Part III in this multi-part series on “How Agents are Getting Paid in 2022” focuses on agents defending their commissions and ongoing commission lawsuits.
Defending Your Commission
Tiffany McQuaid is a big believer in agents having scripts that help them explain their value to potential buyers and sellers when, not if, they ask agents for commission discounts.
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McQuaid told Inman, “As a Realtor, your value should be conveyed clearly and concisely in regard to what makes you stand out over and above the others…if they (potential clients) are looking for an extreme cut and comparing it to what others will take, remember your value and worth. In the infamous words of Kenny Rogers, ‘Know when to hold ’em, know when to fold ’em, know when to walk away, know when to run!'”
Missy Yost, an eXp agent who leads the Yost Group in South Carolina, will offer her clients a discount, when/if her clients ask, from 6% to 5.5%. Yost does not, however, discount the buyer’s agent’s portion of the commission. Yost said, “…if I discount down to 5.5%, then I’ll do 2.5% and give the other side 3%. You need other agents. So you don’t want to discount the buyer’s agent portion.”
Yost strongly suggests that agents describe specifically where all the commission money is allocated and how that commission money is being used for the benefit of the client. Yost said, “I think after you explain it all to them (marketing, photography, technology, etc.), they (clients) do understand it a little better.”
Ongoing Commission Lawsuits
Tim and Julie Real Estate Coaching has discussed ongoing lawsuits regarding commission policies recently so we won’t take a lot of time here going over familiar territory.
Enough to say that two lawsuits filed last year allege that standard industry commission splits and practices violate antitrust laws. Another suit involving the US Department of Justice and the National Association of REALTORS® is questioning NAR about equal access and transparency concerning commission policies. None of these lawsuits has yet been decided.
When these cases are in fact decided, each one of these actions could have major impacts on buyer/seller agent and client commission policies and industry practices. When these suits are decided, successful, savvy agents know well how to adapt to changes if and when they come.
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Thanks to Inman.
