In Episode 62 of the Toe-2-Toe Podcast, hosts Jenn Murtland and Monica Weakley, along with guest host TJ Gausman, duke it out over this: should the buyers pay their own agent’s commission? Until now, TJ has split his tiebreakers between Monica and Jenn, so hear who TJ sides with on this one.
Episode Highlights:
- TJ says there is no way that the buyer should pay their agent’s commission.
- First-time homebuyers have a hard time in the difficult market and would have added emotional stress if they had to pay.
- Monica thinks that the industry would face a massive amount of unrepresented buyers if it was left up to them.
- It would be bad for the real estate industry as a whole if buyers choose to be unrepresented.
- Jenn thinks that buyers should have to pay for their representation.
- Buyers don’t see the value of the agent until the moment that the agent delivers.
- Both TJ and Monica believe that adding a buyer fee would significantly change the way that buyers would choose to be represented.
- Jenn believes that if buyers cannot afford to pay the fee then they cannot afford the house.
- The 6% commission is kept by the agent as a listing fee whether the buyer is represented or not.
- TJ explains to clients that selling agents take commissions and when they do decide to sell, they will pay that commission.
- According to Bravo TV, there are no buyers’ agents in England at all.
- Ultimately, the buyers are paying for the agent, it’s just packaged within the price of the house.
- TJ believes that if appraisers didn’t build in the commission into the value of the home, they would sell at a lower price.
- According to Jenn, buyers wouldn’t vanish because they are paying a fee anyway.
- It sounds like there will be no agreed-upon precedent from this bout, pinning Jenn against TJ and Monica.
- TJ is team Monica on this one, claiming that the system is not broke enough to add an extra variable.
- Jenn respectfully disagrees, saying that because it is your purchase, you should pay for representation.
- Buyers may or may not choose to go unrepresented, but that’s where these sides differ.
3 Key Points:
- Agents are not able to show their value to the buyers until they deliver, so it’s hard to ask for a fee at the beginning.
- Monica and TJ fear that most buyers would go unrepresented, while Jenn looks to the small number of sellers that go unrepresented as a sign that buyers would follow the same line.
- Appraisers build the commissions into the price of the house but explaining that mental Olympics might scare buyers off from their agents.
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