Home Selling in 10011>Question Details

Jc, Home Seller in 10011

Has anyone heard of brokerage houses in nyc (elliman, corcoran etc) going lower than .05 for their comission?

Asked by Jc, 10011 Fri Feb 13, 2009

Especially in todays climate. I am facing a loss due to the $ I would owe my broker on the comission of around 50K or more. Im trying to figure out the best strategy for getting my apt sold and NOT taking this 50k loss given todays prices at ~1000sqft for new loft condo bldg in the flatiron/chelsea. If anyone has current (jan09 or later) pricing info on recent condo sales, please post a link.

Help the community by answering this question:

Answers

18
I beg to differ Zack.

I wasn't denying anything nor was I implying on any common practice. I'm not taking any responsibility on how someone reads a thread or how they wish to interpret it.
Nowhere did I say that a listing at 5% or at 4% will get black listed by brokers. Let's get real here for a moment. Brokers don't get paid unless they close a deal. And just like everyone else, brokers have their own families to feed.
Let's use a simple hypothetical. If you were a broker and you were looking at two similar properties, similar price, size, etc….except that one was being offered at 6% and one at 5%. Considering that sales are being closed at a much slower pace and you don't have anything else lined up on your plate. Which apartment would you show first, the 6% or the 5%?

I love it Anthony.....1000 satisfied customers who saved money. I know of an insurance company that watches everyone, it even has a catchy tune, but ends up saving you a lot less at the end of the day.
Tell us. All of these 1000 satisfied customers did they all work with you, and did they all convince you to lower your commission to 5 or even 4%? How much of a fight on your end did you put up? I'm having a really hard time believing that you couldn't convince even a few out of the many to list at 6%. How does that work? Does your firm start negotiating at 5% and come down to 4% if a seller shows the slightest bit of resistance? Every seller laughed all the way to the bank and not one took a loss. Maybe someday I can help that many customers make money without a single loss, I’ll be sitting on a fortune.

Anyway….

If I were a seller, I’d expect the broker I’m interviewing to argue, fight me and convince me as to why he or she deserves the full 6%. Do you know many business owners who discount their services? Sure maybe once in a while, but not all the time. We get for what we pay. Let’s all not forget, that we never keep 6%, I don’t care how you try to cut the cheese.
2 votes Thank Flag Link Thu Jul 2, 2009
Anthony...Amazing claims...never having sold a unit for under asking...
I guess with lower commissions comes a higher level of profanity.
Professional agents act accordingly.
1 vote Thank Flag Link Thu Jul 2, 2009
Wow... generally real estate agents on these boards deny deny deny that they will blackball properties based on commission offered. Apparently NYC this is common practice according to Alen and Richard. Again, more of a reason why Real Estate Agent consistently is last or next to last in terms of prestige on the forbes list of careers.

At least this thread has been informative.
1 vote Thank Flag Link Thu Jul 2, 2009
"Price fixing is an agreement between business competitors to sell the same product or service at the same price. In general, it is an agreement intended to ultimately push the price of a product as high as possible, leading to profits for all the sellers."--WIKI

"The organized setting of what the public will be charged for certain products or services agreed to by competitors in the marketplace in violation of the Sherman Anti-Trust Act (15 U.S.C.A. § 1 et seq.)."

No Agreement between competitors, No Exchange of Pricing between Competitors...hence no Price Fixing occurs here
1 vote Thank Flag Link Thu Mar 12, 2009
I've never heard more bull*hit in all my life. I've owned a real estate firm in chelsea for 6 years now and never once charged 6%. Every apartment has sold AT or above asking. Times are tough, yes, all the more reason brokers will bring their clients to apartments charging 5% or even 4%. I can bring you over 1000 satisfied customers who saved money negotiating their commission from the beginning. Not a single one took a loss. In fact they laughed all the way to the bank while these same brokers feeding you 6% crap are selling the same units for a lower price.

Its about the right price and the right salesman. As my friends tell each other all the time, "Anthony can sell sand to a desert nomad".

-Anthony
0 votes Thank Flag Link Thu Jul 2, 2009
Richard...

A seller asking the question is not illegal. That person is not a licensed real estate agent.

Although you and I may not talk about pricing directly to each other, clearly, this is a tool that is intended to generate open discussion among many parties including real estate agencies from different companies. The info is out in the open. There is a reason you do not see real estate commissions advertised, right?

I don't think anyone really wants to be the test case. I can tell you it won't be me.
0 votes Thank Flag Link Thu Mar 12, 2009
Are these NYC real estate agents actually publishing their thoughts on specific commission rates?
Has anyone trained you on anti-trust, price fixing issues? If not, you should sign up for the next class offering- you need it!
Web Reference: http://optionsrealty.com
0 votes Thank Flag Link Thu Mar 12, 2009
Jc....

You can list for 5% with some Brokers, I even know of some who will list at 4% and Promise you the world. That being said, someone here hit it right on the nail. If there are ten $1 Million dollar apartments on sale right now and 9 are listed at 6% when you are listed at 5%. It's a good bet that your apartment will be one of the last ones to be shown to a buyer and if you are below 5%, keep your fingers crossed. If you were a broker, would you want to sell a 6% listing or a 4% listing? Less sales are being done right now, brokers are working twice as hard and just like anyone else, we have families to feed and business expenses to take care of.

Let me help you look at your scenario from a different angle. You have a $1M dollar apartment, you want to pay $40K commission vs the 5% $50K commission.
This is probably would would happen next. Your broker lists it at 4%. The Ten other apartments listed at 6% then 5% if sold, would be looked at and probably sold first. Then your apartment is on someones radar, since your apartment at 4% was the last to be shown, it's 3 months later, prices have fallen and now your $1M dollar apartment is no longer $1M. What would you do, you can't lower the price by $40K, because that doesn't say anything, if it says something it says that this seller may not be realistic. So you will probably have to drop it by 10% which is $100K, still listed at 4%. 5 months later it's summer, more apartments are on the market, yours looks old, it's at 4% and now you have to reduce it again, if you already haven't.
At the end of the day if you are able to sell at 4%, now your apartment is $100 to 200 thousand lower. $100 to $200K V.S. the $60,000 or $50,000 K you could have offered from Day One and increased your chances.

And Jc, Unless you purchased at the PEAK of the market, you aren't LOSING MONEY. If you purchased your apartment for example sake $700,000 and it appreciated to as far as $1,000,000 You are not losing $300,000. You are gaining anything you get above $700,000.


Good Luck.
0 votes Thank Flag Link Mon Mar 2, 2009
I am an Expert in the Chelsea area--1500+ Deals in 18 years. What you need to consider is that going under 6% can hurt you badly, agents simply show the 6%ers before they will show the lower ones, and some of the new Chelsea Developments are offering 4% and/or incentives to selling brokers. (That is the equivalent of an 8% total commission) you go less, you disadvantage yourself. Plus if the buyer comes through an out-of-town relocation referral it is very hard to do a deal at less than 6% since the referring agency gets a percentage, same with corporate relocations.
Ask yourself, do you have to sell or do you just want to. IF you can stay put, I would reccomend that, If I knew which development you bought in I might be able to tell you better, but if you are in the Western Part of Chelsea, you bought in an area that is rapidly changing, you bought the future (So did I). Plus you probably paid the transfer taxes, you will pay them again when you sell. I know it is not what you want to hear, but unless you are in a financial bind; try to hold on for a bit, maybe rent or (horrors!) get a roomate.
Right now Brokers have to work harder, spend more marketing and it takes longer--this is a time when comissions get higher, not lower. Stick with a larger agency, if you have a condo and it is new, the international exposure and contacts will be even more important--but I think you already knew that based on your question.
I am not trying to solicit your listing by my answer, Trulia asks that we do not do that in the Q&A. I would however be willing to provide you comps for reference--I feel for you, when you buy a new dev, you pay for 'newness' just like buying a new car. In a rapidly increasing market, this was not a concern.
0 votes Thank Flag Link Tue Feb 17, 2009
Wow! What a divergent amount of answers! Commissions are always negotiable and you can certainly try to find a "cheaper" agent or brokerage. However, you get what you pay for. I don't care what other realtors say "Oh, I'm cheaper but still as good". In today's market, houses take longer to sell, advertising costs money and it didn't get any cheaper. Sellers want their homes advertised everywhere under the sun but don't expect to pay for it. If you take cheaper listings, you need to take more listings to make money. The more listings you have, the less individual attention the sellers get. Good realtors charge more because they're worth it. Don't worry about what they get, worry about what you get!
0 votes Thank Flag Link Sun Feb 15, 2009
Jc,
If I'm not mistaken according to my training as a broker,a broker and/or an agent is not allowed by NYS law and Federal anti-trust laws to publish a commission rate. Caveat emptor!
0 votes Thank Flag Link Sat Feb 14, 2009
Commission is always negoptiable and lower fee does not have to result in reduction of services. There are many different ways to structure the commission.
0 votes Thank Flag Link Sat Feb 14, 2009
Commissions are always negotiable, keep in mind that if you use a low budget broker more often than not that's all they have to offer.
0 votes Thank Flag Link Sat Feb 14, 2009
JC
In the current economy you would be best served to interview at least two Realtors who have short sale experience and have them analyze your situation.

You are making assumptions and statements that show that you do not understand the current business climate. It would reduce your stress if you had a clearer picture of your options by someone that knows the facts.
0 votes Thank Flag Link Sat Feb 14, 2009
Keith Sorem, Real Estate Pro in Glendale, CA
MVP'08
Contact
Goto http://www.propertyshark.com to get ALL the most recent sales on your condo in the neighborhood.. Its free for first times users I think.

A comp is a sale within 1/2 mile and 6 months usually that is of similar design to your (ie square footage, design, doorman, etc).

If you have problem, you can send me the address and I will comp it for you and send you the information back.

Personally in this day and age I generally charge 4% commission and I think that the agents at either of those brokerages will gladly do he same for a fairly priced property.

Best of luck on your sale.
0 votes Thank Flag Link Sat Feb 14, 2009
JC,
Commissions are always negotiable. Interviewing and showing your home to agents/brokers from different companies should give you an idea of what they have to offer in the way of marketing and services and you would be best served discussing commissions and price at these interviews.. They should also be prepared to show you comparables and that should help you in making a decision..
Best wishes!
0 votes Thank Flag Link Fri Feb 13, 2009
I am sorry to say that I disagree with the answer given by Maureen below.

First and foremost, real estate agents are forbidden from discussing commissions including stating what another brokerage firm may or may not be willing to charge. The comment "some of the brokers are actually attempting to raise their commission" is really not appropriate or even correct as far as anyone knows. You need to interview more than one company and find out what they are willing to charge along with what services they will provide. You will need to do your homework on this one, sorry.

Also, the idea that she can help find an agent who will "discount on the fee if the agent both lists and sells the property" makes no sense either. The commission, whatever it is, is determined by the listing contract the seller signs in advance. This is setting you up for a dual agency situation and that may also not be in your best interest.

Unfortunately, in todays market, there are many sellers who are having to accept a loss if there are in a situation where they must sell. In most cases, the commission is the least of their problems. I do not know why you need to sell your property, but I would suggest you speak directly with several local professionals including your attorney to see what options are available to you given your situation.
0 votes Thank Flag Link Fri Feb 13, 2009
Hi JC,

In today's tough economy and with houses sitting on the market longer, some of the brokers are actually attempting to raise their commission. I am a Broker at Joyce Realty in Rockland County and through our Relocation and Referral division we have relationships with many of the NYC brokers. It is possible to negotiate with the agent for a discount on the fee if the agent both lists and sells the property. We can act as a referral agent for you--meaning we can find you a good broker to work with in the city. As a referring agent--you don't pay us anything, we would get a referral fee from the selling broker. The advantage to using a referral agent, is Joyce will keep in probably weekly contact with the listing agent, making sure they are on top of your listing.

My NYC RE agent friends say a 1,000 Sq foot condo should probably sell for near $1 million+ in your neighborhood.

If you would like more information, please feel free to call Maureen at 914-588-1873. Good luck
0 votes Thank Flag Link Fri Feb 13, 2009
Search Advice
Ask our community a question
Email me when…

Learn more

Copyright © 2015 Trulia, Inc. All rights reserved.   |  
Have a question? Visit our Help Center to find the answer