It hits you like a ton of bricks the first time you hear it could take months (or even years) for a real estate lead
8 Memes You Need to See Before Asking Your Real Estate Agent to Lower Their Commission
By law, real estate commissions are negotiable. So you certainly have the right to ask a real estate agent if they’re willing to agree to a lower fee than they’re asking you to pay. Just know that some agents may be willing to accept a lower commission, while others won’t budge.
But before you dismiss an agent who doesn’t budge, and sign on the dotted line with one who does, there are a few things you might not be aware of that you should consider. Here are 8 memes that’ll help you understand where they’re coming from, and decide if asking an agent for a lower commission is the right choice for you.
1) Picture this…
Leonardo da Vinci’s “Mona Lisa” is (as the saying goes) a true work of art, and it’s worth hundreds of millions of dollars. Could someone paint you a version of it for less money? Of course! But how good will it be?
That’s not to say that an agent who charges less can’t do as good of a job as an agent who charges more, but it’s worth weighing whether the reason one agent is charging less is because their skills aren’t on par with the agent who charges more. Sometimes it pays to spend a little more on someone who’s a master of their art.
2) The more you know…
It almost seems like you can accomplish anything nowadays, with a little help from Youtube and Home Depot. You can fix your own car, replace a water heater, or sell your own house by watching some DIY videos and spending the time it takes. But it may take you a lot longer than it would take someone who knows what they’re doing!
So even if it seems like there’s not that much to selling a house, know that your agent is probably able to do it faster than you could—and making it look way easier than actually is—because of the years of experience they have.
3) People make mistakes…
Some people aren’t even satisfied with a lower commission, so they opt to try selling their own house in order to avoid paying any commission.
But even Dave Ramsey (who’s known for helping people be frugal and save money) says that you could easily cost yourself more money by making mistakes, than you saved by not paying a commission.
4) It all boils down to…
It’s always surprising how a big bag of spinach that barely fits into the pan boils down to what looks like barely enough to serve one person.
Real estate agents feel the same way about their commissions! It may seem like they’re getting a big pile of money, but in reality they only pocket a portion of it. A commission is divided up quite a bit; their broker, and the broker and agent representing the other party all take their “split,” and your agent also has to pay their own expenses. Whatever’s left after that can go toward putting a roof over their head, food on their table, and then hopefully a few bucks in their savings account.
5) Timely advice…
Sometimes an agent is able to get your house sold in a matter of days, or help you buy your dream house after showing you a few houses in one weekend.
While it may seem like they just earned a lot of money for a few hours of work, there’s a good chance that their years of experience and knowledge are what just saved you from wasting a lot of time, while helping you get the best results.
6) There’s no guarantee…
Real estate agents don’t get paid until (and unless!) they sell a house, and it’s not uncommon for even a top-producing agent to have times when they haven’t had a closing. They aren’t getting a paycheck every week, so they need to make sure that they manage and stretch the commissions they make over the course of months sometimes.
7) Expanding expenses…
It often seems like the more an agent makes, the more their expenses go up. Considering it takes money to make money, that makes perfect sense. An agent uses the money they earn from a commission to pay for marketing their listings, office supplies and equipment, insurance, gas, meals while on the road working all day, etc.
While it’s nice that they can write off a lot of their expenses at tax time, the bottom line is that they have to spend a lot of the money they earn just to be in business.
8) That’s all just the tip of the iceberg…
While those are some of the things to consider before asking if your agent will lower their commission, there’s many more things they do to earn their commission that are easy to overlook or underestimate.
So while you certainly have the right to ask for a lower commission, just make sure you’re aware of everything your agent brings to the table before you do!