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Real Estate News And Advice
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February 12, 2012
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Response To: |
Is the Commission System Unfair?
(Mollie Wasserman - 06/08/2000)
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Commissions / Fees ? Lets do whatever works!
Posted By: d_garza@remax.net - 06/11/2000 12:29 AM
I feel that the industry is moving to team a type model that truly acts like a business, the agents that are the heavy hitters are built around a team busniess concept. The old model of hiring any salesperson with a pulse for a 50 to a 100 plus agent office with a huge overhead is just plain stupid. I also think that it is the larger offices that are afraid of the fee or lower commission charge business because of their overheads. This business is about the 20% of the active agents that do the 85% of the business. We have seen hundreds of REALTORS leave this business over the years and I feel we will see hundreds more go in the future who are not high producers and business people. I also believe that in this time of agency the commission split is going to disappear. Instead of a property owner hiring us to sell his property, they will be hiring us to represent them in the sell of their property. So instead of charging the owner 6-7 or 8% commission, say we were to charge them 3-4% or what ever the market will bear with no commission split, "fees / commissions are supposed to be negotiable right". The owner pays the listing broker from the equity / profit he has from the sale of his property. The buyer wanting to have an agent represent his best interest will pay that broker what ever they have agreed to, should that be 3-4% or what ever the market will bear. The buyer will pay the buyer's broker from cash reserves or borrowed funds, since the mortgage company is financing the the commission / fee over the term of the note for the buyer, this is the most likely the way the buyer's agent will get paid, " and usually how the seller's agent will get paid too". With a system like this all parties involved would truly receive equal representation in the transaction and get their monies worth. As far as advertising goes I also feel that 85% of the homes sold are done so through the local MLS systems and that we should be marketing ourselves instead of property. If we were really smart we would open our local MLS data systems formatted for the local community to view and search over the internet and save ourselves thousands of advertising dollars, since it is reported that 70 to 90% of homebuyers start their search via the internet. I feel that the local association and not the national organization should be the party marketing the local REALTORS and properties. Letting the local community know what a REALTOR can do for them and that using a REALTOR is the most effective way to sell or buy real property. We need to let the local community know what we are doing as an association to make our community a better place to live, work, play and enhance individual property rights. A good website would not only promote real property for sale but also the local community, REALTORS, and any member business that are associated with the local association and their websites could be link to the associations website.
As far as homes that are listed that do not sale. Well every home should sell if it is priced right, if it needs work get the owners to do it, if not price the property to represent its condition. The seller is looking for a preapproved buyer with financing in place. Shouldn't the buyer be able to find a preapproved home on the market that has had its inpections and appraisal and repairs done also?
I feel it is time that we as an association really look at how we do business and begin to operate like business.
Thank you for your time and attention.
Yours,
d_garza@remax.net
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