Am I incented to try to get you to pay more for your home?


Am I incented to try to get you to pay more for your home?
By Scott Rogers • November 6, 2011
One of my buyer clients recently asked an excellent question -- whether I am really trying to get the purchase price as low as possible when I am representing a buyer in a transaction. It's a fair question -- my compensation out of said transaction, after all, is based on the purchase price. My client's concern was whether I would really be working hard alongside them in trying to get the price down as low as possible. I reassured that this was the case, for two reasons: I represent my clients fervently, regardless of how much compensation might be in it for me. My clients have hired me to represent them, and do it well, and so I shall. The amount of my gain for getting a buyer to buy at a higher price point isn't worth it AT ALL! Imagine that my clients are buying a house in the low $200K's. Perhaps the buyer only wants to go to $220K --- but I am hoping that my buyer client will go to $230K so that I will make more money on the transaction. WAIT A MINUTE -- let's see if that makes ANY sense at all, by examining my extra compensation in manipulating my buyer client into paying $10,000 more for the house...... $10,000 increase in sales price leads to.... $500 increase in gross commissions (based on 5%).... $250 increase in commission on the buyer side of the transaction.... $125 increase in commission after broker/agent split. As you can see here, by trying to coerce my clients into paying $10,000 more for the house they are buying, I only stand to gain $125 (approximately). As is probably clear, I'd much rather have $125 less in my pocket and have clients who are happy about the deal we were able to find for them! Receive Updates by Email Recent Articles: Is There A Price You WOULD Pay For This House? There Are Plenty Of Types Of Houses That Exist That Just Are Not Available To Purchase Home Sales By Price Range In The City Of Harrisonburg Are You Compromising On Aspects Of Your Next Home That You Can Or Cannot Change Later? How Much Slower Are The Winter Months In Our Local Housing Market? Rockingham County and New Home Sales Drive Surge in Area Housing Market Find The Balance Between Optimistic And Realistic Home Pricing Room Size Is Difficult To Understand Solely From Real Estate Photos How Much Would You Value Not Having To Prepare Your Home For Showings? One Out Of Four Homes Is Taking Longer Than A Month To Sell
Have any questions? Contact Scott Rogers at 540-578-0102 or scott@funkhousergroup.com
Based on information from the Harrisonburg-Rockingham Association of REALTORS® or its MLS, for the period Jan 1, 2000 through Nov 23, 2024 (unless otherwise noted).
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