The first interview I conducted (Tuesday, 7/18) didn’t even get that far because the agent spent 20 minutes trying to convince me that dual agency didn’t really make any difference. The prior 40 minutes were spent trying to steer us toward one of his many listings. Unbelievable.

Furthermore, he was shocked when I asked him for references — I guess he felt he was such an institution that his reputation preceded him. I just can’t work with that.

I found it! “REALTORS® urge exclusive representation of clients”

It’s in the Preamble. Just happened upon it when I was looking up something else. It doesn’t specifically say to refrain from and keep Dual Agency transactions at a minimum. It says the reverse, that REALTORS “urge” each party to seek out “EXCLUSIVE (separate) representation”.

Until the industry at large is willing to accept the concept that the Buyer pays for the Buyer Agent, all is lost, and I will continue to be a voice crying in the wilderness, changing the world one sale at a time.

Tell me this, Allen, what does the Seller get for his money, if you perceive the seller is paying the Buyer Agent? What does that Buyer Agent owe the Seller in exchange for that payment? Answer can’t be squat, because the Buyer Agent represents the Buyer ONLY.

Don’t feel singled out there, Allen. Most think the way you do and that thought process goes back to sub-agency when all agents represented Sellers.

I represent Sellers all the time. I just know that when I’m representing a Buyer, that the Buyer is paying me and not the Seller and when I represent a Seller, the seller is paying me. There is just no other way to get on track, until we view the world of real estate in this manner.

When a Buyer pays $900,000 for a home, he is paying $27,000 of that money he’s bringing to the table to his buyer’s agent. The seller is taking his cut, $873,000 and paying his listing agent and other expenses out of that. No reason you can’t see it that way and I shouldn’t have to move that $27,000 to the other side of the HUD 1 to prove it, but it’s a very simple line item transfer to make it so,

Hey Tim the Escrow Guy…can we effect this change for ten minutes and then move it back to satisfy the lender?

The seller absolutely pays the commission unless the selling agent has an agreement with their buyer for additional fees. At closing the sellers top line number is the sale price of the property. To say the Seller does not pay the commission is like saying the seller does not pay off the mortgage on the property. The seller claims the commission on his/her taxes, the seller pays excise tax on the commission and the seller even pays commission on the commission amount.

I have not listed/sold real estate in 15 years however I live and breathe this industry every day. As a seller I have paid 10’s of thousands of dollars in commissions and trust me I paid the commissions. I had a client that was upside down in a piece of property he had to bring $10,000 to closing I would have loved to hear you explain to him that he didn’t pay the commission.

-peace

I’m from Philly. We think if we say it often enough, and with conviction, it will someday become so! Can’t hurt to try

I don’t disagree with you in theory at all Allen, but if it’s going to be “not enough” than put $100. Some are trying it around the Country, just as some are trying 1% and IT JUST DOESN’T WORK! So let’s stop living in Dreamville and lets get back to what we CAN do right now without re-inventing the wheel.

You are just too seller oriented, and I am NOT a pure Buyer’s Agent. I switch hit, just as I assume you do. Your math, by the way is off but this is a comment, not a book, so let’s not go there.

Please stop saying the seller is paying that fee. The seller is stacking that fee on top of what he wants as a sale price. All sellers have always done that. You do show the seller his net sheet before he signs the listing agreement, right? So $291,000 is his side of the equation on a property listed at $300,000. The extra part is the buyers domain for negotiation purposes.

Put away your calculator and put on your thinking cap,,,now step outside of the box that says Seller Pays and re-think the whole thing backwards.

Getting max showings is WHY the seller offers ANYTHING, so it is not a whole different issue. Seller offers MAX to get MAX showings and prices accordingly. Buyer Agent and Buyer take that offering and negotiate it over at their table. Could be simple as Buyer offers $298,000 and agent reduces the $9,000 down to $7,000 as mutuall agreed between Buyer and Buyer Agent. No skin of Seller’s nose, so what’s the problem?

I love your matter of fact attitude .

You Say:
The listing agent cannot recommend to the seller that they only allow for 1% Buyer Agent fee in the sale price because it is not in the best interest of the seller for the seller to do that.

I believe the listing agent is doing a disservice by not recommending this.

I would love to hear why it isn’t in the best interest of the seller to pay the lowest possible expenses on the sell of his/her home. Commissions are paid on the sale price not the before commission price. In your example a $9,000 commission on a $300,000 sale. If it was like you stated the commission would be $8,730 based on $291,000 and seller would have another $270 in their pocket so that is $540 on both sides of the transaction. Plus the seller has to pay additional taxes on the commission amount at closing.

If your answer is because agents won’t show the property because the commission is to low then that is a whole different issue. This is the issue I’m trying to discuss and I feel this is the issue that needs to be addressed. Ardell you are a buyers agent why don’t you get your buyers to sign a buyer brokerage agreement for your services and what the seller is not willing to pay have your buyers pay the difference. Just close your eyes and imagine if all listings went into the MLS with a selling agent commission of 1%. Now how can that be bad for the seller?

) The listing agent determines his fee based on his knowledge of the market and expertise. So when Greg sets his fee, he will account for time on market of each listing separately. For one client he may set $10,000 and expect to have an offer within 30 days. For the next client he may set a fee of $15,000 and expect an offer within 60 days. If he miscalculates, then he under or overpriced for his services. Adjustments can be made or he can release the listing entirely. It’s a business choice.

What shouldn’t happen is that Seller A pays more because Seller B didn’t pay enough…that is what the industry has been doing since the beginning of time, and that really has to stop. Same with “Windfall Profits” on high end properties.

There is no “reduced” commission unless you think there is an “industry set fee”, which there cannot be, as that is “price fixing”. There can be no industry norm, only a business decision of what to charge made between the agent and then agreed to by the consumer. Get out of the “Entitled to x% ” mode.

2) When a listing agents prices a house at $300,000 and offers 3% mls offering, he is actually pricing the house at $291,000 and “allowing for a fee of $9,000″, the actual amount of that fee to be determined between the buyer and the buyer’s agent. The listing agent is NOT paying the buyer’s agent…the seller is allowing for an amount within the sale price.

3) The listing agent cannot recommend to the seller that they only allow for 1% Buyer Agent fee in the sale price because it is not in the best interest of the seller for the seller to do that. The listing agent must give the best advice to the seller. Within the current structure, the seller can offer 8% as long as the buyer is free to renogtiate that 8% with their buyer’s agent. The seller does not set that fee or pay that fee, he simply creates an amount within the asking price that is then negotiable between the buyer and the buyer’s agent.

It’s a new millenium…nothing needs to change except the way we think…out of the box.