As quoted by GailSusan in the previous thread...
"I think that the public views real estate agents as being at the same level of abilities whether we've been in the business two months or ten years and whether we have six designations after our name or none. That is the real problem."

I agree. So... 'splain to me... why do we advise brand new agents to get out there and charge (let's say) 6% right out of the gate? Aren't my services as a 10 year veteran with lots of designations worth MORE than the brand new rookie who's never had a listing?

I was watching Million Dollar Listing the other day on Bravo where a young punk kid in L.A. went on his FIRST listing appt and was trying to justify his $96,000 fee (half of his 6% listing fee)for a $3.2M home. The sellers wanted to pay only 4% total (so the kid would get 2% or $64,000) and the kid was telling them that he was worth more than that. Huh?????

It's his first listing! NO, he's not worth it yet! I don't care how hard he works or even how much money he spends on advertising, my experience is worth more!

G'ahead... Argue with me!

Actually, I'm not going to argue with you. As a newer agent, I would tend to agree. My services are NOT worth what an experienced agent should get particularly on a multi-million $$ property.

For the most part my listings - the few that I have been able to obtain - have been on coops and small condos. I live in Westchester NY and the cost of living here and doing business here neccesitates a 4.5% commission on such properties IF I offer only 2% to the selling side. Unfortunately that rate is about par for the area. The fact is, that I would lose money on anything less, so I can't charge less. I emphasize that I am "hungry" enough to really work hard to market the property. Marketing costs money. I give them a taste of what it costs to advertise their unit then show them what I actually get to take home - and if they are at all reasonable, they recognize that it really can't be done for less. I emphasize that I am hungry enough not to treat their listing with benign neglect and that for their money, they will get more service than with an agent who has 6 or more listings.

I have saught out larger listings, but have not been successful thus far. There are a few top agents in the area that have a "lock" on these and I have noted that going after lower lying fruit is more productive at this point.

My rationale is that by providing good service to younger clients who are "laddering" up. I will have frequent business and referals which will open up the market for listing larger properties without "harassing" or intruding on the privacy of homeowners by door-knocking.

Because your Doctor is a rookie, do you ask for a discount? I thought having the "credentials/license" should be enough to be qualified to ask for full payment.
The same goes for the Electrician, Roofer or Realtor IMO.
p.s. when talking to a NEW agent at A2S @ $2,995, will you try to list for $2k or less?

I'd say you are worth what you can convince someone you are worth. If that new agent can sell themselves enough to justify a 6% commission, then good for them, they deserve it. If you can't, then you don't...no matter how many designations you have after your name.

I would pose this question...if the newby agent can sell themselves for 6%, how come the agents with 10+ years and multiple designations aren't pushing for 8% or 10%? "a new agent gets 6%...I've been doing this for 10 years and have X for credentials"...at the very LEAST - what did the new agent do that the veteran didn't that got them the listing appointment? I would say don't knock the new guy who got what you didn't...they probably did something you didn't do to get it...

then again..

maybe they just got lucky during some floor time.

but then if you were marketing yourself propertly (to that particular customer) they would have called you directly and not "the office"...right?

that's how i see it, anyway. you are worth what someone is willing to pay you. just like a home is worth on any given day, what someone is willing to pay for it.

With all the competition we find a lot of agents cutting commissions to get business. While there is no industry set fee, 6% used to be common. Now it is easy to find 5% or less commission structure.

What kills me is if I do 5% and split it 50/50, buyer's angets inevitably ask "What's up with 2.5% to the buyers side?" I just smile and say "I figured 2% just wasn't enough".

I figure that if an agent is out negotiated on their commission and can't justify the value of their services, how well will they negotiate the value of the homeowner's house?

Yes Pikes, regardless of your opening float, the consumer will counter with less. And contrary to your opinion of A2S, most agents don't start there. They would not be able to effectively handle the load.

Not to get off-topic, but you are not correct about doctors...they have a rookie period called RESIDENCY. 2-5 years of indentured servitude where the work 24 to 36 hour shifts at a teaching hospital for less than $40k a year. They are the workhorses for many hospitals. Lawyers have clerkships and are associates before becoming partners. Their salaries go up as they gain experience too. Many professions build in lower pay for "rookies".

"Value" is a relative term. Some of you are making the mistake of confusing the ability to "con" someone with negotiating ability. I do not think they are one in the same. Quite honestly, I am worth a great deal more than I was last year when I first started. I will be worth a great deal more NEXT year. I am not out to con someone into thinking I am worth what an agent with 20 years experience is....because I'm not.

I DO know that on lower priced properties(condos and coops) that the major players in my area pretty much just list 'em and forget 'em. They have bigger fish to fry. This is where I offer VALUE and can justify my commissions. I WON'T just list and forget a coop - because I truly want to get it sold! I will do more open houses and offer more services than a seasoned agent to get the job done.

Siberian Winter - you really 'get' what I was trying to say and I appreciate your comments!

Here's a quote from my book ... (which addresses your comment above about the loser agents who forget about their clients):

"If you are a new real estate salesperson, I don’t care how enthusiastic, how smart, how cute, how motivated you are, you are not as qualified to handle the marketing and sale of a home as a good, experienced real estate agent. Now, you might be more qualified than a bad experienced agent, and there are plenty of those. But, be honest, if you were going to hire someone to sell your home (or invest your money, design your logo or walk your dog), would you really prefer someone who has never done it before over an experienced professional?

Every agent goes through a rookie year. Somehow we convince people to give us the listing on their homes, and, in most cases, everything comes out okay. At the end of the year, you can breathe a sign of relief that you’ll never have to be a rookie real estate agent again."

This is silly (sorry but Jennifer you seem to have a hard time with this in reading some of your other posts). While you may be right in reguards to your experience then why should the rookie charge less....why don't you charge MORE. Probably because you think that 6% is enough, while I should not speak for you I will make this assumption. So maybe the rookie thinks it is enough as well. Truth is some 1st year agents in my office (yes RE/MAX has rookies) are worth a hell of a lot more then many 15-20 year vets on attitude and work ethics alone. Many newer agents who are tech savvy implement many new ideas and gadgets that enable them to get more exposure and deliver better customer service then some so called experienced ones. I could go on but you get my point...or not lol. As for the doctor a resident is the same as an apprenticeship, ie. when you are a full fledged doctor you charge what you can get away with or what you wish. Many residents in Canada leave go to the states and make much more money and get bonuses to do so, the market for doctors is better state side. So you get what you ask for, if you don't that means you aren't worth it based on your own presentation or the market says your not. Solution= get better at your presentation or move to another market or lastly learn to live with not thinking life is fair. Sorry Jennifer I really dislike this line of thinking....but I think I would like you personally. Cheers.

One more thing, not sure what life is like in your markets but here some of the most dangerous agents working are the ones with more then 20 years service. Most have no clue when it comes to current legislation and standards, many feel disclosure is what you do when you are about to make it with her, many really believe that the mls will sell the house and the internet is a nescessary evil....I could go on but just because you are still with us does not mean you have much more to offer, it may mean that but, it may mean your a greater liability to the unsuspecting consumer.

Tucker TX said:
What is my opinion of A2S? Please enlighten me.

I think Blanche said it best, without me explaining why I deserved to get paid for the work I did when I was a rookie.
http://www.realtor.org/rmomag.NSF/pages/BEvans200209162?OpenDocument

Sellers may not fully understand that commissions are divided four ways but I am sometimes puzzled when agents criticize the occurrence of a 6% commission or even 5% commission (5.1% being the average according to NAR). Do critics mean to say that the successful sale of a residence cannot possibly be worth 1.5% or 1.25% to the listing agent, even if a newer agent (assuming a 4-way equal split between brokers and agents for easy discussion)?

Are there any particular things someone with 10 years in the business can do that are unequivocally out of the reach of a rookie? A rookie can execute a great marketing plan to get a property sold. A rookie can have connections in certain social circles that veterans envy.

Jennifer, when you were a new agent, did you tell your seller prospects that you were backed by a broker with experience or that you had access to people who had more experience than you so that in effect the seller was getting all the experience they needed?

A rookie agent just can't possibly know as much as a veteran agent. There is NO WAY this can happen with a green newbie. The learning curve is very, very high the first 2-3 years. In NYS a mere 45 hour course and a simple test is all that stands between an individual and a license.

What I find odd is that many agents (on this very forum) will say that a rookie "shouldn't" attempt certain things. Most notably BPO's. Go on that forum and you will see just how much some of them resent anyone remotely new even attempting to do the work. I had a few comments that one shouldn't even ATTEMPT it for 4- 5 years. My take was that if you preview a lot of homes (which I do) and limit yourself to a specific geographic area that you are very familiar with, it is NOT rocket science.

Also, a lot of veteran agents crow about how the 6% people are paying is worth it because of the years and years of experience that they offer. Well....you can't have it BOTH ways. If people are paying for your EXPERINECE and EXPERTISE, then 6% doesn't make sense for someone with NO experience and only a 45 hour class behind them!

My guess is that there is a lot of protectionism going on for high commissions. A lot of veteran agents fear the impact of newer agents offering their services for less in order to gain a toehold in a market. After all, if we don't make, there is more business for you.

Finally, a lot of agents get precious little support from their brokerage. In the more cut-throat offices, all they are interested in is a couple of quick deals with nice fat splits from the rookie's SOI and are really hoping the person will fail in the long run. I was in a miserable situation for over a year. I didn't realize just how bad it was until I finally left.