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ProOffer.com ties commissions to performance

Consumers can offer incentives for beating price targets
Published on Jul 22, 2008

A new Web site promises to connect home buyers and sellers with real estate agents willing to work under a "pay for performance" model that rewards them for obtaining the best price for their clients -- or penalizes them if they fail. While other Web sites let agents compete for clients by negotiating discounted commission rates and rebates, ProOffer.com adds another twist: optional incentive bonuses that kick in when an agent closes a sale that beats an agreed-upon "trigger price" or time deadline. If a home is expected to sell for around $1 million, for example, an agent might offer to represent the seller for a base commission of 2 percent of any proceeds up to a $950,000 trigger price, plus a 20 percent cut above that target. If the home sells for only $900,000, the agent stands to earn $18,000, compared with $27,000 under a traditional 50-50 split of a 6 percent commission. But if the home sells for $1.1 million, the seller would pay their agent $4...

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