You'd be surprised how many agents are making less than they should or deserve. It doesn't necessarily mean they're bad agents, it's just that they still haven't figured out how to control some aspects in the industry.
Today I want to talk about one aspect in this field that everyone greatly cares about - commission.
Get ready to know how to keep more of it, what are the ways you can do to get more of it to your pocket without having to negotiate it out to get the business.
What you'll see are NOT sneaky tactics rather these are better and different ways to present to your buyers or sellers of how important commission is to you as an agent and how you can frame the conversation more to your advantage.
We're all for fair splits that will compensate your VALUE without compromising your integrity in this business.
We're talking about win/win solutions.
3 ways to keep MORE of your commission
Saying the right words and in the right manner can really make or break a conversation, or closing a deal. There are different ways that we can negotiate commission other than just cutting it in a monetary value.
1. Offer services instead of cutting on your percentage
Stay at a certain commission rate if you're going out for a listing and without cutting a percentage you could offer a service such as a moving service, or whatever you want to do that would come out to your commission at closing.
Offering a service and keeping the percentage the same during the listing is always a good negotiating tactic.
2. Show the sellers your value
Explain to a seller that the commission, may sound like a lot but they also have to take into consideration of how much time you spent in marketing, how much money, how much outreach, how much of your time is worth compared to what they're willing to pay for the commission.
If you want an outstanding quality service you must also be willing to pay for such.
Having a discount is not always great, sometimes having it might compromise the quality of a product or a service.
You want to have a conversation about that.
It looks like a huge amount upfront but it's a good investment in the long run.
You can educate them about the things that sets you apart from the other agents:
- You have a huge social media following - you can promote a property that can reach more than hundred thousands of people
- You are part of a great community for realtors that has access to certain buyers that other agents wouldn't have
It's all about distributing your value and showing them what your value is in a monetary way to basically take that value and understand what it means in terms of paying out of commission for that.
3. Proper way of dealing in percentages
A lot of agents nowadays, allow their sellers to cut their commission in half right away.
So say, whatever state you're in, for instance in California you're offering 5% and 2.25 % on the buy side. If you offer, they automatically want to go to 1.25% or from 2.5% to 2%.
Have you ever wondered what happened to all those steps in between 2.5 to 2? Those are relevantly big jumps if you think about it.
Think of the fact that if you cut your commission per 1%, what about if you offer them just a monetary value e.g. $5,000 $7,000 or $8,000 at closing, would that amount of money be less than if you cut a percentage?
You can say to the seller:
I know there's a lot of competition out there but what if we stay at 2.5% and I GIVE YOU $8,000?
Sometimes, giving out anumber or a value like that is advantageous to you in negotiations because you're not cutting huge amounts per percentages. Try to work out the math on that and see if that works out to your advantage.
See at the end of the day, no matter how much great of an effort you put in closing a deal, if you don't get the RIGHT commission you deserve then it's practically wasted time. Yes we can look at it at a positive view, you learned a lot, made new connections but still - let's be honest with ourselves and realize what our true value is in this field.
So you have to practice these negotiating tactics:
- Offer services that doesn't cost much for you to give but valuable for them to receive
- Show the sellers your value
- Give monetary value right away instead of cutting in percentages
Remember: Get comfortable with it. Nothing is more awkward than a hesitant or a shy negotiator. YOU GOT THIS. With these useful tips you'll be able to properly utilize and even keep and save more of that hard earned commission.
If you guys have any other ideas about how to demonstrate value and how to have the conversation about whether or not your commission is valid and everything, shoot me an email at firstname.lastname@example.org and I'll put it into another blog post or another video and we can talk about.
I hope you guys have a great and powerful week and I will talk to you guys in tomorrow's video. See you then!
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