[sokoloff]

> maximizing the value of their client's home by reducing the commission the seller pays.

Selling a house quickly (convincing the seller to take a qualified and likely-to-close offer) still dominates as a strategy over eeking out a few extra points of contract price. As an agent, taking 1.25% or 1.5% of a $950K sale quickly is way better than holding out for a $1M offer.

The difference in commission at 1.5% on a $50K delta in sales price is $750. Freeing up your time to work on the next listing is more valuable.

[efitz]

I always thought the right strategy would be to have a sellers agent contract that was tiered, eg agent gets 1-2% of selling price up to average comps, and then 20% of excess selling price over that. Maybe a bonus or penalty for timing, to prevent waiting forever for a good offer.

[notaustinpowers]

The main issue with that possibility is many brokerages (at least ones in my area) do not allow a Seller's Agent to reduce their commission without prior Broker authorization. Regardless of what the Seller themselves wants. So while that deal may be advantageous for the Seller (sell quickly) and the Agent (get the deal over with and move on to the next), the Broker is the one getting paid a lower sum and will not allow that contract to be ratified.

[sokoloff]

Nothing in my comment is about changing the percentage of the commission. (The 1.25% or 1.5% is simply the listing agent's personal split of a 5% or 6% total commission [whichever is customary in the local area]).

[notaustinpowers]

Sorry, I didn't explain enough. The total commission remains 6%, but if the Seller's Agent split is only 1.25%, the Seller Agent's Broker (most likely) will deny that as the Broker would receive a reduced cut of the commission.

The Seller and the Seller's Agent may be cool with the reduction, but the Broker would ultimately have the final say since it's, legally, their contract.

[sokoloff]

Ah. I’ve never seen a percentage-based commission divided unequally into the four parts: agent and brokerage crossed with listing and buying.

I have seen 6% (1.5% x 4) and 5% (1.25% x 4).

[notaustinpowers]

Yeah, it's usually unequal in the area I used to work in. The Agent's have their own agreements with their Brokers that are independent of any sale/purchase they work on. I've seen everything from 50/50 all the way to 90/10 (10% to Broker).