I have this crazy notion that I am going to sell my home and pay a fair, fixed-price commission to both my listing agent AND the buyer’s agent. No 6%, no 5%, just a nice cold hard chunk of cash, independent of the selling price of my home. That would be quite a trick.
Now, there are a lot of flat-fee/discount brokers in the real estate industry. They have been around forever. Why they do not have more market penetration, I have no idea. So, they can save me money on the fee paid to my listing agent. But, all these discount listing agents have one thing in common: they all suggest/recommend that I pay the buyer’s agent the full amount (i.e., 3%). The problem with that, of course, is a mathematical one. For me to save serious money on realtor fees when I sell my home, I have to realize savings from both the seller’s agent AND the buyer’s agent. Otherwise, my savings are almost inconsequential. So, what would be so terrible about offering a flat fee to the buyer’s agent?
Talk to any listing agent and they will tell you the problem with offering less than customary commission to the buyer’s agent is that they will steer their buyer away from your home and show them homes that are more profitable for themselves. But what if my home is the ideal home for their buyer? I thought to myself, “A Realtor™ would never do that.” Now a real estate agent might, but not a Realtor™. What is the difference? A Realtor™, as they are so quick to point out, abides by the National Association of Realtors (NAR) Code of Ethics. And what does their code of ethics say about showing my home with its less than customary commission? Well, let’s read it together:
The duty obligates a real estate broker to act at all times in the best interest of his principal, to the exclusion of all other interests, including the broker’s own self interest.
I feel like it is that moment in the movie A Few Good Men where Tom Cruise’s character asks Jack Nicholson’s character, “Why the two orders? If the men were given the order that Santiago wasn’t to be touched, and your orders are always followed, why was it necessary to transfer him off the base?”
If Realtors™ abide by a code of ethics which prohibits them from steering buyers away from my home, and Realtors™ always abide by their Code of Ethics, why is it necessary to offer full price commission to attract them to my home? Why the two orders?
These discount listing agents must be mistaken. A Realtor™ would never do that. I can rest easy now knowing that every Realtor™ representing a buyer in my neighborhood will show my home with same alacrity as every other home.
But just in case, to learn how ReaListing makes unethical buyer’s agents a thing of the past, click here