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Old 05-15-2018, 12:15 AM   #8
Travis Munroe
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Join Date: Feb 2009
Location: Calgary
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Quote:
Originally Posted by Hackey View Post
I definitely realize the commission paid compared to what you put in your pocket is drastically different but the money out of my pocket for example doesn't change. If you pocket $4,000 out of $10,000 I still have to pay $10,000. That is kind of the hurdle I'm trying to understand.

Not sure if you are willing to say here or not but where exactly do you spend thousands of dollars marketing the property? I imagine pretty much everyone these days searches for homes either online through various websites and/or has their realtor send them properties. What types of marketing can drastically increase the eyes on your property? While I do see the benefit of using a realtor I'm also asking myself is it worth $10,000+?
But the money out of your pocket does change...

If 4 out of 10 potential buyers are viewing your property because 6 out of 10 aren't interested in paying a commission then you just decreased your odds at an offer by 60%. If you are going to offer a commission which is commonly seen on the MLS system and the buyer isn't going to have to make up the difference then you will have 10 out of 10 showings. Do you think this could change the odds of selling or odds of seeing multiple offers?

Do you think that property A with $3,000 in marketing is likely to be seen by more people than the exact same property with $500 in marketing?

Do you think that I could negotiate a better price for your home than you could?


There have been different brokerage models since I started in this business. It is nothing new and it will continue to evolve. They pop up everywhere in a good market and many fizzle out in bad markets. Many models rely on listing volume while others rely on the final sale. It is not as if specific models are some huge secret that the consumer is not aware of. RE/MAX lists over 43% of properties in Calgary with the second closest brokerage being around 11% (rough February 2017 figures). I don't think all of these buyers or sellers are choosing to work with a certain office because they are not aware of the others but perhaps a certain style fits their needs more. Perhaps $10,000 more in commission is worth it if 2 realtors feel a final sale price is going to be $15,000 apart. Perhaps $10,000 is worth knowing every buyer is going to view your home because they aren't paying out of pocket if they like it. Perhaps $10,000 is worth it to know that I don't see a penny unless your place sells and I have thousands of dollars invested in your decision to hire me.

Again, I finish with different models for different people. People choose different cars for different reasons, different grocery stores for different reasons, etc. How you look at the $10,000 difference is going to be different than how many of my clientele would look at the $10,000 and there is no right or wrong answer!
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