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How to Deal with Real Estate Clients that Want to Cut Your Commission

Posted by Kristina Brunnler

May 20, 2017 6:00:00 AM

One of the most frustrating things to experience as a real estate agent is a client who believes your commission should be reduced. These clients are almost like FSBOs, because they’re not 100% convinced they need an agent. For most brokerages the commission is split multiple ways amongst the listing agent and broker and the buyer’s agent and broker. Furthermore, a portion of each agent's commission goes directly towards their brokerage or team’s marketing budget or overhead costs. Follow these tips below to work with these types of clients and assure your not wasting your time. 

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6 Ways to Deal with Real Estate Clients that Want to Reduce Your Commission

Provide Examples of Past Work (& why it was worth it to the client)

Bring with digital or print marketing materials that provide details of your track record. Be sure to include what services you provided (uploading the listing to the MLS, uploading the listing to real estate service sites, creating digital advertisements, print flyers, etc.) and how said services helped sell their home. Other important details include reduced time the home is on the market and higher sold prices.

Be All Ears

Even if your client is being unreasonable, be sure to listen to why they think your commission should be reduced. Refusing to discuss your commission might be a warning sign to the client of lack of confidence. In response, explain why cutting your commission would hurt them. Clients are not interested how much of your commission is going to your marketing budget or MLS board. Instead explain which of your services may be reduced and how that will affect their home's sale price and number of days on the market. 

Provide a Counter Offer

If you are willing to negotiate downwards, meeting your client halfways may save you a deal. Even if your commission is only slightly reduced, clients may walk away satisfied with the belief that they found a bargain. Other options include a free home inspection, home staging, or moving service.  

Turn Them Down

If your client’s reasoning why your commission should be reduced indicates a lack of faith in your services, maybe you should move on. It’s better to have lost a client than to have serviced an unsatisfied one. For more on knowing when to let go of a client,check out this helpful article. 

Offer Limited Services in Exchange for a Reduced Commission

After explaining what it is your services pay for, offer to reduce your commision in exchange for the elimination of some of those services. Be sure the services you do complete are still paid for by the commission check you receive. 

Offer to Reduce Your Commission if They Find a Buyer

This option is best for clients who believe they could easily sell their home on their own. Best of all clients are unlikely to find a buyer within their price range, thus validating your services.

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Topics: Practical Advice

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