New Brokerage in Town...

[John Jabson]

A new brokerage is offering to pay for my real estate license and wants me to sell part-time outside of my teaching schedule (8-3:15). The risk is low however the town is small (county population under 45,000 and town population less than 12,000) and I don't want to gain a reputation for signing on to a new brokerage failure and look like a complete idiot. I have to be sure this isn't a huge mistake although there's no way to know until I"m into it. I will say that the 3-4 main companies in this area have been here for 30 plus years and are solidified, or seem to be.

This new company is claiming that they will be able to penetrate the market with lower commission rates. They are offering 4.5 percent commission to sell a homeowner's property while every brokerage in town does 6 percent. There are not alot of high end homes in this county. Most first time home buyers go 70-110K. I'm not sure if people will go with a new brokerage to save 1.5 percent. Any thoughts?

[Wayne Brooks]

At a 4.5% commission, the selling side will likely still be getting 3%. That means your side, the seller side, gets 1.5% which you split with the brokerage at some set rate. That means YOU are working for 1/2 price. And, the Broker sets the commission, not the agent, as the listing belongs to the Broker. The agreement is legally between the owner and the Broker