{"id":4348,"date":"2008-09-13T19:23:28","date_gmt":"2008-09-14T02:23:28","guid":{"rendered":"http:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/?p=4348"},"modified":"2008-09-13T19:47:11","modified_gmt":"2008-09-14T02:47:11","slug":"some-days-its-not-worth-chewing-through-the-restraints","status":"publish","type":"post","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/4348\/some-days-its-not-worth-chewing-through-the-restraints\/","title":{"rendered":"Some Days It’s Not Worth Chewing Through the Restraints"},"content":{"rendered":"

In addition to our discussions here at Bloodhound, if you’ve been reading the blogs lately, the commission debate continues.\u00a0 Jonathan Dalton’s post on Agent Genius<\/a> has recently spawned a long series of comments regarding how agents are compensated.<\/p>\n

One comment (below) got me thinking,<\/p>\n

“… I fully believe that my service is worth 6%. Clients in my area seem to be less concerned with getting a \u201cdeal\u201d on their commission rate than they are with getting an EXPERT to work for them.”<\/em><\/p>\n

I am not questioning the agent’s value – it’s hard to debate that consumers want an expert. The issue I have with the comment is “I fully believe my service is worth 6%.”<\/p>\n

Why? <\/p>\n

What is the significance of 6%?\u00a0 As we discuss the issue of commissions, why are we stuck on a percentage of the sale? Why isn’t the number 10% or higher – or in some cases, lower?\u00a0<\/p>\n

In actuality, if you’re cooperating with a buyer’s agent, aren’t you really saying you’re really worth only 3%?<\/p>\n

Indulge me for a moment as I share a little story…<\/p>\n

In early winter 2007, I happened to represent a client in the sale of his 3-flat in Lakeview – highly desirable area north of Lincoln Park – the building generated solid rental income. I listed the property and generated 2 offers within the first 20 days on the market. The first deal fell apart due to an over-zealous inspector who told my clients the building was worth no more than land value, <\/p>\n

Pardon me, but you’re an inspector, not an appraiser. <\/p>\n

But that was the least of my problems …<\/p>\n

The second deal blew apart 3 days prior to closing. The zoning certificate was incorrect – issued by the city. Chicago stated that that building was a 5-flat. My client was thrilled – LOOK! We can now ask for more! Um – excuse me, but no. When he purchased the building 2 years prior, the city correctly issued a zoning certificate indicating that the building was in fact a legal 3-flat. <\/p>\n

The attorney and I discussed Read more<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

In addition to our discussions here at Bloodhound, if you’ve been reading the blogs lately, the commission debate continues.\u00a0 Jonathan Dalton’s post on Agent Genius has recently spawned a long series of comments regarding how agents are compensated. One comment (below) got me thinking, “… I fully believe that my service is worth 6%. Clients […]<\/p>\n","protected":false},"author":47,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_feature_clip_id":0,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_post_was_ever_published":false},"categories":[5],"tags":[223,531],"class_list":["post-4348","post","type-post","status-publish","format-standard","hentry","category-real-estate","tag-agent-compensation","tag-disintermediation","no-featured-image"],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"jetpack-related-posts":[{"id":1478,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/1478\/separating-the-buyer-agent-commission-from-the-listing-commission-is-a-really-stupid-idea\/","url_meta":{"origin":4348,"position":0},"title":"Separating the Buyer Agent Commission From the Listing Commission is a REALLY stupid idea","author":"Russell Shaw","date":"May 28, 2007","format":false,"excerpt":"This is a continuation of Jeff Kempe's thoughtful post below. At first, I was going to reply to his post via a comment. But as I thought about it I realized there was way more I wanted to say. First things first: Welcome Jeff, Lani & Morgan! I'm delighted to\u2026","rel":"","context":"In "Dual Agency"","block_context":{"text":"Dual Agency","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/dual-agency\/"},"img":{"alt_text":"thinkingcap","src":"https:\/\/i0.wp.com\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-content\/uploads\/2007\/05\/thinkingcap1.gif?resize=350%2C200","width":350,"height":200},"classes":[]},{"id":733,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/733\/ask-the-broker-can-buyers-negotiate-for-the-buyers-agents-commission-to-be-paid-to-them-instead\/","url_meta":{"origin":4348,"position":1},"title":"Ask the Broker: Can buyers negotiate for the buyer’s agent’s commission to be paid to them instead . . . ?","author":"Greg Swann","date":"December 5, 2006","format":false,"excerpt":"We have been focussing on new construction and have been meeting directly with builders and their agents. We have not been represented by a buyer's agent up to now. Our strategy has been to save on commission by dealing with a single party. We recently looked at several resales where\u2026","rel":"","context":"In "Ask the Broker"","block_context":{"text":"Ask the Broker","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/ask-the-broker\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":615,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/615\/how-much-commission-should-an-agent-charge\/","url_meta":{"origin":4348,"position":2},"title":"How much commission should an agent charge?","author":"Russell Shaw","date":"November 8, 2006","format":false,"excerpt":"Theoretically any company could \"take over\" almost any market by offering their services at a lower price than any of the competition. And sometimes economic theorists like to calculate just how long it is going to be until it happens in various industries. Usually those calculations are just exercises with\u2026","rel":"","context":"In "Disintermediation"","block_context":{"text":"Disintermediation","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/disintermediation\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":492,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/492\/the-things-most-worth-talking-about-are-the-ones-no-one-ever-wants-to-talk-about-confronting-the-buyers-agents-commission-amidst-a-glacial-glut-of-real-estate-licensees\/","url_meta":{"origin":4348,"position":3},"title":"The things most worth talking about are the ones no one ever wants to talk about: Confronting the buyer’s agent’s commission amidst a glacial glut of real estate licensees . . .","author":"Greg Swann","date":"October 1, 2006","format":false,"excerpt":"I wrote this as a comment at Rain City Guide (which thread is very worth visiting), but I'm echoing it here:> Who pays the commission is all semantics, really. I would disagree with that. Buyers have been persistently misled about who pays the commissions, which skews their behavior. > The\u2026","rel":"","context":"In "Marketing"","block_context":{"text":"Marketing","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/marketing\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":2968,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/2968\/its-1000am-do-you-know-where-your-realtor-is\/","url_meta":{"origin":4348,"position":4},"title":"It’s 10:00AM; Do You Know Where Your Realtor Is?","author":"Barry Cunningham","date":"April 14, 2008","format":false,"excerpt":"Do you know that the Realtor who you have your house listed with is actually still earning their living as a Realtor? That was the concern recently voiced and posed to us by a concerned agent in Poinciana, Florida. \"In Central Florida, for example, over 50% of real estate agents\u2026","rel":"","context":"In "Real Estate"","block_context":{"text":"Real Estate","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/real-estate\/"},"img":{"alt_text":"Real Estate News } Real Estate Radio USA","src":"https:\/\/i0.wp.com\/www.realestateradiousa.com\/blog\/wp-content\/uploads\/2008\/04\/missing.jpg?resize=350%2C200","width":350,"height":200},"classes":[]},{"id":1283,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/1283\/who-pays-the-buyers-agent-once-weve-divorced-the-commissions-we-can-stop-worrying-about-it\/","url_meta":{"origin":4348,"position":5},"title":"Who pays the buyer’s agent? Once we’ve divorced the commissions, we can stop worrying about it","author":"Greg Swann","date":"April 9, 2007","format":false,"excerpt":"Joke Number one: Q: If you came upon the Buddha in the guise of a hot dog vendor, what should you say? A: Make me one with everything. Joke number two: Q: Top Drawer Listing Agent, why do you charge a 7% commission to list a home for sale? 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