You pose a great question. Your listing agent has a fiduciary duty to use any and all legal and ethical means to best represent you in procuring a ready, willing and able buyer for your property. That includes using any and all means to cast the widest net possible to obtain offers.
As a Realtor, you take an oath to promote your client's needs above your own (commission in this response). But not all real estate agents are Realtors. So each agent make a mental choice to either abide by the code of ethics or not with each transaction.
Now if you take whatever you deem an appropriate number or percentage of agents that will place THEIR needs above their clients needs, they have buyers too that they represent.
So if you list at 7%, they see that BEFORE they show your property and a subtle hint or comment to their buyer may be just enough to tilt the scales into that buyer making an offer on your property instead of another. So, didnt your listing agent do thier job for you? He/she took advantage of a wider means of offering your property and it resulted in an offer to you FIRST.
Now lets look at this in real numbers. We have 5 homes for sale in the same area, same size and same condition. All listed for $100,000. Realize that virtually every seller has wiggle room, its just a fact of life.
So the buyer's agenta arranges to show all 5 and sees the last one offers 3.5% commission and all others are at 3.0%. The agent suggests that the last property offers the best value even though they are all pretty much the same. The buyers agree. They make an offer of $100,000 and the seller accepts, the deal closes.
Now- the seller paid $1,000 more in commission than the other 4 offered. But this house is the one that sold, the other 4 are still on the market
Now would any of the other 4 sellers have accepted $99,000? Probably all would have. After a property has been on the market a while, the seller's usually reduce the list price and probably more than $1,000.
So, the seller paid $1,000 more in commission, stoped paying taxes, insurance, utilities and upkeep on his property sooner than the others did. That probably saved the $1000 "extra" commission all by itself.
You could have always lowered the price to what $95,000, $97,000?
So the buyer is happy, the seller is happy, the listing agent did his job above the other 4 listing agents and took advantage of ALL the agents out in the market place, ethical and unethical and completed his task ethically and successfully for his client. The property was sold first.
Sellers need to realize that they are either working with their agent or against them. You can't expect something for nothing, and be disappointed when you "get what you pay for".
If this were an easy job, everybody would do it. Its being successful that makes you good at what you do. Learning people, knowing how to take advantage of the market is what everybody wants an edge in, but only a few realize how to do it.
It matters not if the property is priced correctly or not in this question. While it needs to be in order to actually sell for lost of other reasons, we assumed it WAS priced correctly and the other 4 were as well.
I have 15 years experience and with 640 sides closed, I have a fairly successful resume. Consider that average agent sells about 8 homes a year.
There are plenty of agents that take the easy road, offer to "work" for a lower commission, overprice the property and hope someone else sells it or wait until the price comes down to market value and then it sells.
But that is only part of the puzzle. You need to pick an agent your gut tells you is the right one for you. Look untilou find them.
Kevin Cloutier, Commercial & Residential REALTOR
A HouseSOLD Name