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The Commission Question: What to Do When Asked to Lower Your Commission

Sep 9, 2019 by

Regardless of how long you’ve been in the industry, you’ve probably had at least one client ask you about your commission. How do you handle this question in a way that protects your income and grows your clientele? Here are some thoughts to consider when asked to lower your commission.

Mulling Over The Commission Question
When potential clients ask you to lower your commission, you need to remember that it’s just that: an ask, not a command. They want to find out if a lower commission is in the realm of possibility.

It’s your job to begin an open dialogue with any potential client who raises the issue.

Find Out Why They’re Asking
It’s important for you to determine the client’s motivation for asking. The client may know someone else who got a deal, money may be tight, or they just might not have a full understanding of what real estate professionals do.

Listen to Them Carefully
Clients want to know that they can put their faith in you and you’re not just looking to make some easy cash. When you ask your clients why they want you to cut your commission, make sure you genuinely listen to their answer with empathy.

Restate Their Concerns
When handling the commission question, John Grimes, a REALTOR® with Better Homes and Gardens Real Estate Metro Brokers, scales back the situation: “I paraphrase their statement to make sure that they understand I’m hearing them. That often calms people down. People are desperate to be heard and understood.”

Acknowledging your clients’ concerns aloud will make them feel as though you understand where they’re coming from.

Address the Issue
If your clients’ problem is financial, help them understand how much money they’ll potentially spend and earn at the close of the transaction. They may feel better about the commission when they realize what they stand to gain.

When the issue is that your clients don’t fully comprehend what agents do, you must walk them through the process. Your clients may think that your job begins and ends with listing their home on a multiple listing service (MLS) and putting a sign in their yard. You need to explain the value you bring to the table.

Demonstrate Your Worth
Be sure to up your merit with evidence.

Show them proof of your recent sales, including what your houses sold for compared to the asking price and how long they were on the market.

Providing your clients with testimonials from those you’ve previously worked with is another excellent way to help convince them of your worth.

The commission question doesn’t have to be a point of contention. If you pay attention to your clients’ concerns and explain your business clearly, it can be an opportunity to impress them.

For more information, check out the full article on the Quicken Loans Zing Blog.

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Backtrack for Existing-Home Sales: Can Lower Mortgage Rates Revive Them?

Apr 23, 2019 by

Existing-home sales in March tumbled 4.9 percent, coming off a February surge, the National Association of REALTORS® reports. At 5.21 million, existing-home sales last month underwhelmed by 5.4 percent year-over-year.

“It is not surprising to see a retreat after a powerful surge in sales in the prior month,” says Lawrence Yun, chief economist at NAR. “Still, current sales activity is underperforming in relation to the strength in the jobs markets. The impact of lower mortgage rates has not yet been fully realized.”

Encouragingly, however, 1.68 million existing homes were on the market, an increase from 1.63 million in February and 1.64 million the prior year.

“We had been calling for additional inventory, so I am pleased to see that there has been a modest increase on that front,” says John Smaby, NAR president. “We’re also seeing very favorable mortgage rates, so now would be a great time for those buyers who may have been waiting to make a purchase.”

“Further increases in inventory are highly desirable to keep home prices in check,” Yun says. “The sustained steady gains in home sales can occur when home price appreciation grows at roughly the same pace as wage growth.”

Across all house types (single-family, condo, co-op and townhome), the median price was $ 259,400, a 3.8 percent increase year-over-year. The median price for sales in the single-family space was $ 261,100; the condo median was $ 244,400. By region:

Midwest
Existing-Home Sales: 1.17 million (-8.6% YoY)
Median Price: $ 200,500 (+4.6% YoY)

Northeast
Existing-Home Sales: 670,000 (-1.5% YoY)
Median Price: $ 277,500 (+2.5% YoY)

South
Existing-Home Sales: 2.28 million (-2.1% YoY)
Median Price: $ 227,400 (+2.4% YoY) 

West
Existing-Home Sales: 1.09 million (-10.7% YoY)
Median Price: $ 398,300 (+3.1% YoY)

Currently, inventory is at a 3.9-month supply. In March, the average listing was on the market for 36 days, or six days longer than the prior year. Forty-seven percent of homes were on the market for less than one month.

Of the existing-home sales in March, 4.67 million were single-family—a dip from 4.91 million in February, and from 4.9 million year-over-year. Condo and co-op sales totaled 540,000, an 11.5 percent drop year-over-year.

Twenty-one percent of sales were all-cash, and 18 percent by individual investors. Three percent were distressed. First-time homebuyers comprised 33 percent of sales.

The hottest markets, according to realtor.com®’s Market Hotness Index, which is included in NAR’s report, were Columbus, Ohio; Boston-Cambridge-Newton, Mass.; Midland, Texas; Sacramento-Roseville-Arden-Arcade, Calif.; and Stockton-Lodi, Calif.

For more information, please visit www.nar.realtor.

The post Backtrack for Existing-Home Sales: Can Lower Mortgage Rates Revive Them? appeared first on RISMedia.

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