From Newsday:
FREE HAIRCUTS . . . if she sells their house
Bring the buyer. Get a year of free hair salon services.
That’s the offer real estate agent Zandra Lawrence got in September from a Miller Place seller if her house-hunting client agreed to come back and purchase the home, with free high-end furniture included.
“I just thought it was very, very surprising, but it got my attention, even though my buyers were going into contract on another house,” said Lawrence, who works out of Coach Realtors’ Miller Place office. “I was obligated to tell the buyers what the seller had offered them.”
…
These perks to agents have been a growing local phenomenon as homeowners and their agents cope with a glut of homes all competing for limited numbers of buyers. A vacation, cash bonus, higher commission split and other incentives are there for agents who can match house with house hunter. This marketing to agents may not lead to a closing, but the point of a buyers’ agent bonus is to boost foot traffic on the properties, a way to increase chances of a deal.
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But because no one’s biting, Stark has added a feature to his listing – a $5,000 bonus for the buyer’s agent. He realizes that buyers aren’t as plentiful nowadays and agents are like the gatekeepers to them.“Agents are pulled in a lot of directions,” he said. “By giving agents an incentive, they take note and maybe they would show your house.
“You can’t sell the house unless people walk through the doors. Yes, you’re paying for it to drive people in and then the house has to basically speak for itself.”
Like a lot of offers to buyers’ agents, Stark’s five grand has an expiration date. The agent gets it only if the buyer signs by the end of this month. To him, the deadline gives urgency to his listing.
“Once it’s there forever, then it’s just like any other house,” said the homeowner, who owns a mortgage brokerage. “If you don’t hit the emotions, you’re not going to sell anything.”
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But one real estate finance professor said such bonuses could lead to a conflict between what’s best for the agents and what’s best for the buyers.“They may not be shown all the houses that are best for them,” said Robert Campbell, who teaches at Hofstra University. “They may be shown the houses that have the bonus. They may be shown those houses first.”
Would’nt it be ironic if real estate agents
ended up making even more $$$ as a result
of such “bribes” to bring in qualified
buyers?
Nothing new; agents are ONLY working for their own interest. They are only working for your interest when asleep.
As an office manager at the leadin real estate company in Connecticut, I fully advise our sellers against offering any incentive to buyer agents outside of the contracted commission. I would rather see the money utilized to buy down a mortgage for the potential buyer or offer 12 months f common charges for the BUYER. Of course, if the home is priced effectively no incentive hould be necessary.
all these silly gimmicks…just lower the price!
Marc,
I agree.
What concerns me most is the potential for these types of incentives to be hidden from the buyer. In NJ, most buyers are familiar with the MLS client printouts. However, the incentives are typically included in an agent remarks field, a field that isn’t printed on the client reports.
For anyone who thinks this is ok: If it doesn’t pose an issue, why not disclose it on the client MLS sheets?
#5 – grim
agent remarks: its a reason we went directly to the list agent when making an offer. We felt we didn’t have leverge. We made an offer, they countered, we didn’t budge, & the deal was closed.
“new roof by seller” was listed under additional comments for us & all the public to see. but we could only imagine how little negotiating power we would have had with a buyers agent due to those public comments.
ps.
Clot…
Am I misleading multiple furnace dealers that drive out to my house to give me a listing of models along with their estimate of labor? Those furnace dealers oughta start sending emails.
Any and all sales people who work for a commission work for THEMSELVES. Otherwise it would be salaried/hourly position.