“How much do you charge?”
I received another call yesterday in which the person considering selling his home had just this one question for me. Fees are important, of course, but fees are only one part of the equation. I’ll argue that fees aren’t even the most important variable. I often find myself eloquently explaining this critical nuance — to a dial tone – before I have even had the opportunity to answer the question.
My favorite purse is a knock-off. I paid about one-tenth of what I would have for the “real McCoy,” but it is quality, the company came highly recommended, and it has held up well. In short, I got a deal. Not all of my brief forays into the land of frugality have ended on such a happy note, however. The sweater I purchased at a deep-discount store, one which looked remarkably like the expensive sweater at the designer store, returned to its native state – a big mass of sheared wool – after the first laundering. In the case of the short-lived garment of sheep origin, I didn’t save a dime. It actually cost me.
Fees are negotiable. I can’t discuss ours here because of anti-trust laws, but suffice it to say we are competitive. Query ten agents and you may get as many answers to the “How much?” question. Ask ten agents what your home is worth and the results will be the same. But take that extra step of considering what you get for your money, and the resulting scatter chart may surprise you.
And the reality is that there is not necessarily a direct corollary between fees and services or fees and results, but a seller can’t draw these distinctions from a thirty-second sound bite. As a seller, I presume that the real goal is not to minimize fees but to maximize the proceeds check. So the silly trivialities of preparing of the home for sale and marketing to attract the largest number of eyes are not so trivial. An escrow is only as good as its ability to close, and the way in which the contract will be negotiated and processed is not irrelevant, nor is the agent’s reputation among his peers or his breadth of experience. In short, the ways in which an agent conducts his business are every bit as important to a seller as the fees he charges for his services.
In competitive situations, we always encourage the customer to evaluate the complete package and select the agent they consider best for the assignment. At that point, consider commissions. If it’s close or even a perceived virtual toss-up, then let the fees dictate. It’s Value Engineering 101, and it seems so simple, yet it is a concept often lost.
Think of it as an Olympics competition. One agent may excel at the balance beam, another at the vault and still another at the floor exercise. Sometimes they will be the same person, and other times they will not. What you are ultimately looking for is best all-around. The agent you select to represent you will have an, often tremendous, influence on the outcome and the stakes are high. It is not in your best interest to treat the hiring process like a Gallup poll. Have you seen their margins of error?