Panelists Smita Singh, Cindi Hagley and Kraig Klaus discussed client demands to negotiate or reduce their pay at Inman Connect Las Vegas on Wednesday
Inman events are the best way to connect. Get insights and build your network in October at the virtual conference Inman Login where we will explore Fall Market Industry Guide. So join us in January for Inman Connect New York, in person or virtually. Book your tickets now, prices will go up!
Real estate commissions are a hot topic these days and agents are likely to face more and more clients asking them to justify how they are paid.
Panelists offered some tips for handling such conversations at Inman Connect Las Vegas on Wednesday during a session titled “An Agent’s Guide to Navigating Tough Conversations and Maintaining Your Commission.”
Lack of value is a concern when costs are on the table, according to panelist Smita Singh of the Seth Brothers team at eXp Realty in Houston.
“I’m not a tour guide,” she said. “I am an expert in what I do. And if that’s who you want, you’re gonna get it. And we’ll take all our commission.
Cindi Hagley, broker-owner of The Hagley Group in the San Francisco Bay Area, joked, “I’m happy to negotiate my commission. If you want to pay me more, who am I to stand in your way. The attendees laughed.
On a more serious note, Hagley pointed out that in his market, many brokerages offer very low rates.
“There’s a company that will settle for a $1,000 transaction, which is absolutely insane,” she said. “But you know, you get what you pay for. So you can negotiate my commission in advance. But on the upside, you’re going to have that pain, because when you trade my commission, you’re reducing the money I invest in marketing your home.
Kraig Klaus of Keller Williams’ Klaus team in the Phoenix area said that when asked to cut his commission, he just says “no” and moves on.
“Our market has quadrupled in inventory since April, so which is more important, what you pay or what you net?” he said. “And I always say if an agent is willing to cut their own salary and can’t negotiate their own commission, how can they negotiate the best value for you?”
Panel moderator Kendall Bonner, broker-owner of RE/MAX Capital Realty, played a role with the panelists.
Bonner: “Cindi, thank you so much for coming home today. I really appreciate you sharing with us the value of our home. But really, I don’t know if I want to pay 6% or 7% for my ad, will you negotiate with me? »
Hagley: “I will absolutely negotiate. But my question is, why wouldn’t you want to invest that amount and it really doesn’t pay off because you’re investing in me. I list your home, market it, stage it, then advertise your home on the internet, on TV, door-to-door, through newsletters – anything I Must do. So every percentage point or even half a percentage point that you’re trying to negotiate, that you’re more than welcome to negotiate, but that’s from the marketing that I do for your house. So my question is, is commission more important to you? Or is the number you clear at the end of the trade more important to you?
Bonner: “Absolutely the net.”
Hagley: “Okay, then sign the contract.” Participants laughed and some clapped.
Bonner then played a role with Klaus.
Bonner: “Thank you so much for coming out tonight. I’m looking at these numbers. I need $100,000 net and I think I could make it through your commission. Are you going to lower your commission?”
Klaus: “No. I want to get you there through marketing and selling price and experience and understanding how to present the home and how to get the most out of it. If we reduce our commission, we reduce our marketing budget. We spend a lot of money on marketing. We have the resources, the systems in place. We have been doing this for over 20 years. We have sold over 4,000 homes. We have covered all the markets. The average agent [has] five and a half years [of experience]. In our market, we haven’t had a balanced market for eight years. So most agents only saw a seller’s market. So when things get different and tough and the houses aren’t selling, that’s when the experts step up. This is when we become more valuable. And that’s where we’re going to win whatever we get. If we don’t at the end, we’ll have this conversation. I’m happy to have this conversation if I didn’t do what I said I was going to do.
The audience applauded.
Email Andrea V. Brambila.
Like me on Facebook | follow me on twitter