How many times when you're talking to a potential seller, do they bring up commissions today?
That conversation is probably happening more often than ever before today because it's a hyper competitive market. We're seeing a lot more commission conversations and people trying to negotiate our commissions to some degree.
So I had this great quote that was given to me by a Ninja student. Ninja is a great program. If you haven't taken the ninja class, highly recommend you do it. I've done it for my agents and brought them in twice to teach to my group. But they had a great quote here for dealing with the commission conversation.
So here's the quote (and it's so good):
"Hey, let me ask you this. I totally understand you're asking about commission but let me ask you just a quick question around that:
Do you believe that your house is gonna sell for a fixed price or do you believe it'll sell in a range of value depending on the negotiation...
In 1918, a guy named Ivy Lee was approached by Charles Schwab. Now, when we hear the name Charles Schwab, we might think of the Charles Schwab we know today who invested and traded stocks. But this isn't the same Charles Schwab.
Charles Schwab at that time was one of the most wealthy people in the world. He owned Bethlehem Steel and steel was, of course, a huge deal. So he was a hugely successful entrepreneur.
And so what happened with Ivy Lee and Charles Schwab was Ivy was a consultant — like how we have consultants and coaches today.
Anyway, Schwab came to him and said, "Hey, I want to increase my managers' efficiency and productivity as well as my proficiency and productivity. I want you to give me your best idea. What's it going to cost me?"
So Ivy being a smart salesperson, did a couple of things.
First, he said I'm not going to charge you anything. I'm just going to just give you the idea and then you can pay me what it's...
My friend and superstar REALTOR Adam McGrew recently shared a unique concept that he uses when talking commissions with sellers. He focuses his script around what the competition is offering and how the seller can be more competitive in the market.
His first step is to print a map of the area along with a list of properties that are currently for sale near the new listing. He then researches the compensation offered to buyers agents and highlights this information in his presentation. Next he asks the seller a simple question "So, you do want to be competitive, right?"
Not only do most sellers want to match the current compensation offered to buyers agents in the market, many want to incentivize buyers agents and encourage more showings by offering a higher compensation percentage.
Watch the video for more details...
Will you discount your fees so I can buy this house?
A conversation that is happening more and more frequently is when a buyer asks you to reduce or remove your buyer side commission on your listing and pass the savings on to them.
Their argument is that they will simply "represent themselves". Of course the reality is that you will still be the one writing the offer, negotiating the sale, opening escrow, arranging financing, attending inspections, negotiating inspections, attending the appraisal, and attending to a million other unforeseen bumps along the way until you reach a successful closing.
So how do you respond to this request? Watch this quick video for three scripts to use in the field.
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