Is it a good idea to offer a bonus to the agent for the buyer to motivate them?

Asked by William Gregg, Portland, OR Tue Sep 4, 2012

I am selling a lower priced house. I am trying to figure out if I should offer a bonus to the buying agent. In other words, will it motivate him or her, and help to sell my house faster. A broker said it is not necessary, but with a $70,000 house I thought that it might help.

If yes, how much do I offer?

Finally, does it go to both the selling agent and the agency, or can it go just to the agent himself?

The state is Oklahoma.

Thank you.

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12
Jean Oxford, Agent, Branson, MO
Sat Sep 15, 2012
William,

Truthfully the percentage of commission is not a factor to me when I show homes. I am just trying to get the right property for my clients. I think you would be better served with offering a warranty on the home, carpet allowance, etc. to interest more buyers.

You can offer your bonus to one or both REALTORS. Just have the listing associate put it into your listing agreement.

Good luck on a quick closing!!
0 votes
Bo Martin, Agent, Guthrie, OK
Wed Sep 5, 2012
I agree with Bill. The bonus wouldn't normally make the difference as to whether an agent would bring a buyer to the table. You would be better served to spend this money on landscaping, etc to entice a buyer. Good luck
0 votes
Bill Eckler, Agent, Venice, FL
Wed Sep 5, 2012
Hi William,

Many agents will indicate that offering an incentive will make a difference. Realistically.....the normal fee for professional services should suffice for a compensation.

Since condition and price are normally big issues for today's buyers, our recommendation is to use incentive money to either lower the price or improve the condition of the home.

Good luck

Bill
0 votes
Maria Cipoll…, Agent, Coral Springs, FL
Wed Sep 5, 2012
If you offer some money to buyers, It could be even $1,000.00 toward closing cost, It will help you
to sell your home faster. Normally clients with FHA loans do not have the money for the closing cost.

Sincerely,

Maria Cipollone

http://www.Flahomespecialist.com
0 votes
Jim Simms, Mortgage Broker Or Lender, Louisville, KY
Wed Sep 5, 2012
In my market a buyer in that price range will often use an FHA loan, they have trouble coming up with both the down payment and closing cost. If I were the seller I would advertise that the seller is willing to pay the buyer’s cc & pre-paids. Good luck,

Jim Simms
NMLS # 6395
JSimms@cmcloans.com
Financing Kentucky One Home at a Time
0 votes
Ryan Hukill, Agent, Oklahoma City, OK
Wed Sep 5, 2012
You've gotten several correct answers here already. The thing to remember is that every market is different, and what may work in one market may be completely ineffective in another.

Here in the OKC market, in my experience, bonuses don't do much. What you have to remember is that people buy homes based on emotion and value. A Realtor is not going to be able (and shouldn't even try) to persuade a buyer to buy a home that's not a fit, simply because it will line their pocket.

Your goal should be to appeal to the buyer, not the agent. Assuming that you're already offering a competitive commission to the buyer's agent, you've got that part covered, so the next question is are you priced competitively? Your house is either seen as a bargain, or it's helping other listings look like bargains. If you've been on the market long, then it's likely the latter.

In most areas, especially the lower-priced areas, if your home hasn't sold in 60 days, it's overpriced, so your best move is to lower your price and get competitive, rather than trying to bait the agents. Let's be honest, the agents don't really have control over which house the buyer's choose. Most buyers are very educated and have a better feel for the market value of homes than sellers do. They've seen what's out there already, and that's what they're comparing your house to.
0 votes
Flora Qualls, Agent, Edmond, OK
Wed Sep 5, 2012
Bonus' offered usually do not make a difference. Selling a home has to do with the feeling and the perception that the buyer has when they see the home. Buying a home is emotional and has to have
a sense of value to them. It will motivate an agent to show your home in hopes that the buyer will like it.
If you still want to offer a bonus, nothing less than $1000.00 would be motivating. If you specify that the bonus goes to the buying agent in the MLS listing then it goes to the buying agent.
0 votes
Annette Law…, Agent, Palm Harbor, FL
Wed Sep 5, 2012
William,
You have identified a VERY EFFECTIVE resource for getting a home sold quickly.
However, it is critical this incentive is not structured as a 'Bonus.' These bonuses are the first things sacrificed at the negotiations table.

There are key components required for any successful marketing strategy including the sale of real estate. It is true, the method most real estate professional would use to deploy such a strategy would be a complete waste of time, thought, ink and space.

Real estate folks are people too...although some raise suspicion. They respond to EXACTLY the same promotional messages as everyone else. We however, incorrectly, believe ourselves to be 'special.'

It is true the home MUST meet the requirements of the buyer. To suggest a professional has no additional influence would truly identify a very ineffectual professional.

Do it the right way, and your home will be sold with the exact outcome an informed seller can expect.

Be aware, if you are selling this home yourself, which appears to be your intention, THERE IS ZERO hope this will make a hill of beans difference in the outcome. You do not know how to structure the deal to make it work beneficially for a professional to be persuaded by the offer. A real estate professional, who has experience with projection marketiong willl know how and possess the resources. to achieve a quick sale AND know what is legal in your state.

No, I won't share the details. That requires a signed listing agreement or consulting fee..

Best of success in the sale of your OR home.
Annette Lawrence, Broker/Associate
Remax Realtec Group, Palm Harbor, FL
727.420.4041
http://RealEstateMadeEZ.us
0 votes
Phil Rotondo, Agent, Melbourne, FL
Wed Sep 5, 2012
It sounds like a good idea; but it's ineffective.
As mentioned before, aggressive pricing is the key.
To agents, it's an added bonus if we can close fast.
0 votes
Josh Barnett, Agent, Chandler, OK
Wed Sep 5, 2012
Mr. Gregg,

Because the wording on offering a bonus is not always a guarantee to buyer's agents, you should offer an additional 1% commissions to the buyer's agent. This will help sale your home, as a bonus can be revoke, if the offer is not exactly what the seller was asking, whereas the commissions stay at what the commissions where offered when the buyer's agent showed the home.

The bonus is offered just to the buyer's agent and the 4% commissions should be offered only to the buyer's agent.

Hope this helps,

Josh Barnett, Realtor
Web Reference:  http://www.1ListingFee.com
0 votes
My NC Homes…, Agent, Chapel Hill, NC
Wed Sep 5, 2012
I have never found offering bonuses to agents a successful tactic and there are numerous disclosure laws in place to insure that buyers and sellers both are perfectly aware of what every agent is earning from the sale of real estate. Direct bonuses to the buyers agent leave the buyer feeling that their agent sold them out and can often lead to their filing complaints with the state real estate commission.

The most effective way to sell anything is pricing. Don't offer a bonus, lower the price of your home. or offer the bonus as closing cost assistance to the buyer or offer to put in a new appliance package with an acceptable offer from the buyer.

Speak with your agent and see what they suggest.
0 votes
Suzanne MacD…, Agent, Morristown, NJ
Wed Sep 5, 2012
I agree with your agent. No matter how motivated the agents are, it is the buyer that needs to be motivated. If you want to guarantee a quick sale, price your home accordingly. That will attract both buyers AND their agents. I have seen bonuses offered, but have never been able to take advantage of one because the bottom line is, I have a duty to my buyers to put their interests above my own and the way to put buyers interests first is to price the home correctly.
0 votes
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