Any who knows me, knows I'm a true believer when it comes to buyer agency. Like I've said before, it was the way I was "raised" in this industry, taught by one of the best real estate agents I've known, Jerry Robinson. Jerry died a few years back and I miss him -- he was a master at relationship building.
Jerry's sincerity and passion for his work are what set him apart. He made me passionate, one of those times in my life when I met someone who changed me. Oh, I had interest in the beginning and I was eager to learn, but Jerry instilled confidence and passion.
One of the questions I received often in the beginning was -- Why will you try to get me the best price if it will reduce your commission?
Jerry's answer is the answer I use today. I have mentioned it in previous blogs, but I want to go into the full explanation today to try and resolve this great question once and for all. I will negotiate the price down and accept less commission because I want to be successful and have a long career in real estate based on long-term relationships and referrals. It's that simple
If I ever get to the point where I'm trying squeeze out as much commission for myself as I can out of every deal, I hope someone pulls me to side and says - "Mike, you need to find another profession."
My business is built on relationships and doing what I say I will do. Every satisfied client represents two or three clients in the future. Word of mouth marketing is the best marketing -- I think they call it "viral marketing" nowadays. If a buyer agent does what they say they will do, that reduction today of commision will create more in the future. A client who knows the agent was honest and fought for them is not going to forget it and when they know someone is looking for real estate, they will say -- "Use Mike." It real is that simple.
I can honestly say that I don't factor in the commission reduction when I negotiate -- it's irrelevant. The goal is to have a satisfied client. The goal is representation. The goal is referrals. It all has to do with a mindset that is grounded in long-term thinking and principled service. Jerry taught me that. He practiced it and he lived it -- he believed it and it works.
I know it's difficult for a hungry agent to look past the end of the month - I've been that hungry agent, but long-term thinking and integrity aren't subject to present financial conditions. A buyer agent committed to the principles of representation will not compromise, because they know that the future of their business depends on what they do today.
This isn't pie-in-the-sky idealism, it is good, smart business practice that builds relationships and ensures success. In some cases the buyer agent might be warning you against the negative effects of low-balling, asking for a ridiculously low price, but if you have a buyer agent who seems reluctant to negotiate and you suspect they are trying to get more commission from a higher price, FIRE THE AGENT!