Perhaps consumers are aware of this fact: REALTORS WORK HARDER THEN EVER NOW JUST TO MAKE THE SAME OR CLOSE TO THE SAME AMOUNT OF MONEY AS THEY HAVE IN THE PAST.
With home prices down 30-50% in many areas and homes sales overall down it is very difficult for a Realtor to make the income they have made in the past few years. Now some consumers may say something like, "Good! Those Realtors made too much money in the past."
However, at any point someone is using a service such as a Realtor to buy a house there is VALUE or there would not be a service for the NEED. So even in the good times Realtors were compensated based on the VALUE their service was worth.
With the new economy we are in many REALTORS are UNDERPAID and here is why:
1. The cost the market a home has not went down. In fact its gone up since to be a TOP Marketing agent you have to have the latest tools and most of them cost money.
2. Homes are almost HALF PRICE in areas like mine (North Metro of Minneapolis/St. Paul), but the commission are the same or less on the lower price home.
3. Because of bank owned and short sale homes it seems that it takes 3-4 offers per buyer to get one to stick. Some of the homes are priced well and multiple offers leave you being out bid. Many buyers want to LOW BALL their first offer to feel things out. Most of the time those are rejected. Then finally everything goes about right on the third or forth try.
4. Getting an inspection done on a BANK OWNED home takes extra diligence. In Minnesota all the homes are winterized. So you have to cordinate them being dewinterized. Often you find out its not done, or when it is done you find some leaky pipes. Then you have to negotiate the bank to fix it. All this because a lot of extra calls, emails, faxes, and driving around to meet people.
5. Overall if you understand the cost to be a Realtor, its not like we get to keep all the commissions. Some agents split it with their brokers, others pay office rent space, plus there are the marketing costs, and other business related costs. NONE OF WHICH SEEM TO BE GOING DOWN.
6. Finally you get close to closing and some other unforeseen issue or challenge comes up and then you have to work all day to get the closing to happen.
I believe a consumer who was able to step back and reflect on what we do during a transaction, would come to the conclusion that we are underpaid.
Certainly my associates on Active Rain can add to this list and you are welcomed to do so in the comment section. I got an offer verbally accepted on a BANK OWNED listing while posting this. $78,000...same home was $159,900 about 3 years ago. This was the buyers 4th offer. One was a derailed short sale. Two others multiple offers that he was out bid. I WORKED HARD FOR THAT MONEY! And I will get in in 6 weeks or so... I am happy and thankful!!!
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Chuck Carstensen is a Realtor with The Discovery Team at RE/MAX; helping buyers, sellers, and investors of residential real estate. He is a Dynamic Life Coach; The Discovery Coach- "Helping you discover your talents, desires and purpose." Carstensen is a speaker and co-author in the best selling book series Wake Up...Live the Life You Love: Your Wake Up Moments (NOW available go to http://tinyurl.com/wakeupmoments).
