You Get What You Pay For

As my first month at Bowes and Cocks Brokerage is coming to an end I must say that I have thoroughly enjoyed each and everyday. Every morning I would wake up knowing that I would learn something new and interesting. Everyone at the office was welcoming, willing to help out and seem like genuine people, perhaps that is why the Peterborough office is number one within the company and had a sales volume growth of 27% last year, a large percentage that no other company in the Peterborough area can claim as you can see in the sales volume graph of 2008 located above. Each week when I attend the meetings and get to know my fellow sales representatives and learn from their experiences and knowledge, I am thankful that I have found a great brokerage to work for. One topic of discussion lately has been that other sales representatives in the area have dropped their commission rate to 3.75%.
A commission rate drop to 3.75% means that the seller would be saving $1200 per $100,000 of the sale price which sounds great, but do not be fooled by this simple equation there is more to it. A fellow agent in the office made a good point he said, “If the listing agent is so willing to give away his/her money, what makes you think he/she isn’t so willing to give away your money”. Although you may believe you’re saving a few thousand on commission, the listing agent may lack negotiation skills therefore loose you much more money in the end with a low sale price than the few thousand on commission you saved, this is something that has happened in the Peterborough area recently.

Another great point brought up by a very successful woman in the office is that it doesn’t make sense that the listing agent who is working for you, knows the most about your home, your property, advertises your home and is hosting open houses would make less on the sale of your home, than if he/she were to assist a buyer in buying a home down the street where he/she would make the average 5% split giving him/her 2.5% commission whereas with the sale of your home only earning 1.875% after splitting 3.75%. It just doesn’t make sense.

Ideally one should pay a sales representative from a reputable brokerage, someone who has a great track record and can help you with one stop shopping when searching for professionals such as home inspectors, lawyers, and mortgage specialists. Isn’t the age old saying you get what you pay for? What makes you think this is any different? If the amount of money a sales representative is going to earn on your home is less than average, wouldn’t it seem logical that their advertising costs would be less than average and your home may end up being on the market for a longer period of time without much exposure inevitably becoming stale and taking a longer period of time to sell.

The point I’m trying to drive home is do your homework, research the person and the company you are hiring to assist you in buying or selling you a home. Look in your neighbourhood, see for yourself who’s signs are up and who’s have sold, ask your friends and family who they would recommend, do not rely simply on a commission rate, because you don’t want this transaction to be the one that you are saying, I got what I paid for.
-Ashley Ross, sales representative