By Renee Porsia, Real Estate Girl
For as long as I’ve been a Realtor which is 10 years now, I’ve always heard sellers and buyers say that Realtors get paid too much money. Easy to say coming from someone who isn’t paid by commission only and who gets a paycheck every Friday. It’s always easy to judge someone when you do not walk in their shoes. Isn’t it?
Let’s talk about this for a second. When someone contacts me to come to their home to possibly list it and I am there for an hour or more, I am not being paid and if they do not hire me, I worked for free. If a buyer contacts me about buying a home and I meet with them and spend an hour with them and they do not hire me, I worked for free. If a buyer decides to work with me and I show them 1 home or 50 homes and they decide they do not want to buy any of them after I just spent 3 months with them, I worked for free. If I list a seller’s home and the home never sells after I spent money to advertise it, which includes signs, lockboxes, flyers and internet marketing, I worked for free and I am actually out money because I have to pay out of my own pocket to market the home.
Now, lets look at it from a different perspective, if I meet with a buyer and they decide to work with me and I show them one home and they buy it, I get paid a commission aka fee for service when it settles which still will take no less than 30 days and if I list a home and it sells in one day, I will be paid my fee for service again in no less than 30 days and many look at that and say well, she didn’t do anything and she is making this much money but what they fail to understand or know is that there is still a lot of work that needs to be done before settlement day and guess who is doing that work, me. One of the most valuable services I will be providing to that buyer or seller is to ensure that settlement will indeed take place and that the transaction doesn’t fall apart. So many things can happen during the time a buyer signs an Agreement of Sale or when a seller accepts an offer on their home. I will have to deal with the mortgage company, title company, inspection company, the other Realtor, do mounds of paperwork, spend hours on the phone going back and forth with those involved, arrange final walkthrough and attend, arrange inspections and attend and if all goes as planned, finally attend settlement so at the end of the day or in this case, transaction, I could have possibly spent well over 40 hours on just one transaction. Most people get paid weekly for a 40 hour work week. I will wait 30 days or more to be paid and that amount will be different each time and will depend on how much the home finally sells for.
I’m sorry but that is a damn good arrangement for buyers and sellers. They pay nothing while I do all the work and they will not pay anything until they go to settlement and then, that’s right, it’s time for me to be paid for all the work I’ve already done. Who else provides that type of fee arrangement?
But hey, I can change if you want change. Rather than pay a commission or fee for service, let’s change the way the entire real estate industry does business. Pay an hourly fee or an up front retainer. If you are a seller and would like for me to come to your home for a listing appointment, I’ll charge you an hourly fee and this way, if you do not hire me, I still earned my fee for services rendered and I am paid for my time to meet with you. If you are a buyer and you want to meet with me before you decide to hire me, you pay me an hourly fee and then you can go home and decide if you liked what I had to offer you. If I show you 1 home or 50 homes, you can pay me an hourly fee and if you decide to never call me again or to go buy a home from your best friend who just got their real estate license after I spent 25 hours with you over the course of 2 months, well then no harm, no foul because I’ve been paid. Hey, if you don’t like hourly fees, pay me a retainer and after that retainer is used up, you can pay another until you finally make settlement on your new home or sell your existing home and if you decide not to buy or sell, well then that’s the “price” you will have paid for my services.
What are your thoughts? I’d love to hear them.
- Understanding Real Estate Commissions (realtown.com)
- Should You Buy a House without a Lawyer? (brighthub.com)
- How does an “exclusive buyer’s agent” get paid? (ask.metafilter.com)
- Homekeys Launches “Pay As You Go” Flat Fee MLS listing Service in 18 Florida Counties (prweb.com)
- Charlottesville VA Realtors Launch New Central Virginia Real Estate Website (prweb.com)