Tammy
Your profile says that you are a home buyer. The normal home buyer looks at 12 homes before making an offer. Did you know that (according to Trulia 27 homes have sold in the last three months?

In the length of time your home has been on the market, how many homes have:
1. Come on the market
2. Lowered their price
3. Gone into escrow
4. Sold
5. Expired.

Homes with the best value sell first. Homes that sell in the first 30 days sell closest to asking price. you need to add value. Look at the 10-12 homes that represent your direct competition and ask yourself "if I was a buyer, what would I think". Lowering the price is the easiest way to add value, but there are other ways. Compare the properties, come up with some other ways.

Add a home warranty, buy down program, include appliances, patio furniture.

While I don't push one home over another based on commission, there are a lot of hungry agents out there and it has been my experience that offering a higher buyer agent commission seems to help my listings to move...

You know Brian, the one thing I didn't gather in our MLS stats (Tammy, Brian and I are located in opposite ends of Idaho so our markets are different) was what you checked, the opposite of the stats I was seeking. I'll be pulling those stats for myself as well.

I know a few agents that are on this "kick" to increase the price and up the commission. THAT tactic doesn't make ANY sense to me especially when it doesn't change the 'price range' the property is in to better market it. I've been watching 2 such agents (who are extremely vocal in our local market) and am finding that their listings aren't even selling!!

Right now the market requires constant immersion in what is going on - watching stats (drilled down to subdivision by subdivision) daily - talking to people daily - staying on top of extraneous things such as the job market (unemployment, job growth, etc). I feel like it's changing on a dime almost every day - which tells me we are likely to be hugging the bottom (at least in our market) because I see some properties spiking up in value and others dropping down in value. It's a yo-yo right now.

Tammy,

I decided to look through MLS because, well, I like Christina and I found her answer both controversial and intersting. Interesting enough to look through the Treasure Valley's MLS system and see what the data refelected.

As far as homes in your specific zip code there were nearly 200 sold in the last 3 months. That's good news, homes are selling! The down side there are almost 630 single family homes available in your area. That puts the absorbstion rate (the length of time it will take to sell all of those homes) at around 9 and a half months. Keep in mind these numbers will vary as you narrow it down to more comprable homes. I'm giving you the big picture here. A good healthy market is an absorbtion rate of around 6 months.

So the thing that jumped out at me was the following line "Homes that are priced correctly AND have an increased commission sell (on average) 30% faster than those that are priced correct and offer an "average" commission." Looking at the data available in the MLS the homes in your area were offering a 4% commision actually took 44% longer to sell than the other on avearage.

This should tell you a couple things:

1. They offered the extra commission as an act of desperation not motivation (they didn't have the "AND" part of Christina's answer).
2. Price is king and all the other stuff marketing, incentives, added commision are just extras to drive them to get the job done faster.

Christina said it right if you'r going to offer extra commision to sway agents make sure it's priced right first so when they do bring a buyer the buyer sees it as a good deal as well. Don’t bother doing one unless you’ve already done the other. Remember as there is a lot of talk about commisions on this question that they are always negotiable and there is no such thing as a standard.

Hi Tammy -

My answer is going to be controversial, but I'm going to put it out there. First and foremost, you must make sure that your home is extremely competitively priced, accounting for any perceived negative your property may have. No matter how much you like something, or something doesn't bother you, another buyer may be the exact opposite. Listen to your agent even if you don't agree with perceived negatives.

Secondly, increasing buyer agent commissions can be very effective in getting a home sold. I sell a lot of homes and I often use this marketing tactic. Here's how I determine if a home is prime for this - what is the competition like? Is the home already priced very competitively (the lowest in it's 'like kind' available)? Does it seem as though it is getting 'lost' in all of the potential properties agents can show to their clients? Most especially, is it a home that has several of the same or similar floor plan available within a specific area radius?

No matter how many buyer agents tell you that they don't look for homes based upon the commission, the opposite is also true. Buyers often sign a compensation agreement with their agents. If the buyer can't get this compensation paid by the seller, some buyers agree to not see homes with a less than agreed upon offer of compensation. On the other end, agents working with buyers may share the difference in commission with the buyer (I've had this happen on several of my listings) - for example, BA shows buyer houses, buyer decides on one that offers BA 4.5% commission - BA agrees to split the difference between their base compensation (say that was 2.5%) and the offered compensation. In other words, the BA makes more money and the buyer now has 1% they can use towards closing costs or down payments.

Many have answered that buyers buy houses, not agents. But, agents remember and promote houses that they like - including ones that pay well. Agents make the connection through networking.

We often use an increased commission for BA's as a marketing tactic and it works extremely well. Homes that are priced correctly AND have an increased commission sell (on average) 30% faster than those that are priced correct and offer an "average" commission. The numbers get even worse the lower the offering commission gets (there are exceptions, like an insanely popular sub-division, or an REO home priced phenomenally below market, etc).

This also works on the opposite end of the spectrum. When it is a strong sellers market and everything is selling no matter what, the offer of compensation to a BA can be lowered quite a bit. You have to know your market and have a feel for what will or won't help or hinder sell the home.

I hope this helps you with your decision process.

Hi Tammy, price fixes everything. If you are paying out 3% then the commission should not in any way be the issue. In our market, we are finding that once homes hit their "strike price" they are selling and at a 1-5% discount to the then list price. Sometimes that "right" price is the initial price, and sometimes it comes after one or several price reductions. You'll k now when you get there - the public will tell you with increased activity and offers.

Review your overall marketing strategy - maximize the exposure as much as possible, revisit your photos -both quality and quantiy, and then look at price. For starters, calcuate what that addtional 1% in commission on your price equates to and reward the buyer by taking that right off the price.

Price is your answer. Good luck to you!

Best,
Jeannie Feenick
Weichert Realtors
Search and connect at http://www.feenick.com

The only time that I have seen increasing the commission to the agent help sell a house is when you find that agents are repeatedly talking buyers out of buying the property for something that really isn't such a big deal. For example their buyer loves your house, but it backs up to a road that might produce some traffic noise. I would talk to your agent about the feedback they have been getting from the agents that have shown the property to make sure that isn't the case. If the other agents are actually saying they advised the buyer not to pursue the property because of something minor that is the clue.

Other than that, agents can't make their buyer like a property. Lowering the price is the good ol' stand by, but if you feel like the property is already priced cheaper than your nearby competition, maybe you could add a buyer incentive such as up to $$$ towards buyer's closing costs, or a material allowance if several people have expressed an upgrade that they wish the house had, like granite counters, etc.

I hope this information is helpful for you. Thanks!

I'm in agreement with the previous comments. Offering incentives to Buyers agents is not as effective as offering something to the Buyer... they ultimately select the home. I don't know what price range your present home is in but you may consider the following if you are in a entry or moderate price level. Have you considered offering the Buyer a buy down on their interest rate? In lieu of a 1% increase in the S.O.C. or a reduction in price, you can offer a similar contribution to the Buyer towards buying down their interest rate . This may even reduce their monthly payment below that of a reduced price. Ask your Realtor if he or she could explore this idea with a preferred lender and see if this makes sense.

Offering to pay a certain dolar amount towards the buyers cost might help coupled with a selling bonus for the buyers agent. A flat fee might save you some money instead of a percentage. You also have to know what your listing agent is doing to expose your property and make sure that the property is in its best condition. Good Luck.

I have to agree with the previous answers.

I don't show properties, based on the percentage offered to the buyer's agency. I show properties that fit my clients parameters and needs. While a little extra percentage is lovely... anything over 3%, I donate directly back to my buyer (in my opinion 3% is more than enough for what I do) at closing. I have yet to have a buyer purchase one property over another, simply because it will afford me a higher commission. (see how silly that sounds?).

Jill and Mark said it best "Buyer's agents don't buy properties. Buyers do!" Buyer's incentives (that's the correct spelling Jill) work! The best buyer incentive is a good price. The better the price, the more chance you'll attract more than one potential buyer.

drop the price again., agents do not buy properties, buyers do! Drop the price again

It could help I would broadcast you are offering 4% or a flat state $2000 buyers agent bonus. I believe the $x,xxx would be more of a marketing tool than the 4% . SOOOOO determine what the other 1% would be place into "dollars". NOW that may help I do it all my listings does bring additional traffice. I have a dead line date all offers must be executed by certain time or the additional bonus would not be valid.
http://www.lynn911.com http://www.homes-for-sale-dallas.com

You can offer a buyer's agent all the incentive in the world and in the end it's the Buyer's who make the choice. It may increase traffic because agents looking to make an extra buck will show the home more often doesn't do anything for the buyer. I would look at Buyer incentives before offering more to their agent.

Hello Tammy,
I am of the opinion - if you are offering any incentive - offer it to the purchaser. They are fewer are farther between these days and they are looking for the sweetest deal they can get. Along with a deal - they are not willing to compromise on their home choice. If it isn't in mint condition, location ideal, favorable terms they will wait until the right property comes along. If you have covered all these bases - then the next thing to do is sweeten the pot.

I would rather see you reduce the price...The agent isnt the one who could use the insentive its the buyer!
Just my thought!