to everyone. |
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| Above Posted By:
Lets be honest
| Tue, 26 Dec 2006 09:33:48 EST |
| My 2 cents. I am a Realtor, I do not make millions of dollars and have fancy cars or a million dollar home. I drive a 1990 Volvo and have a very modest house. I do work Very hard for the people who choose to let me represent them, as buyers or sellers. The clown who says he can do an entire transaction in 5 hours is full of it, I have been to inspections that exceed 3 hours alone, and when it comes to making a closing go smoothly....I have been at some closings for more than 6 hours! Total 40+! |
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| Above Posted By:
Honest realtor
| Sun, 29 Oct 2006 11:33:25 EST |
| I read an article on Realtor.com that said the average time from list to sold that a Realtor spends on a transaction is 10 to 15 hours. My personal average is about 5 hours thanks to technology. I beleive the need for Realtors is going the way of Travel Agents. Adapt or face the same fate. I've been selling for over 20 yrs and avg. about 80+ sales per year. I'm looking to sell 10 times that, make more money and work less. To Realtors I say "Get with it or get out of the way." A win win for all. |
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| Above Posted By:
Realtor in Nevada
| Mon, 23 Oct 2006 13:50:21 EST |
| WOW... We provide full service to our clients – not just a sign and a listing! What job do you know ANY WHERE that you do ALL the work up front, pay ALL advertising money out of YOUR pocket, Spend time on the phone, traveling, doing paperwork AND are expected to know about the law, financing, settlements, ect and THEN wait 30, 60 or even more days to get paid? If all these people are so confident and so opposed to the commissions… sell your home yourself and see if your feelings change! |
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| Above Posted By:
Realtor in MD
| Fri, 6 Oct 2006 16:42:28 EST |
| (Cont) Agent Commisions are like added taxes. However, instead going to schools and highways, the money goes to expensives cars and homes for the agents. Realtors don't want non-Realtor agents reposting thier listings. How does that help their clients? I thought exposure was good.
Why shouldn't discount brokers be able to use the MLS to sell a home? Wouldn't buying agents want to see all the homes available. They say they have integrity and honesty. Its more about commisions and kickbacks. |
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| Above Posted By:
Lets be honest
| Fri, 8 Sep 2006 11:44:44 EST |
| All these agents talk about the long hours. Hello many people work long hours. I spent about 10 hours with my agent and she made $12K even after she paid me a $6K rebate. Agents always use the phrase "biggest investment of your life" Well they can not tell you the value or how much to see it for, they show you comps. You need to pay an appraisor $350 to know its appraised value. The contracts are standard. Most of the work is putting in the address, offer amount and of course their commision. |
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| Above Posted By:
Lets be honest
| Fri, 8 Sep 2006 11:37:27 EST |
(Laura, cont.) My personal marketing efforts include everything from my pre-license to post-license education, seminars, business meetings, membership fees, mailings, photographs, office supplies, gas, food, etc. I had one buyer client whose situation changed and after a week of efforts and showing 14 homes, nada. Couldn't be helped, I absorbed the costs. Another buyer I have been working with backs out due to family 'issues'. I am an independent contractor, the Buck Stops/Starts Here.
I was a FSBO once, I got into the business not fully comprehending what agents did. I sold my house to a woman who turned around 6 months later and sold it for a profit of $22,000.00. What happenned to the penny I saved? I made myself real estate savvy. ("Fool me once." ) Now, all this is to say. I can offer a wonderful service as a Buyer's or Seller's Agent and I am clearly worth every dime, unquestionably! And truthfully, MOST AGENTS ARE! |
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| Above Posted By:
Laura
| Sun, 27 Aug 2006 12:43:19 EST |
| It is an interesting conversation to say the least..I purchased my first home at 23 yrs. old and have bought and sold 3 more scince then and it seems to me that a majority of agents I have come into contact with are not at all worth the commissions they are paid..period..this is true for friends as well..my family had been in this business my entire life so I know what I speak of...get with the times ..quite your whinning..look at your industry trends and change your business model..or get out. |
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| Above Posted By:
anonymous
| Thu, 20 Jul 2006 11:00:39 EST |
| More education requirements and enforcement - The bottom line is that buyers and sellers need to do their homework. I've been in this business for over 4 years and have my brokers license. The days are long and I've missed sunday dinners, etc. Yes this can be a lucrative career but like any other job it has its pros and cons. Buyers are here today and gone tomorrow. Sellers really don't understand what it takes to get a deal done. |
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| Above Posted By:
Abe
| Wed, 21 Jun 2006 03:12:08 EST |
| Cont again: I'm almost done. On top of all this we have Mandatory Continued Education to keep us current of changes in our industry. We also have numerous fees that we have to pay for in order to stay licensed, there are national fees, state fees, local fees, mls fees. We still have to provide for our families. What you are also doing is feeding the economy. Why do I do it? Because I like helping people. Believe me. It is better to seek the services of a Real Estate Professional. Thanks |
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| Above Posted By:
J.A.M.
| Wed, 17 May 2006 18:00:32 EST |
| Cont: I have worked with For Sale by Owners, after they have given up trying to sell on their own. They have told me that they would not think about selling on their own again. They would rather pay the commission. I had a friend who's uncle absolutely refused to seek my services because of commission. He sold his home in 2 days. He was so proud of himself. Only problem was he sold it at $40,000 less than market value. He was so upset with himself after I told him what he had done. |
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| Above Posted By:
J.A.M.
| Wed, 17 May 2006 17:55:40 EST |
| I am a real estate agent. There is so much to be said about our commissions. Truth is that we work really hard for our commissions. We have to deal with buyers and sellers alike on a daily basis. We work days, evenings, weekends, during birthday parties, holidays. We market and show properties sometimes until 10pm. We get out of town people who show up on a weekend and want to view numerous houses. We show these people house all weekend long. They leave and most of the time never call back. |
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| Above Posted By:
J.A.M.
| Wed, 17 May 2006 17:52:17 EST |
| Can you tell me want to look out for when dealing with a real estate agent . I really do not want to spend alot of money when buying a house. I would of prefer getting a mortgage from the bank but my credit score was in the fair range. Thanks, Dennis. |
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| Above Posted By:
Dennis
| Thu, 20 Apr 2006 14:41:23 EST |
| Please be aware of the HUGE difference between DISCOUNT BROKERS and SET FEE brokers. I worked for a traditional broker for 5 years then moved to Help-U-Sell. We charge the seller less, but we are FULL SERVICE Realtors. Discount Brokers will put a listing in the MLS and a sign in your yard and do NOTHING else. We had that experience here with clients thinking they could get a cheaper price & get the same service. They came back to us after a month of NO showings! More previous traditional clients are switching - NO 6%! |
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| Above Posted By:
Nancy
| Mon, 10 Apr 2006 10:48:10 EST |
| I have no problem with these so called cut rate brokers taking flat commissions. What I do have a big problem with is the National Board of Realtors and the Multiple Listing services allowing these agencies to post the listing on REALTOR sites. They are not REALTORS. Usually the homeowners that are doing the selling appts, & neg. All they are doing is listing their homes in a place that has the most exposure & its cheaper than listing it in the newspaper. They should be in a separate medium. |
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| Above Posted By:
geotone
| Tue, 28 Mar 2006 21:35:46 EST |
| Prices are fixed in the real estate industry. We have a Full Service 2% listing program that's breaking the mold to save consumers money. We are also looking for more agencies to join our team. |
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| Above Posted By:
John
| Tue, 7 Mar 2006 14:13:08 EST |
| Six years ago our house cost $180,000. We found it ourselves, contacted the agency and it was purchased in a week. Now the value of the home is $425,000. The effort to sell this house will be no greater than it was 6 years ago. It isn't worth paying $25,000 an agenct to run it in the MLS. Time to scale back the commissions. |
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| Above Posted By:
Homeowner
| Mon, 27 Feb 2006 06:45:37 EST |
| Ask any Realtor, 90% of their work is finding clients because there are so many realtors these days. Don't kid yourself into thinking you deserve 6%. Anyone can take a class and pass a test and call themselves a Realtor. In the old days (1995) Realtors had to really work to get exposure to their properties they are selling. Now they put it on the MLS. Anyone can find a home in a database. Nobody should pay 6% anymore. It is price fixing. What happened to capitalism? Brokers are being greedy. |
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| Above Posted By:
Lets be honest
| Fri, 17 Feb 2006 19:51:41 EST |
| Discount brokers fill a niche in the real estate marketplace otherwise they couldn't get enough business to exist. The Internet does precisely what it is intended to do, disseminate information in a timely manner and create efficiency through technological advances. If real estate agents complain of spending too much time marketing a home or losing buyers to fsbo's maybe their time would be better spent attending seminars on sales and closing techniques thus improving their hourly earnings. |
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| Above Posted By:
Ray
| Sun, 12 Feb 2006 00:22:15 EST |
| Discount Brokers, are simply just that. Many turn a blind eye to the financial commitment and time put forth in the "prospective" presentation, marketing, associated travel expenditures, sale and eventual closing of a piece of property. Maybe some of these "critics" should quit their regular income careers, and attempt to earn a family wage solely dependent upon on a sales commission. |
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| Above Posted By:
JDM
| Mon, 16 Jan 2006 19:18:25 EST |
| The public does not seem to grasp how much work a realtor puts into a single transaction. There are alway eveings and weekends an Agent has to spend away from their families. In other lines of enployment you are rewarded with overtime pay, but as a Realtor you are expected to adjust your schedule to make it easier for your Client. You often spend countless hours, and money showing property only to find your client changes thier mind and then does'nt buy a home. |
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| Above Posted By:
Steve
| Mon, 2 Jan 2006 20:31:37 EST |
| After reading the general messages posted I have come to the conclusion that the way business is being conducts needs to change. With what is going on due to the evolution of the internet we have got to seriously look into redoing our structure, business model. The flat-fee offices and the percentage based offices will both have to "evolve" and the savvy business owners will be the onces to capitalize on this change. Those who fear change are the ones who will be with out. |
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| Above Posted By:
Jon-Ohio
| Sat, 24 Dec 2005 12:55:46 EST |
| The problem is with the homeowners. If they would do their homework, they would see that there are many services out there that get their home listed on the MLS or Trend, and online. These companies will do it for as little as $300, including pictures. Or, companies like Help-U-Sell and others that will do it for a much lower flat-fee. It is a myth that the nice pictures in the homes magazines actually sell the homes. All they do is to get the sales offices phones to ring. |
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| Above Posted By:
Joe Kamenr
| Wed, 7 Dec 2005 10:58:05 EST |
What I find particularly outrageous is when a realtor purposefully low ball a new listing to get a double commission (with a happy lined-up client who gets the "good deal").
I have seen this many times and I find this to be very dishonest, if not criminal.
Realtors have way too much power and where there's too much money to be made it breeds dishonesty and trickery.
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| Above Posted By:
Lucy
| Wed, 9 Nov 2005 16:02:56 EST |
| Maybe realtors should charge by the hour. This way every time they work for a buyer and or seller and put in hundreds of hours, they would be paid for there many hours. The late nights and weekends that often go unpaid when the buyer jumps agents or buys a fsbo, or a listing is canceled after two months and many dollars are spent on advertizing and many hours in marketing, to my knowledge they are never repaid for this. |
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| Above Posted By:
davd
| Wed, 2 Nov 2005 22:17:36 EST |
| How many hours would it take to negotiate between the FSBO and a qualified buyer and monitor the sale to a successful closing? |
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| Above Posted By:
Joe Khalaf
| Wed, 2 Nov 2005 00:40:05 EST |
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