Real Estate Commission Reform -- that was the name of the program I created back in 2011 that would disrupt the way real estate agents charge their seller clients. However, it turned out to be an epic fail. A brilliant idea I was offering full-service representation complete with a home staging consultation, interactive floorplans, a custom website, professional photos and everything else you get with a full-service agent for $4,500 or 3 percent, whichever was less (this did not include the additional 3 percent that would be offered to the buyer's broker). I was putting a cap on the total commission I charged to list a home. If your home sold for $500,000, as your listing agent, I would receive $4,500. A $200,000 sale would still pay me $4,500, but a $100,000 sale would only pay me 3 percent, which is $3,000. My sales pitch was simple. "I do the same amount of work for a $150,000 home that I do for a $300,000 home. So why should you, Mr. and Mrs. Seller, be forced to pay more s...
- Contrary to what several companies in the real estate industry want you to believe, the general public is not seeking a change to the traditional commission structure.
- Consumers feel there is a catch when you offer full service at a discounted price.
- When alternative brokerages fail, it reinforces the fact that the traditional real estate model is the best path for growth and success within the industry.