In Episode 36 of the Toe-2-Toe Podcast, hosts Jenn Murtland and Monica Weakley duke it out over whether we should move to a new model for listings. Hear why Jenn thinks a sliding scale model for commission can be successful and why Monica thinks exclusive agency creates an emphasis on partnership. This episode will give you different models to think about and ways to evaluate how you are partnering with your sellers.
Episode Highlights:
- Should we move to net listings?
- Jenn provides a quick overview of the differences between a net listing and an open listing.
- Jenn's understanding is that in the net listing model, if a home sells for anything above the set price, that money goes to the agent and the seller pays normal closing costs.
- Commercial agents use the open listing model more frequently. This may place more emphasis on relationships.
- Jenn shares her thoughts on how what happens in commercial real estate would translate into the residential real estate world.
- Jenn notes that they use open listings in Peru.
- Jenn likes the idea of a scale model. For instance, if an agent sells the home within a particular time frame, then they would get a certain commission.
- Monica thinks this new model would put a stop to agents competing with each other by promising sellers unreasonable prices.
- The scale model could also create an incentive for honesty from agents.
- Monica says that there’s not a perfect model.
- Jenn talks about agents who are using the sliding scale model. Monica notes that sometimes this leads to terrible listing pictures taken on phones.
- Monica's standard around price scaling is that she will not take less than $3k commission. She charges 7% if you're an out-of-town seller.
- Jenn doesn't think contracts are worth what they're written on, but that it’s good to have something in place.
- Monica likes the idea of the net listing but doesn’t know if we’re ready for that model.
- Monica likes giving the agent the ability to tier their pricing.
- Monica believes that exclusive agency probably creates the nicest partnership. Jenn disagrees.
- Jenn is in favor of experimenting with open listings.
3 Key Points:
- The open listing model is used more frequently in commercial real estate circles where relationships are often emphasized more.
- The sliding scale model also offers an alternative to the exclusive agency model and gives realtors some flexibility.
- Experiment with different listing models and see what works best for your business.
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