'I will NOT reduce my fee'
Inman Community brief
By Inman News, Wednesday, October 1, 2008.Editor's note: The following is a reader comment made on the Sept. 26 Inman News column, "Premium service deserves premium pay."
"I will NOT reduce my fee. In fact, I will not even negotiate fees. My fee is my fee. I know the value that I bring to a transaction and if a consumer is smart enough to understand that experience costs, they don't even ask.
"I often receive calls from consumers who want to negotiate my fee even before discussing their representation needs. They want to negotiate the fee before I even tell them what my fee will be for their transaction needs.
"When presented with a complicated real estate transaction where the risk is higher than normal, or the transaction will require a higher level of brokerage services, my fee can be 1-2 percent higher than usual. If the consumer realizes that they need experience, they will pay it. If not, they don't get my services. Experience pays."
--Lenn Harley
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Submitted by Diane Cipa on October 1, 2008 - 1:31pm.
I absolutely agree with Lenn. The same applies for title insurance and settlement fees. My customers know they are getting superior service. I don't negotiate because all of my customers deserve the best, including a level playing field with price.
Submitted by Anthony Longo on October 1, 2008 - 1:46pm.
Lenn is your fee/commission a flat dollar amount or is it percentage based?
Anthony Longo
Founder & CEO, CondoDomain.com
Markets Open: Boston Condos | Dallas Condos
Coming Soon: Atlanta Condos
Submitted by Lenn Harley on October 1, 2008 - 2:36pm.
The consumer who understands contingent fees will not try to negotiate my fee. Don't forget that there is not only significant risk in most real estate transaction, there is also the element of the unknown.
Consider some of the risks over which agents have no control.
While we do qualify buyers, if the buyer loses their job, there is no transaction and no fee.
Buyers agents rely on sellers and listing agents for due diligence. If the seller can't transfer a marketable title, there is no transaction and no fee.
If a buyer can't get the interest rate they want and walks, there is no transaction and no fee. The earnest money can compensate the seller but not the buyer's agent.
If a buyer has a bad C.L.U.E. Report and cannot obtain market rate hazard insurance they may not get financing and there will be no transaction and no fee.
Contingent fees are high because the agent is taking the risk. No, I do not negotiate my fee.
Lenn Harley
Broker
Homefinders.com
http://www.homefinders.com
Submitted by Shannon Ziccardi on October 1, 2008 - 4:33pm.
Dear Lenn,
I feel your pain. I am a Notary Signing Agent and have seen alot during my more than 6,000 sigings. The one that probably irritates me the most is the escrow officer who expects everything (last minute, rush, multiple document sets, printing, delivery,etc.)and then wants to negotiate down my standard fee. I accomodate all I can, in every way I can but only negotiate standard fees/prices when a volume guarantee of work has been agreed to. After all, my fee is always passed onto the borrower as evidenced by the "estimated closing statement" anyways. Yet, some escrow personnel spend lots of wasted time negotiating for the cheapest Notary. I say that if office policy is for them to pay an experienced Notary Signing Agent $50, they will receive EVERYTHING they have paid for...and it won't be from this experienced professional. Hire an Experienced Professional Notary...you won't regret it!
"A Quick Note"
www.aquicknote.net
Submitted by Matt Sicignano on October 2, 2008 - 10:40am.
That's exactly what the big retailers said when Wal-Mart came to town! We won't reduce our prices, people will pay more for 'premium locations, products, fancier bags, etc...Premium services can command a premium price only where all other factors are equal....the current economy does not factor in premiums. When I had some rental homes painted-I negotiated a price about 15% lower than last year, and I expected the same level of quality, and got it! Who do you think set the price, not me, not the vendor-the market!One vendor did not accept the lower bid, but did add some extra services. If you don't want to lower your fee, then you have to give more-premium service at premium prices went out with the Sears+Roebuck business model. The market sets the rate! If the market defines premium service as worth a X% discount, that's what it is-your higher price for the same service will not be competitive.
Submitted by Sol Sek on October 7, 2008 - 8:02pm.
Brokers should be able to charge as high/as low as they wish. I COMPLETELY AGREE.
The disservice I see in the industry today is when agents ask sellers to drop their price, yet refuse to drop their commission to make up for lost time and lost buyers.
"I WILL NOT DROP MY PRICE UNLESS YOU DROP YOUR COMMISSION" is what we will hear in the coming days.
It's true that commission contingency is a risk that agents take and ought to be rewarded accordingly, yet asking sellers to drop thier price at a later date is a risk that sellers obsorb in this market. They may have passed up many buyers due to the incorrect pricing.
Just something to consider when assuming that agents are the ones taking the risk, alone.
Sol P. Sek
CEO/Founder, Forsalebyweb.com
Where You Name Your House Values!
Submitted by Bill Fooks on October 8, 2008 - 3:55am.
Bill Fooks
TFT realty Marketing Service
Warwick, RI
How come Inman News is not bashing the commissions being charged, aas to high, now that our services are needed. We have not seen many articles about the fees being to high lately. I wonder if most people know the real eatate business or just make a living talking about it, or writing about it.
What about the "Rookie" story. I guess she has a real job now, writing and talking about the business, and is doing real, Real Estate, part time, but expecting full time pay. I wonder about all this.How about you? If you have been full time for over 12 years, are you still at it? Are you able to charge more for your services because of the market shift?
Good things are on the way to those who stay true to full service and full fees. Our value has never been greater.