Most Realtors in Fairfield County, Ct. have done an outstanding job of explaining to homeowners the ways in which a lower commission negatively affects the selling price of their homes. Some agents, however, continue to struggle with delivering this message. The list below should be extremely helpful to both agents and home sellers in that regard.
1. Low enthusiasm often equates to a lower price. A man was once asked, when getting a shoeshine, if he wanted the $2 shine or the $5 shine. When he inquired, “What’s the difference?” the merchant answered, “My enthusisam.” A significant part of the mission in marketing your home is creating enthusiasm and a sense of urgency among the Realtors and buyers. The alternative is a sense of apathy!
2. The agent within the firm lacks self-confidence. This can obviously be the result of many factors, including inexperience or lack of training. In any event, the agent doesn’t feel that he or she deserves a full fee and offers to reduce it. An agent who is confident in their skills and their ability to get your home sold is almost always to your advantage.
3. Marketing Plan. There are two basic types of real estate marketing plans. Active and passive. Newspaper ads and For Sale signs are examples of passive marketing. The agency places ad in the local newspaper and an open house sign in your yard, and then waits for a response. Active marketing is taking a clearly defined plan of action to identify, pursue and generate buyers for your home. Which of the two plans would you prefer?
4. Negotiating Skill. Negotiating skills are as important as sales and marketing skills. If an agent lacks the expertise and experience to substantiate their own fee, how are they going to negotiate the best price for you on the sale of your home?
5. Path of Least Resistance. The agent who reduces fees has a history of taking the path of least resistance. The agent is incapable of explaining the value of the services that they offer, or the value is just not there. Will the path of least resistance serve you well while negotiating with a potential buyer?
It Will Take Longer to Sell Your Home. Is there any doubt that even one of the above factors will likely result in a longer market time for your home? The longer a home is on the market, the more likely it is to become ‘shop worn’. One of the first questions that most buyers ask when entering a home is “How long has this house been on the market?” There is a direct correlation between sales price to list price ratio and market time.
A Builder’s Parallel
In some respects, selling a home is similar to building one. Builders in any given area pay virtually the same price for like materials and components. Labor costs are dependent largely on experience, skill and expertise. The obvious way in which to initially save money building a home is to “cut corners”.
It’s the same idea with selling a home. It has become essential for today’s seller to leverage the broad range of opportunities that are available through the use of technology – services and innovative marketing to procure the highest price when selling a home.
“Cutting corners” by cutting commission is a risky business.
How well versed are you in explaining the advantages of a higher commission to a potential seller client?
What other disadvantages of a lower commission can you think of that are not mentioned above?
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[...] a recent blog I wrote about the ways in which a less than full commission negatively affects a home seller’s bottom line. Today’s blog graphically illustrates that the same holds true for a Realtor. Below is [...]