From the San Diego Union Tribune, dateline August 16, 2007:
Paleontologists studying pterosaurs had theorized that some the extinct flying reptiles fed by skimming along the water with their mouths open. However, a new analysis by British scientists indicates pterosaurs were too large and would have created too much drag to feed in this way.
And this is precisely why I see the traditional real estate agent not only surviving but thriving. Many predict the demise of the likes of me. They predict a future where I have been stripped of my MLS, at least in the proprietary sense, and where I have been stripped of my paycheck, rendering me crippled and ineffective chum.
Good, successful traditional agents find their sustenance in a much deeper ocean, while this point seems to be lost on the new fisherman, the alternative for-fee, for-less business models, and even the fish.
360-Marlow wrote last week about how Lennox Scott of John L. Scott Realty, speaking at the recent Inman Connect conference, “seemed unable to articulate why a commissioned sales person may be preferable to one paid on salary”. Well, let me give it a shot.
- The salaried employee is not required to front their own money (in my case, thousands of dollars per month per assignment) on the promise (not to be confused with “guarantee”) of some future paycheck.
- The salaried employee does not run the risk that, having worked on their employer’s behalf for months (and months and months), their employer will “change their mind”.
- The salaried employee does not bear the burden of their employer’s overhead.
- If the salaried employee’s employer is unsuccessful in selling their product to the end user, the salaried employee will still be paid for their time expended.
- The salaried employee wakes up each morning knowing they have a job, a job secured by a single interview, where their commission-based counterpart must attend job interviews on a daily basis. (Job interviews take time and money; let’s, just for fun, call them “non-billable hours”).
- The salaried employee is assured lunch breaks and days off. The salaried employee clocks out at the end of the shift.
- The salaried employee’s job description does not change each day requiring his ongoing personal investment in acquiring new and better skills to simply keep his job.
The fish may see it differently, but make no mistake. The business of real estate representation is extraordinarily time and money intensive and is becoming increasingly more complex. Not every “job well done” results in a pay day; conversely many of the agent’s more challenging assignments conclude with a net loss. If you want me to accept risk, there has to be at least the potential for reward. If you want me to work on salary, then you assume the risk, and you have effectively relieved me of much of my accountability, which one would argue is not in your favor.
Which brings me back to the pterosaurs. They set out to skim, and their proposition was to bring the fish to the surface by suggesting that deeper waters were such a scary place to swim. Depending on the tide, it may be good feeding, yet when the currents change, easy meals may be scarce. This business can be a drag. In the long run, I think we will see more pterosaurs, those offering less for less, coming to the conclusion under the weight of huge venture capital investments in a high risk proposition they are just too heavy to survive.
Jon Sonders says:
Yeah, but doesn’t, on average, the traditional real estate professional speed most of their time trying to acquire clients, and much less time actually servicing them?
August 16, 2007 — 12:40 pm
Kris Berg says:
No.
August 16, 2007 — 2:08 pm
Brian Brady says:
Make no mistake about it, Kris. You’re right. Redfin is so deeply-discounted that they won’t be able to survive.
Can you imagine what Kelmann could bring to the table for a full-service brokerage, though?
A fresh new perspective for marketing to consumers. I really liked his talk in SF.
August 16, 2007 — 2:09 pm
Chuchundra says:
I figure that real estate agents will go the way of travel agents. There will still be plenty of them around for people who need or want the full service treatment. They’ll have to work harder and smarter to convince sellers and buyers to use them because it will become easier to do transactions without one. There will be various types of low cost/no-frills services as alternatives.
August 16, 2007 — 2:13 pm
Thomas Johnson says:
Great post Kris. The contingent nature of our compensation requires a more robust payday. As long as the consumer is only willing to pay out of their equity at closing, there will be a limit to how low real estate compensation can go. Successful low cost models may emerge, but the risk of the transaction not closing will have to shift from the agent to his employer in some degree. I cannot imagine a seller fronting a cash retainer to a listing agent in return for a low discounted commission.
Chuchundra: I am not convinced that the travel agent comparison is a valid one. In a litigious society, the liabilities in real estate transactions can far exceed the value of of the property being transferred. One easy example: environmental problems follow the whole chain of title. In our transactions, the airplane never lands.
August 16, 2007 — 2:50 pm
Michael Cook says:
Thomas,
Do you really think real estate agents provide any protection at all from litigation? While the best agent certainly knows the laws, any deal with a hint of legal issues should be handled by a true real estate attorney. The agents have the competitve advantage in locating the right property and helping negotiate a good price. Aside from that I would stick with a solid real estate attorney, who will be surprisingly a small $ amount of the transaction.
August 16, 2007 — 2:58 pm
Marlow says:
Most Realtors, agents and brokerages carry errors and omissions insurance. Pay-outs from judgements of $500K+ are not uncommon.
Have you ever tried suing an attorney for errors or omissions?
August 16, 2007 — 4:19 pm
Glen says:
I could be wrong, but isn’t E&O insurance primarily for the protection of the agent/broker rather than the seller/buyer? You would still have to sue, but a least there may be deeper pockets.
August 16, 2007 — 5:30 pm
Kris Berg says:
>I figure that real estate agents will go the way of travel agents.
Apparently, what I wrote got lost in translation to what you heard (Blah, blah, blah, I am a real estate agent.)
>They’ll have to work harder and smarter to convince sellers and buyers to use them because it will become easier to do transactions without one.
It has taken me ten years to get to the point where I can say with all sincerety that I am damn good at what I do. And, make no mistake about it, what I do (when done right) is not easy, and what I do (when done right) is not something that an untrained, inexperienced, albeit well-intentioned person can pull off with equal results. Until you have 50 transactions under your belt, don’t even pretend to suggest that the real estate transaction is comparable to booking a cruise. You have no idea of what you speak. I’m on the verge of being offended at the implication that the waters I must navigate on a daily basis and that keep me up nights, the situations that I have to deal with before, during and after the sale that leave me feeling like someone has ripped my heart out and stomped on it, are anywhere close to the experiences of a tour booker. And hundreds of transactions later, I am still learning. A home sale transaction does not involve a tidy little checklist of procedural To-Do’s, and, yes, sometimes (much more seldom, these days), everything will go according to “the book”. But, more often than not, it is an intellectually, emotionally and highly costly challenge to see a transaction from contract consumation through to close. To suggest otherwise is to admit that you lack complete understanding of the process and the potential difficulties and obstacles.
Oh, and liability. At any given moment, an overlooked signature, a mismanaged communication log, or simply an unsatisfied client making a frivolous claim can result in legal action, and the distraction, expense and lost income during the process can be enormous. Further, if the travel agent is accused of screwing up a connecting flight, they will live to book another excursion. Agents, everyday, could and will lose their licenses and their careers. I had a managing Broker tell me once that, if you are in the business long enough, it is not a matter of if you get sued, but when. Fortunately, I have escaped this “eventuality”, so far.
All of this, however, is really off the intended topic. Each time I take a listing, I am laying thousands and thousands of dollars on the Come line. I am betting on my clients, and I am betting on myself, but no one wins them all. When people suggest my pay structure or my pay is unfair, I would suggest that these are people that do not understand my cost of doing business. My business and marketing expenses (ask Russell) would floor almost everyone in the room right now. That is the nature of the business, and question my value all day long if you will, but I know the value I bring, and I know how much delivering that value costs.
>Yeah, but doesn’t, on average, the traditional real estate professional spend most of their time trying to acquire clients, and much less time actually servicing them?
Again, No. That is the propaganda you are being fed, and that may be true for the new agent trying to establish themself, but not for me. Steve and I have never subscribed to the Bus Bench approach. We spend our money keeping our licenses and our skills current, we spend our money on business expenses (computers, phones, and all of those other mundane items), we spend it on gas over the 12 months we will be working with one buyer (yes, 12 months!), and we have the non-monetary costs to our personal lives, which are penciled in and rescheduled around our business lives. You may find it charming and amusing that I refer to my children as the Real Estate Orphans, but it is our sad truth. Yes, I signed up for it, but don’t suggest that I am skating, overfed and overrated. I and my family have made some difficult choices to allow me to do what I love and to do what I am good at. Mostly, though, we spend our money on marketing our listings, which we recognize (not so dumb, afterall) in turn market us.
>The agents have the competitve advantage in locating the right property and helping negotiate a good price. Aside from that I would stick with a solid real estate attorney, who will be surprisingly a small $ amount of the transaction.
Michael, does your attorney charge about $12 an hour? If so, you may have a point.
>In our transactions, the airplane never lands.
I love this line! Just this week, I have probably logged 8 hours involving transactions which long-ago closed.
Okay, I’m better now. Thanks for your comments, everyone! 🙂
August 16, 2007 — 6:22 pm
BR says:
Michael, you would be mistaken. Attorneys in most states that I am aware of are entitled to the full commission offered. Do you really think an attorney would rebate? LOL I’d try that negotiate your fee crap on an good attorney and you’d get a smile, handshake, and an escort to the front door.
Maybe some ambulance chaser would do it for a couple hundred dollars, but with any attorney, you really do get what you pay for- they might show you where to download the forms yourself.
And Chuchundra, my family owns a travel company which I worked at while I was in school years ago. Having experienced both of these professions, I would have to say I don’t agree with you in the slightest. Travel is nowhere near the same type of profession or level of dedication. Travel isn’t dealing with your major investments.
If it was compared really to another commissioned profession it would be closer to that of a stock trader, but I know that as stressful as my day gets, I am not downing antacids like a stock trader. If you look at stock trading vs. online trading, both services live side by side. The difference here is that e-trade never came out bad mouthing their own industry, creating a vacuum with consumers that really left no loyalty to either side of the issue like we have now.
This will heal, and hopefully we will all learn to co-exist and this hateful badmouthing will stop. But ignorant people will continue to spew the same myths such as the infamous 6% bologna, rather than the actual facts.
I have no issue with Redfin, I only have issue with their political method of marketing. Using inflammatory words and cheap political spin to boost your popularity at the expense of many many hard working folks is just sick- all of it is in the name of the all mighty buck.
What are we really bickering over? Would any of you really deny that Kris doesn’t work her ass off for her clients and wouldn’t do the same for you? She respects your right to shop and buy and/or sell on your own, all while folks attack her clients who solicit her services and call them ill informed. I’ve seen this happen to consumers who comment in defense of agents only to be called stupid in so many words. This is truly a disgusting reality. I am friends with and associate with a lot of agents who rebate. Most agents I know do whatever it takes to get a deal done or to make a deal work. But you have to have a place to start, and that place is 3%.
People who want cash back are the same buyers car dealerships love, “payment buyers.” A rebate is an incentive to buy; it covers costs for the cash poor, moving for the relocating professional, etc… there isn’t an agent on this planet that does not understand that. If a buyer runs into an agent that wouldn’t do it for them, then I do not know an agent that wouldn’t respect that buyer’s right to move on.
This has gone on long enough… the folks who are mad at NAR should write to NAR. If you are mad at YOUR agent, then tell them. But the folks here who are defending themselves in the name of all other agents are at an incredible disadvantage as they cannot defend everything that is wrong with every human on this planet.
August 16, 2007 — 9:01 pm
derherold says:
In germany the market share of FSBO’s is almost 50% – without horrible results f&252;r sellers or buyers.
In my opinion the *discounter* is only a menetekel for the declining position of the real estate agent and the most *low fee brokers* will disappear – but so will many agents.
Probably you get the *survival of the fittest*: the *good* agent will survive, the *bad* agent will shining my shoes.
August 16, 2007 — 9:06 pm
RBdeery says:
Kris…a friend of mine told me that rather than Zooming in to Zoom out and look at the BIG picture…The Big picture is that technology and particularly the internet has and is changing the way alot of industries are doing business today….Let’s face it…Today’s sellers and buyers have been empowered to do a large portion of the functional things that listing and selling agents have historically done.
Travel agents,stockbrokers,mortgage brokers,banks, insurance companies,airlines,retail stores,bookstores,music retailers, have all had to adjust to a new business environment that we live in….Like it or not ,the real estate IS changing.
August 17, 2007 — 4:39 am
Michael Cook says:
Wow, it got rough out here pretty quickly.
BR,
I am quoting you the prices I received here in New York and other transactions where I have used a lawyer. In New York my lawyer is charging me $2,000 to handle the transaction. My realtor was done as soon as offer was accepted and she was sure to tell us that (and stop taking our calls). At $600,000, the $2,000 fee is about 0.3% of the transaction value. Considering the fact that this fee is fix, if I would have bought a cheaper home it would have been higher. However, it would have never gotten close to 6% or even 3% of the transaction.
Even the lawyers for the commercial transactions that I do have been around the same percent of the deal. Perhaps I have just been lucky, but they are no where near 3% or 6% or the transaction.
August 17, 2007 — 6:21 am
Michael Cook says:
Derhold,
Is there a National Association of Realtors in Germany? Also, what is the lawyer per capita number over there. I would bet those two facts make a huge difference in the real estate market.
Marlow,
“Most Realtors, agents and brokerages carry errors and omissions insurance. Pay-outs from judgements of $500K+ are not uncommon.”
I dont want to insult realtors, but I would trust my lawyer to catch errors 1000% (not a typo, I mean 10x more) more than I would trust the average realtor. Lawyers are trained for years in catching details (I know I took law classes). Realtors have very little training in contract law and have very few hurdle rates to start practicing. Even the stupidest lawyer has to pass the bar, which is not a small feat. So while I am sure there will be some errors in thousands of transactions, give me the lawyer over the real estate agent any day when it comes to the actual transaction.
August 17, 2007 — 6:33 am
Michael Cook says:
“If it was compared really to another commissioned profession it would be closer to that of a stock trader, but I know that as stressful as my day gets, I am not downing antacids like a stock trader.”
While I agree travel agent is too simplistic, I think stock trader might be a bit of a stretch. Their performance is evaluated daily and the hurdle rate for becoming a stock broker is higher than most people think. Before you can even talk to someone about stock investing you have to have a variety of licenses that prove significant compentence and knowledge of the law and their is a very strong regulating body. Furthermore, jail is a very real option for brokers that dont do their job well, not just getting sued.
“The difference here is that e-trade never came out bad mouthing their own industry, creating a vacuum with consumers that really left no loyalty to either side of the issue like we have now.”
A better question would be why Redfin chose this strategy vs. another. Etrade and the like chose to empower consumers with low cost/low service. In that business stock brokers commisions are directly tied to their performance. While they certainly have a base, they dont get rich until they make their clients rich; therefore, clients have no problem paying them high commisions because they means they made huge gains. Bad mouthing would not work in this industry because its a pay for performance.
Redfin simply chooses to capitalize on realtors current reputation. I love a great realtor, but sadly there is a huge gap between the best of you and the worst of you. Until the industry has more Kris Berg’s than people like my realtor, who I will not name until my transaction closes, realtors will continue to be open to attack. The way to fix it is not by being defensive, but rather, getting rid of bad realtors. Pushing for more licensing, strong testing, split commsions, and better self-policing. I dont argue that great realtors put in a lot of work, I argue that there are just too many bad realtors out there.
Consider the fact that stock brokers never get compared to travel agents, but real estate agents do? While that is certainly not a good comparison, ask why that would come to someone’s mind? What are the commonalities the consumers see vs. the realities that you know?
August 17, 2007 — 7:02 am
Reuben Moore says:
This is a great post, but the comments are even better. Kris, I totally agree with your remarks – but with a huge caveat: They simply do not apply to most agents. The fact is, most agents are not Kris Berg!
I suspect there is a positive correlation between “good agents” and BloodhoundBlog readers. Good agents would seek out a place like this, whether it is Bloodhound specifically, or some other outlet (not necessarily internet-based). So dear reader, I further suspect my comments to not apply to you!
But that said, they do apply to most. I cannot speak to anyone’s experience but my own, but we are drowning in a sea of incompetence. And many (most?) agents do spend more time and money marketing themselves than their inventory, often at the expense of their clients. Even if you disagree with this, I think we can all agree that there are enough agents doing this to give our whole profession a terrible image problem.
And, it is this image problem that Kelman has seized upon and created Redfin. In a very real sense, we have created Redfin and it’s ilk. If everyone in this business was the caliber of Kris Berg and Russell Shaw, we would not be having this discussion.
Further, there is truth to the argument that technology and the increasing D-I-Y attitude has changed our market. I do not appreciate the Redfin business model, but I do embrace new models that a potential client can explore. These models simply offer a different value proposition. Value = Service/Price. There can be significant value in a discount model (for the right client).
As to whether you can successfully compare our business to travel or stocks, I do not think it really matters. Just as in almost every business, there will be more players on the low-end than on the high-end. Jeff Kempe talks about the “Nordstrom Realtor” and Kris Berg embodies this position and deserves to be paid handsomely for it. However, we are kidding ourselves if we believe that we can all survive on the high-end.
I trust (hope?) the incompetent agents do not survive. But even if they do not, down the road, most of us will be working in what we now call “discount brokerage”.
August 17, 2007 — 7:12 am
Greg Swann says:
> So while I am sure there will be some errors in thousands of transactions, give me the lawyer over the real estate agent any day when it comes to the actual transaction.
That much is actually funny to me. I’ve never had an attorney involved as an agent for the principals in either side of my transactions. A few times as principals, although we won’t represent attorneys and the few we’ve had on the other side have been no trouble at all; they had sense enough to stay out of the way. The trouble we’ve had with attorneys has been as, essentially, uninvolved third parties, and, in those circumstances, they have always seemed to me to be enemies of the transaction. In other words, the transactions have closed despite the obstructions thrown up by the lawyers. In any case, a lawyer working as an agent for one of the principals will do nothing to keep a transaction alive. At the first obstacle, he will wash his hands and cash his check.
I don’t know what it’s like — and I have no desire to learn — to work in a state like New York, where attorneys are routinely involved in real estate transactions. In Arizona, a rock solid deal doesn’t even need an attorney — you can do everything at the title company. The problem is that most deals are not rock solid, and it’s Realtors, not attorneys, who get them to the closing table.
We talked about this before. Here’s another fun story. Doug Quance has written on this, also. The Realtors writing here might consider telling more real-estate-in-real-life stories to illustrate the added value of working with a Realtor.
Here’s an interesting evaluation lens for Realtors: If you have a buyer at an open house insist that he wants to buy the home without a buyer’s agent of his own, whom would you allow to proceed without representation — that is, without a Disclosed Dual Agency? An attorney? No doubt. A professional or semi-pro investor? Probably. Anyone else? My answer would be no. Finding the house is the easy part, and buyers and sellers don’t know what they don’t know. My fee is a bargain, because, without the work I’m doing, the transaction may not close at all.
August 17, 2007 — 7:33 am
Phil Hoover says:
Salaried employees get paid for their time and showing up.
Commissioned salespeople get paid only when and if they produce results.
I would be delighted to be on a salary commensurate with my skills, abilities, and experience.
And, I would nearly giggle if I could get paid for everything I do on every transaction.
Problem is, some don’t work out and I get paid nothing for a lot of effort.
Perhaps I need to start charging $100/house to show property?
August 17, 2007 — 7:52 am
Michael Cook says:
Greg,
I was talking strictly in the legal proctection sense. And while I would have no problem going to the closing table with you, the AVERAGE realtor does not bring your same zeal for closing a transaction. Again, comparing the average real estate lawyer and the average realtor, as someone who has worked in real estate for a while I would take the lawyer. No offense to you or your people.
August 17, 2007 — 7:58 am
BR says:
Michael, can you post your stats for this comment:
the AVERAGE realtor does not bring your same zeal for closing a transaction
August 17, 2007 — 8:00 am
Michael Cook says:
Phil,
I think that would be a better model for everyone. That rewards the customer for doing additional leg work and it would rein in some of those time eaters that you all know and love. If realtors loved being salaried so much, why dont you all push for change. I am sure the consumers would not object. I know I certainly would not.
August 17, 2007 — 8:01 am
Lani Anglin says:
Ruben, thanks for your analysis- it is spot on. You finally said what Michael Cook has been trying to say- that many Realtors are terrible but likely none that write for or read Bloodhound (and it’s too bad- the people who SHOULD read bhb are not hearing these arguments).
Your argument about how Redfin has come to be is valid because this IS a changing environment.
The reason some comments inflame so many Realtors is that they are written with generalization, contradiction and venom. On the same hand, they often spark argument which is not the source of but eventually leads to intellectual debate which I find extremely valuable, especially to the 99% of readers who do not comment.
Ruben, you did not use stereotypes or loose opinion and your comment is very disarming- I hope you’ll come back to bhb more often!
August 17, 2007 — 8:06 am
Lani Anglin says:
And Phil- if you were salaried for your worth, no one could afford you! 🙂 And a salary for Kris or Greg- the salary would FAR exceed what a 3% commission would be!!!
August 17, 2007 — 8:09 am
RBdeery says:
Have spoken with 2 salaried agents working for iggy’s/Buyerside
Realty thatare doing great and love it….
August 17, 2007 — 8:12 am
Kris Berg says:
Thanks, Lani, BR, Reuben, et al. This wasn’t intended to be a “Look at me, I’m all that!” post. I’m not (Russell is), but I do put my heart and soul into this business, and I tend to get a little passionate and exceedingly frustrated when the perception of my role, my efforts and my rewards do not match reality.
August 17, 2007 — 8:25 am
Michael Cook says:
Lani wrote, “Ruben, thanks for your analysis- it is spot on. You finally said what Michael Cook has been trying to say- that many Realtors are terrible but likely none that write for or read Bloodhound (and it’s too bad- the people who SHOULD read bhb are not hearing these arguments).”
For the record, I dont try to say anything. If I say it I mean it, if I do not then I do not. While you may or may not agree, its preferred that you say that I am wrong or right, rather than tell me or others what I am “trying” to say.
While I do think the agents here are very good, in any profession there is room for everyone to grow. As usual if you dont feel what I am saying applies to you then it doesnt. If I use the general term realtor, it applies to the average realtor from what I have experienced. If I say realtors here, I mean realtors who I have seen writing and reading at Bloodhound. I am one consumer and give my opinion as such.
Just a public service announcement, for those who may have misinterpreted any of my previous statements.
August 17, 2007 — 8:40 am
BR says:
RBdeery I remember being in a bullpin style office about 5 years ago, there was about 80% of the office that sat around on a daily basis complaining about how tough it was to make money in real estate and dreamed of a salary real estate position. The other 20% we’re the top producers who laughed at that very idea. When this particular broker tried to go fixed income, he lost his 20% completely, that office dried up in 8 months and the entire company in under a year. Because, and what the broker learned was that the 80% he had retained in his offices still sat in the office doing nothing but answering ad calls – and not closing them. Ig/BS is a model that can succeed because they are lenders in reality, an all included venture. But every time I call sprint or any other large company, I imagine what it would be like in 20 years from now waiting on hold for the next available agent in india and trying to describe my frustrations with an unreasonable inspection. These are very very real on the ground things I experience as a consumer.
Now, those 80% in that office and other like it can do the work, they could close a transaction, they could demonstrate value, but what they could not do is be motivated, even if you paid them cash to be so.
And FYI- the brokerage I’m speaking of actually had capital that would make Zillow blush.
August 17, 2007 — 8:49 am
Michael Cook says:
“The reason some comments inflame so many Realtors is that they are written with generalization, contradiction and venom. On the same hand, they often spark argument which is not the source of but eventually leads to intellectual debate which I find extremely valuable, especially to the 99% of readers who do not comment.”
This comment is a bit more distrubing to me. Personally, I have never written with venom, though I can image some of my writing has been taken that way. I in no way mean to insult anyone’s profession or how they do their job.
Inspite of this I refuse to sugarcoat what I see as the truth. If something sparks a passion in me I write as such. I would like to think my writing generates conversation based on disagreement on an intellectual level rather than on simply arguing for the sake of arguing. If I am wrong I would hope people would feel free to share that offline with me.
I write and enjoy Bloodhound because of the passion of the people here for their work and their industry. Again, my assumption was that people wrote and comment because of that passion, not because they were offended by anything that I have said.
August 17, 2007 — 8:54 am
Michael Cook says:
BR,
“Michael, can you post your stats for this comment:”
No stats, just 6 years and a little over a dozen transactions. Take that for what its worth. Not even close to the 50+ Kris has under her belt.
August 17, 2007 — 9:04 am
Kris Berg says:
>Not even close to the 50+ Kris has under her belt.
Okay, I guess I am “all that”. 🙂 The 50+ number was my suggestion of how may transactions it takes to make an experienced agent. I’ve been involved a few more.
Now, I suggest we all take a chill pill.
August 17, 2007 — 9:30 am
mike davin says:
The flaw in your argument regarding commission only comp structures can be revealed when considering attorneys. Are attorneys who charge by the hour worse than contingency lawyers? Most would arge the better ethical attorneys charge by the hour,and the ambulance chasing creeps work contingency. [I am not implying RE agents are anything resembling the later!]
Do you want to your retail clerks paid on 100% commission and in your face everytime you hit the clothing rack? Or a car dealer who wants to be your best friend the minute you hit the lot?
Who do you get more objective advice from…the agent who is starving and desperate to force the consumer to accept the offer?
How about salary plus bonus…whould that be a happy medium?? Thats what we do at CataList Homes. $50k salary and another $30k to $70k in production bonus…and we pay for all expenses too.
Redfin will learn that a salary only approach will not work and turnover will creep in the their sales force. Bonus on consumer satisfaction will also be hard as their agents have way too much on their plates. Buyers always seem to be satisfied when you give them a rebate and set expectations low, but sellers are hard to please.
August 18, 2007 — 9:59 am