Realtors Are Under Attack…Is It Fair? Read Below and you Tell Me
In recent news, Realtors are under attack, on who will pay their commissions and for how much will they receive, per this article published by CNN. If they are the listing agent of a property, the agreed commission is listed on this listing agreement and future purchase agreement with the seller but if the realtor is representing the buyer, the buyer’s agent may not be getting paid by the seller as this has been the case for many decades. As a consumer this could be interpreted many ways but what’s most important is for consumers buying real estate, to fully understand what Realtors bring to the table. Note: I did not write the following. I am only sharing it as instructed.
Below sheds light on this subject and something that should be shared with buyers and sellers:
There is a lot of talk in the news about real estate agent commissions. They LOVE what they do and they do it because they LOVE helping people but there is a misconception on what they do and how they get paid. It’s not a secret… so here you go!
The average FULL TIME REALTOR’s earnings last year was $31,900 @ 40+ hours a week. (Notice I wrote full time 40+ hours not 0-20 hours a week) which is well below the living wage. As a REALTOR they do not get paid an hourly wage or salary and they only get paid if they sell a home and it closes. They can only get paid by broker to broker. As an agent you could work with someone days, weeks, months, or years with no guarantee of a sale ever.
Essentially, they wake up each day unemployed going on Job Interviews and they deal with constant rejection. They dedicate time away from family, use their time, gas, pay for babysitters, miss dinner and weekend’s and rarely take vacations. They are on 24/7.
They constantly need to be on or could miss an opportunity. Once they do close a home, half goes to the other persons agent from the remaining half. They have lots of upfront expenses that must be paid out before they even get paid:
- Broker Splits and Fees
- Office rent and utilities
- MLS Fees
- NAR Fees
- Local Association Fees
- E&O Business Insurance
- Extended Auto Insurance
- Self-Employment Tax
- State Licensing Fees
- Advertising Fees
- Showing Service Fees
- Website Fees
- Assistant’s Salaries
- Showing partners
- Transaction coordinator
- Yard Signs
- Photographers
- Videographers
- Office Supplies
- Business Cards
- Property Flyers
- Electronic Lockboxes
- Continued RE Education
- Legal Fees
- Gas
- Income taxes
As a Listing Agent they have lots of tasks far more than just selling a home:
- Prepare Listing Presentation for Sellers
- Research Sellers Property Tax Info
- Research Comparable Sold Properties for Sellers
- Determine Average Days on Market
- Gather Info From Sellers About Their Home
- Meet With Sellers at Their Home
- Get To Know Their Home
- Present Listing Presentation
- Advise on Repairs and/or Upgrades
- Provide Home Seller To-Do Checklist
- Explain Current Market Conditions
- Discuss Seller’s Goals
- Share Your Value Proposition
- Explain Benefits of Your Brokerage
- Present Your Marketing Options
- Explain Video Marketing Strategies
- Demonstrate 3D Tour Marketing
- Explain Buyer & Seller Agency Relationships
- Describe the Buyer Pre-Screening Process
- Create Internal File for Transaction
- Get Listing Agreement & Disclosures Signed
- Provide Sellers Disclosure Form to Sellers
- Verify Interior Room Sizes
- Obtain Current Mortgage Loan Info
- Confirm Lot Size from County Tax Records
- Investigate Any Unrecorded Property Easements
- Establish Showing Instructions for Buyers
- Agree on Showing Times with Sellers
- Discuss Different Types of Buyer Financing
- Explain Appraisal Process and Pitfalls
- Verify Homeowners Association Fees
- Obtain a Copy of HOA Bylaws
- Gather Transferable Warranties
- Determine Need for Lead-Based Paint Disclosure
- Verify Security System Ownership
- Discuss Video Recording Devices & Showings
- Determine Property Inclusions & Exclusions
- Agree on Repairs to Made Before Listing
- Schedule Staging Consultation
- Schedule House Cleaners
- Install Electronic Lockbox & Yard Sign
- Set-Up Photo/Video Shoot
- Meet Photographer at Property
- Prepare Home For Photographer
- Schedule Drone & 3D Tour Shoot
- Get Seller’s Approval of All Marketing Materials
- Input Property Listing Into The MLS
- Create Virtual Tour Page
- Verify Listing Data on 3rd Party Websites
- Have Listing Proofread
- Create Property Flyer
- Have Extra Keys Made for Lockbox
- Set-Up Showing Services
- Help Owners Coordinate Showings
- Gather Feedback After Each Showing
- Keep track of Showing Activity
- Update MLS Listing as Needed
- Schedule Weekly Update Calls with Seller
- Prepare “Net Sheet” For All Offers
- Present All Offers to Seller
- Obtain Pre-Approval Letter from Buyer’s Agent
- Examine & Verify Buyer’s Qualifications
- Examine & Verify Buyer’s Lender
- Negotiate All Offers
- Once Under Contract, Send to Title Company
- Check Buyer’s Agent Has Received Copies
- Change Property Status in MLS
- Deliver Copies of Contact/Addendum to Seller
- Keep Track of Copies for Office File
- Coordinate Inspections with Sellers
- Explain Buyer’s Inspection Objections to Sellers
- Determine Seller’s Inspection Resolution
- Get All Repair Agreements in Writing
- Refer Trustworthy Contractors to Sellers
- Meet Appraiser at the Property
- Negotiate Any Unsatisfactory Appraisals
- Confirm Clear-to-Close
- Coordinate Closing Times & Location
- Verify Title Company Has All Docs
- Remind Sellers to Transfer Utilities
- Make Sure All Parties Are Notified of Closing Time
- Resolve Any Title Issues Before Closing
- Receive and Carefully Review Closing Docs
- Review Closing Figures With Seller
- Confirm Repairs Have Been Made
- Resolve Any Last Minute Issues
- Attend Seller’s Closing
- Pick Up Sign & Lock Box
- Change Status in MLS to “Sold.”
- Close Out Seller’s File With Brokerage
As a Buyer’s Agent they also have many tasks:
- Schedule Time To Meet Buyers
- Prepare Buyers Guide & Presentation
- Meet Buyers and Discuss Their Goals
- Explain Buyer & Seller Agency Relationships
- Discuss Different Types of Financing Options
- Help Buyers Find a Mortgage Lender
- Obtain Pre-Approval Letter from Their Lender
- Explain What You Do For Buyers As A Realtor
- Provide Overview of Current Market Conditions
- Explain Your Company’s Value to Buyers
- Discuss Earnest Money Deposits
- Explain Home Inspection Process
- Educate Buyers About Local Neighborhoods
- Discuss Foreclosures & Short Sales
- Gather Needs & Wants Of Their Next Home
- Explain School Districts Effect on Home Values
- Explain Recording Devices During Showings
- Learn All Buyer Goals & Make A Plan
- Create Internal File for Buyers Records
- Send Buyers Homes Within Their Criteria
- Start Showing Buyers Home That They Request
- Schedule & Organize All Showings
- Gather Showing Instructions for Each Listing
- Send Showing Schedule to Buyers
- Show Up Early and Prepare First Showing
- Look For Possible Repair Issues While Showing
- Gather Buyer Feedback After Each Showing
- Update Buyers When New Homes Hit the Market
- Share Knowledge & Insight About Homes
- Guide Buyers Through Their Emotional Journey
- Listen & Learn From Buyers At Each Showing
- Keep Records of All Showings
- Update Listing Agents with Buyer’s Feedback
- Discuss Homeowner’s Associations
- Estimate Expected Utility Usage Costs
- Confirm Water Source and Status
- Discuss Transferable Warranties
- Explain Property Appraisal Process
- Discuss Multiple Offer Situations
- Create Practice Offer To Help Buyers Prepare
- Provide Updated Housing Market Data to Buyers
- Inform Buyers of Their Showing Activity Weekly
- Update Buyers On Any Price Drops
- Discuss MLS Data With Buyers At Showings
- Find the Right Home for Buyers
- Determine Property Inclusions & Exclusions
- Prepare Sales Contract When Buyers are Ready
- Educate Buyer’s On Sales Contract Options
- Determine Need for Lead-Based Paint Disclosure
- Explain Home Warranty Options
- Update Buyer’s Pre-Approval Letter
- Discuss Loan Objection Deadlines
- Choose a Closing Date
- Verify Listing Data Is Correct
- Review Comps With Buyers To Determine Value
- Prepare & Submit Buyer’s Offer to Listing Agent
- Negotiate Buyers Offer With Listing Agent
- Execute A Sales Contract & Disclosures
- Once Under Contract, Send to Title Company
- Coordinate Earnest Money Drop Off
- Deliver Copies to Mortgage Lender
- Obtain Copy of Sellers Disclosure for Buyers
- Deliver Copies of Contract/Addendum to Buyers
- Obtain A Copy of HOA Bylaws
- Keep Track of Copies for Office File
- Coordinate Inspections with Buyers
- Meet Inspector At The Property
- Review Home Inspection with Buyers
- Negotiate Inspection Objections
- Get All Agreed Upon Repair Items in Writing
- Verify any Existing Lease Agreements
- Check In With Lender To Verify Loan Status
- Check on the Appraisal Date
- Negotiate Any Unsatisfactory Appraisals
- Coordinate Closing Times & Location
- Make Sure All Documents Are Fully Signed
- Verify Title Company Has Everything Needed
- Remind Buyers to Schedule Utilities
- Make Sure All Parties Are Notified of Closing Time
- Solve Any Title Problems Before Closing
- Receive and Review Closing Documents
- Review Closing Figures With Buyers
- Confirm Repairs Have Been Made By Sellers
- Perform Final Walk-Through with Buyers
- Resolve Any Last Minute Issues
- Get CDA Signed By Brokerage
- Attend Closing with Buyers
- Provide Home Warranty Paperwork
- Give Keys and Accessories to Buyers
- Close Out Buyer’s File Brokerage
In Closing…
You don’t need to buy or sell a home to support your agents real estate business – here are just a few simple ways to show your support!
By sharing one of their listings, sending a friend or family member their way, letting them connect you with agents outside their area for a broker to broker referral, or leaving them a positive comment or review, this helps them feel seen and supported😊
Best Regards,
101 Loan
Senior Mortgage Advisor
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