So, here it goes….I think you should RAISE THE COMMISSION YOU WILL PAY AN AGENT WHO BRINGS YOU THE EVENTUAL BUYER OF YOUR HOME.  Is it contrarian?  Maybe. 

But, hear me out. Typically, home sellers agree to a total commission to be paid to sell their home. Many don’t realize that their listing agent then posts the percentage of that commission they are willing to share with the agent that brings a buyer that purchases the house.

As an example, you agree to pay a listing agent $10 to sell your home (depending on your market, the $10 may be a flat fee or a percentage of the sales price).  The agent posts the listing on their multiple listing service so all other agents become aware your home is now for sale. Your agent agrees to give $5 of the total commission to the selling agent.

Normally, the selling agent is unaware of the total commission.  They only know what they will be paid.

Now, let’s say your home and commission agreement is standard for your market…in other words, your home offers the same compensation as every other home in your neighborhood. In that scenario, your home doesn’t stand out.  If an agent had a buyer who wanted to live in your neighborhood, is there any reason to show your home over another?

What if you insisted that the selling agent was paid $6 of the $10 when you negotiated your commission?  Or even better, what if you agreed to pay $11 or $12 for a total commission and offered the selling agent $6 or even $7?  If all the agents who had buyers knew that they would make 20% more money if they sold your home, don’t you think you would see more traffic?  More traffic = more offers.  More offers = highest possible sales price.  Isn’t that worth paying a few more dollars in commission?

I am sure agents will argue that they have moral and ethical obligations to make all buyers aware of all their options.  However, common sense tells me they will be sure to make people more aware of similar properties in similar neighborhoods that pay them more money.  Wouldn’t you?

Pay higher commissions to selling agents in a buyer’s market…get more visitors…get more offers….sell quicker…and likely for more money.  Just my opinion….

Article from KCM Blog

/kh