HOW TO GET 7%
COMMISSION
HOW TO LAND EVERY LISTING APPOINTMENT
AND GET 7% COMMISSION!
PRESENTED BY:
THE
CAREER
COMPASS
REAL ESTATE SUCCESS TRAINING
& LIFETIME LICENSE RENEWAL
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GETTING 7% COMMISSION
THIS TECHNIQUE IS NOTHING NEW, BUT CAN LITERALLY GET
YOU THE LISTING THE FIRST TIME, EVERY TIME. HOWEVER,
IT IS ALL IN HOW YOU PRESENT IT...
INDUSTRY FACT: Most listing agents price homes
knowing that there is going to be negotiation.
INDUSTRY FACT: In normal markets, 90%+ of all initial
offers are for some number OTHER than the full price and
the accepted offer is somewhere between the list price
and the initial offer.
INDUSTRY FACT: As unfortunate as it is, buyer’s agents
in particular favor homes that have higher percentages in
terms of commissions. Many make certain homes
priorities in terms of showing based on the buying side
commission
INDUSTRY FACT: Some listing agents do listing
presentations with the aspect of how they will cut
commission as much or more than other agents. For
example cutting the total commission down to 5% which
we will use for this example.
+1% to the price...
COMP PRICE:
+1%
NEW LIST PRICE:
395,000
3,950
398,950
93% OF 398,950 = 371,023
95% OF 395,000 = 375,250
THE 5% IS $4,227 MORE, BUT...
LISTING SIDE
BUYING SIDE
The 5% listing gets negotiation-based offers that typically start between 2-6%
below the listed price of $395,000. The agents negotiate the price to
approximately 4% below list. (NOTE: The negotiation takes time and runs
the risk of the two sides not coming to an agreed-upon price. In which case
the home may sit for longer than 30-60 days creating a situation where the
offers get even lower.)
$379,200
After commission: 379,200 - 5% (before expenses) = $360,240
Negotiated price: 395,000 - 4%
=
The 7% listing gets immediate full price offers from eager buyer’s agents
wanting the 4%, creating either a full priced sale or a bidding war from buyers
who have been convinced this is the best home for them by their buyer’s
agent. This also happens extremely fast with no negotiation and makes this
house the hottest house on the market.
$398,950
After commission: 398,950 - 7% (before expenses) = $371,023
Negotiated price: 398,950 - 0%
=
$410,918
After commission: 410,918 - 7% (before expenses) = $382,154
Bidding war price: 398,950 + 3%
=
OTHER AGENTS 5%
@2.5% = $9480
YOUR LISTING 7%
@3% = $11,968
YOUR LISTING 7%
@3% = $12,327
(Bidding War)
2.5% of 379,200
3% of 398,950
3% of 410,918
WANT AN ADDITIONAL $2,234?
“Mr. & Mrs Seller. If we go with this 7% plan and we do not get the offers that
are comensurate with what I have detailed here, we can always re-list the
house after 90 days at the 395,000 price and a regular commission. However, I
will do you one better. If my plan does not work, I will re-list your house for a
total of 4% (1/3) to fairly compensate you for your time and faith in my plan.
However, I am very confident I will not need to do so. Your house is going to
sell quickly!”
“However, Mr. & Mrs Seller, if and when my plan does work, if I can negotiate
your house into a bidding war where we get a price in excess of the list,
would you agree I have done more than my job in selling your house? If that
is the case, would you agree on an override commission beyond a certain
point?
Thus, if the home sells for 5% or more above the, original listed price, would
you agree to a 10% additional override of the excess to be added to my
commission?
EXAMPLE:
ORIGINAL 7% LISTED PRICE:
398,950
SELLING PRICE 398,950 + 5%:
418,897
$ MORE THAN LISTED PRICE:
19,948
10% OF ADDITIONAL FUNDS:
1,994 Additional Commission
TOTAL COMMISSION (3% + $1994):
14,561 (vs. 9,480 @ 5% 379,200)
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