Tying buyer agent commission to tougher pricing

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Tying buyer agent commission to tougher pricing

James McGovern
Flipper/Rehabber · Bloomfield CT · Member since 2020 · 1k+ posts · 408 votes

I will be listing a property and want to create a tiered buyer commission -

- 1% offer at list or below 

- 1.5% offer between 190 and 220

- 2% offer above 220

an additional 0.5% for offers that require minimal or no addressing of inspection issues or other requests that cost seller money

thoughts?

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Steve K.
Realtor · Boulder, CO · Member since 2016 · 3k+ posts · 5k+ votes
1y

Buyer's agents can no longer see what commission rate sellers are offering after the NAR lawsuit settlement last year. I would write $10k flat fee into the offer for a property at this price point, as that is the lowest amount that it makes sense for me to do a transaction with all of my expenses and time accounted for. If the listing agent told me your recommended commission structure, or you countered our offer with that, I would tell you to get serious. 1% at this price point is like $2 an hour after expenses. You are not a serious seller. My buyer would have to pay me out of their own pocket, and the price would need to be discounted accordingly.

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  • JD MartinBusiness Member
    Moderator
    Rock Star Extraordinaire · Northeast, TN · Member since 2015 · 10k+ posts · 16k+ votes
    1y

    I think your proposal is too complicated for a cheap house. I'd stick to some flat sales bonus for closed offers over $X that close within X days (because if it closes within X days that eliminates a lot of those additional issues). I am not sure you can advertise this information with the RE settlement, so I have no idea how you're going to get the word out. 

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  • Joe Norman
    Property Manager · Baltimore, MD · Member since 2014 · 1k+ posts · 1k+ votes
    1y

    Keep in mind that regardless of what you offer co-op commission, the buyer can always ask for something different as a part of their offer. Co-op commission isn't fixed and is negotiable. Offering this "tiered" structure also may incentivize the agent to not act in the buyer's best interest (which isn't necessarily your problem, but your listing agent may have qualms about putting something like this out there).

    I would just offer a competitive co-op commission (your Realtor can advise you on what that looks like in your area) and then negotiate fair terms with whoever submits offers.

    3Reply
    • James McGovern
      OP
      Flipper/Rehabber · Bloomfield CT · Member since 2020 · 1k+ posts · 408 votes
      1y

      @Joe Norman all offers that don't meet criteria are filed in the trash. I have let several buyers agents know this upfront 

      0Reply
  • Steve K.
    Realtor · Boulder, CO · Member since 2016 · 3k+ posts · 5k+ votes
    1y

    Buyer's agents can no longer see what commission rate sellers are offering after the NAR lawsuit settlement last year. I would write $10k flat fee into the offer for a property at this price point, as that is the lowest amount that it makes sense for me to do a transaction with all of my expenses and time accounted for. If the listing agent told me your recommended commission structure, or you countered our offer with that, I would tell you to get serious. 1% at this price point is like $2 an hour after expenses. You are not a serious seller. My buyer would have to pay me out of their own pocket, and the price would need to be discounted accordingly.

    7Reply
    • Brandon VukelichBusiness Member
      Real Estate Broker · Tacoma, WA: 🏢 27 LTRs 🏡 3 STRs · Member since 2018 · 546 posts · 456 votes
      1y
      Quote from @Steve K.:

      Buyer's agents can no longer see what commission rate sellers are offering after the NAR lawsuit settlement last year. I would write $10k flat fee into the offer for a property at this price point, as that is the lowest amount that it makes sense for me to do a transaction with all of my expenses and time accounted for. If the listing agent told me your recommended commission structure, or you countered our offer with that, I would tell you to get serious. 1% at this price point is like $2 an hour after expenses. You are not a serious seller. My buyer would have to pay me out of their own pocket, and the price would need to be discounted accordingly.

      Not totally accurate @Steve K. about a buyer's agent can no longer see commission. We (in the NWMLS) still publish buyer broker commissions being offered. It is not visible on 3rd party sites but we (agents) see it on our end. However, we are seeing more "request in offer" being stated than a percentage or fixed dollar amount. 

      Agree with your comments about the proposed commission "stair stepping" thing. Especially for a $200k-ish property. After splits, taxes and fees most agents would hardly take home much even if 3% was offered. At 1-2%, I'd rather refer out my potential buyer and let another agent do all the work and give me some tiny referral for not having to manage the transaction.

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    • Steve K.
      Realtor · Boulder, CO · Member since 2016 · 3k+ posts · 5k+ votes
      1y
      Quote from @Brandon Vukelich:
      Quote from @Steve K.:

      Buyer's agents can no longer see what commission rate sellers are offering after the NAR lawsuit settlement last year. I would write $10k flat fee into the offer for a property at this price point, as that is the lowest amount that it makes sense for me to do a transaction with all of my expenses and time accounted for. If the listing agent told me your recommended commission structure, or you countered our offer with that, I would tell you to get serious. 1% at this price point is like $2 an hour after expenses. You are not a serious seller. My buyer would have to pay me out of their own pocket, and the price would need to be discounted accordingly.

      Not totally accurate @Steve K. about a buyer's agent can no longer see commission. We (in the NWMLS) still publish buyer broker commissions being offered. It is not visible on 3rd party sites but we (agents) see it on our end. However, we are seeing more "request in offer" being stated than a percentage or fixed dollar amount. 

      Agree with your comments about the proposed commission "stair stepping" thing. Especially for a $200k-ish property. After splits, taxes and fees most broker would hardly take home much even if 3% was offered. At 1-2%, I'd rather refer out my potential buyer and let them do all the work and give me some tiny referral for not having to manage the transaction.


      Gotcha, thanks for the correction. Is your MLS not affiliated with NAR then I'm guessing? At first last year after the settlement, listing and buyer's agents here were communicating to each other via text prior to writing an offer, or advertising the buy-side commish on our own websites, but now most are just writing it into the offer because that is easiest. Funny how the news reported this as a major industry shakeup when it is actually just a very minor procedural change.

      2Reply
    • Brandon VukelichBusiness Member
      Real Estate Broker · Tacoma, WA: 🏢 27 LTRs 🏡 3 STRs · Member since 2018 · 546 posts · 456 votes
      1y
      Quote from @Steve K.:
      Quote from @Brandon Vukelich:
      Quote from @Steve K.:

      Buyer's agents can no longer see what commission rate sellers are offering after the NAR lawsuit settlement last year. I would write $10k flat fee into the offer for a property at this price point, as that is the lowest amount that it makes sense for me to do a transaction with all of my expenses and time accounted for. If the listing agent told me your recommended commission structure, or you countered our offer with that, I would tell you to get serious. 1% at this price point is like $2 an hour after expenses. You are not a serious seller. My buyer would have to pay me out of their own pocket, and the price would need to be discounted accordingly.

      Not totally accurate @Steve K. about a buyer's agent can no longer see commission. We (in the NWMLS) still publish buyer broker commissions being offered. It is not visible on 3rd party sites but we (agents) see it on our end. However, we are seeing more "request in offer" being stated than a percentage or fixed dollar amount. 

      Agree with your comments about the proposed commission "stair stepping" thing. Especially for a $200k-ish property. After splits, taxes and fees most broker would hardly take home much even if 3% was offered. At 1-2%, I'd rather refer out my potential buyer and let them do all the work and give me some tiny referral for not having to manage the transaction.


      Gotcha, thanks for the correction. Is your MLS not affiliated with NAR then I'm guessing? At first last year after the settlement, listing and buyer's agents here were communicating to each other via text prior to writing an offer, or advertising the buy-side commish on our own websites, but now most are just writing it into the offer because that is easiest. Funny how the news reported this as a major industry shakeup when it is actually just a very minor procedural change.


      Correct, NWMLS is not NAR owned. Agreed, a lot of fear, confusion, etc. after the NAR lawsuit circus. We are pretty much status quo for the most part out here.

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    • Jay HinrichsBusiness Member
      Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
      1y
      Quote from @Brandon Vukelich:
      Quote from @Steve K.:

      Buyer's agents can no longer see what commission rate sellers are offering after the NAR lawsuit settlement last year. I would write $10k flat fee into the offer for a property at this price point, as that is the lowest amount that it makes sense for me to do a transaction with all of my expenses and time accounted for. If the listing agent told me your recommended commission structure, or you countered our offer with that, I would tell you to get serious. 1% at this price point is like $2 an hour after expenses. You are not a serious seller. My buyer would have to pay me out of their own pocket, and the price would need to be discounted accordingly.

      Not totally accurate @Steve K. about a buyer's agent can no longer see commission. We (in the NWMLS) still publish buyer broker commissions being offered. It is not visible on 3rd party sites but we (agents) see it on our end. However, we are seeing more "request in offer" being stated than a percentage or fixed dollar amount. 

      Agree with your comments about the proposed commission "stair stepping" thing. Especially for a $200k-ish property. After splits, taxes and fees most agents would hardly take home much even if 3% was offered. At 1-2%, I'd rather refer out my potential buyer and let another agent do all the work and give me some tiny referral for not having to manage the transaction.


      down here in Portland the RMLS has taken away the field for BAC.  agents have to put their commission requests in the offer.. but in practice most will call and ask if we are offering a BAC. And our standard reply is yes and its negotiable.

      right now we try to negotiate a flat fee of 10k.. I find most agents can rationalize that and of course buyers will think thats a great fee for their agent

      really depends on market and how sales are going in Hot selles market you negotiate lower fee in Hot buyers market it goes the other way.

      as for the OP on a 200k house 1% is rediculous for most agents but I am sure there will some that are good with it.. Not many though.. And for sure you dont lead with that .. The OP seems to think buyers will be led by their nose ring by the agent on what to offer and what to pay.. Agents dont have this kind of influence on buyers generally very rare and agent can bully a buyer into taking seller criteria.. buyer will dictate what they are good with not hte agent.
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  • Bruce Lynn
    Real Estate Broker · Coppell, TX · Member since 2011 · 5k+ posts · 4k+ votes
    1y

    Don't overthink this.  Don't do things that discourage sales. Don't be a problem seller.

    3Reply
    • James McGovern
      OP
      Flipper/Rehabber · Bloomfield CT · Member since 2020 · 1k+ posts · 408 votes
      1y

      @Bruce Lynn no such thing as a trouble seller. The market has low inventory in Connecticut and buyers agents can fail their buyers by thinking I am a trouble 

      0Reply
  • Mark Towey
    Real Estate Agent · Wichita, KS · Member since 2023 · 34 posts · 11 votes
    1y
    Quote from @James McGovern:

    I will be listing a property and want to create a tiered buyer commission -

    - 1% offer at list or below 

    - 1.5% offer between 190 and 220

    - 2% offer above 220

    an additional 0.5% for offers that require minimal or no addressing of inspection issues or other requests that cost seller money

    thoughts?


     I'm curious to know if you still decided to do the tiered buyer agent commission after hearing these responses?

    0Reply
    • James McGovern
      OP
      Flipper/Rehabber · Bloomfield CT · Member since 2020 · 1k+ posts · 408 votes
      1y

      @Mark Towey no change in plans

      0Reply
    • Steve K.
      Realtor · Boulder, CO · Member since 2016 · 3k+ posts · 5k+ votes
      1y
      Quote from @James McGovern:

      @Mark Towey no change in plans

      You’re choosing to work with low quality people. Have fun but just don’t come back on here to complain later when your deal goes sideways.  
      3Reply
    • James McGovern
      OP
      Flipper/Rehabber · Bloomfield CT · Member since 2020 · 1k+ posts · 408 votes
      1y

      @Steve K. What is your suggestion for identifying better buyers agents?

      0Reply
    • Steve K.
      Realtor · Boulder, CO · Member since 2016 · 3k+ posts · 5k+ votes
      1y
      Quote from @James McGovern:

      @Steve K. What is your suggestion for identifying better buyers agents?

      I don’t know what you mean by “identifying better buyers agents”. If you want to sell the property just don’t get in your own way. Offer fair compensation which in this case a $10k flat fee makes sense IMO. By offering this tiered structure idea, it sends the message that you are going to be a nightmare to work with and aren’t serious about selling. 1% means the buyers agent is working for less than their overhead expenses cost them, and the top tier is still less than minimum wage. Don’t be difficult to work with or try to mess with people’s livelihoods. You can’t control which buyers agent a buyer chooses to represent them, or what they have agreed to as far as compensation in their buyers agency agreement. If what you are offering is out in left field and what they have agreed upon already is fair, then you’re just creating problems and messing with your own sale. If you’re serious about selling, offer fair compensation. 
      0Reply
    • James McGovern
      OP
      Flipper/Rehabber · Bloomfield CT · Member since 2020 · 1k+ posts · 408 votes
      1y

      @Steve K. How do you define what is fair? Why should I pay more if I am not getting more?

      0Reply
  • Christian Maluo
    Real Estate Broker · Portland, OR · Member since 2025 · 81 posts · 43 votes
    1y

    Realtor here (Oregon). We have already signed paperwork with our buyers as to what our commission will be. We place that amount on our offer forms that are presented to you. Any reduction from what was already negotiated with the buyer could become a buyer expense. Be reasonable.

    1Reply
    • James McGovern
      OP
      Flipper/Rehabber · Bloomfield CT · Member since 2020 · 1k+ posts · 408 votes
      1y

      @Christian Maluo yes I want any ask to be a buyer expense

      0Reply
    • James McGovern
      OP
      Flipper/Rehabber · Bloomfield CT · Member since 2020 · 1k+ posts · 408 votes
      1y

      @Christian Maluo why should a seller pay a penalty for something they did not participate in negotiating?

      0Reply
  • Malachi Armas
    Member since 2025 · 1 post · 1 vote
    1y

    This subverts the purpose of a buyers agent: to act in the best interest of their client (the buyer) and not the seller.

    1Reply
    • James McGovern
      OP
      Flipper/Rehabber · Bloomfield CT · Member since 2020 · 1k+ posts · 408 votes
      1y

      @Malachi Armas need for buyer's agent to bring better offers. Sometimes subversion is a necessary evil

      0Reply
  • Henry Lazerow
    Real Estate Agent · Chicago, IL · Member since 2017 · 2k+ posts · 2k+ votes
    1y

    When you sign the list docs you agree with seller in advance how much sellers agent and buyers agent collect. Regardless, I don't know any buyers agent who will try to squeeze their client for a higher offer due to higher co-op that would be extreamly unethical. Typically atleast in IL 2.5% is the co-op and on rare occasions seller offers less so the buyer just offers a little lower and pays the remaining portion themselves at closing, it ends up netting out the same.

    0Reply
    • James McGovern
      OP
      Flipper/Rehabber · Bloomfield CT · Member since 2020 · 1k+ posts · 408 votes
      1y

      @Henry Lazerow nope. Listing agreement should only focus on commissions for listing. Agreements that have both sides are red flags and suggest they are living in a pre NAR world

      0Reply
  • James Hamling
    Real Estate Broker · Minneapolis, MN · Member since 2011 · 5k+ posts · 6k+ votes
    1y

    @James McGovern it's really clear that you don't really know much about Real Estate industry, how it all works, the various in's and out's of things. 

    And instead of just asking "Hey, how do I get buyer agent's to bring the highest prices and best terms for sellers?" your jazzing up some rather messed up incentive to get a buyer agent to F there client for a incentive of more $ for themself. 

    It simply does not work that way, and all your doing is telegraphing how you yourself work and would act. As in you'll happily F-someone if it makes you a few more bucks. 

    Here is the reality and details of things: 

    Before a buyer's agent and there client's present any offer, or before even see the place, the buyers and buyer(s) agent's already set what the compensation of that agent will be. It's already done and set in contract. 

    So it won't work as you think. Buyer agent compensation won't change, and buyers WILL see the FULL math of it all right from get-go. 

    Your hoping it can be some shady thing a buyers agent keeps on the DL. NOPE. 

    Second, unless your offering me MINIMUM $7 million, I'm gonna tell you to get f'd. I'm NOT gonna risk my license, my reputation, my career for some shady BS for any seller wanting me to violate my duty to my clients so you can squeeze a few extra drops of blood from a rock. 

    I get that in your day job you may do this, and readily get away with it, Real Estate does NOT work this way. 

    Next, what about appraisal? 

    So let's say you do get some green moron of an agent who get's there buyers to offer stupid $. The appraiser and financing does not give a fck! There gonna cover there own butt's and do things legit, so how are you gonna riddle that when appraisal come sin UNDER the PA? 

    Or, how about if/when the buyer agent has a Managing Broker like me who reviews the PA and then calls the agent asking just what in the flock kind of BS is this? And beats the dumb out of our agent. And yes, I'd cancel that PA in a heart-beat. 0% chance I'd let the BS cross my desk, hell-to-the-no. 

    Your scheme presses a buyers brokerage to take on millions upon millions in liability exposure. Not a snowballs chance in hell I'd tempt those fates, no brokerage will.

    The most likely outcome will be every agent reading between the lines that your clueless in real estate, and acting like a greedy dink so we assume what else shady BS are you willing to pull over, like hiding various condition aspects. 

    So next were gonna get savage on ya. 

    Were gonna enter it with strategy on how to school-ya on why to not mess with agents in such a way. 

    We will frame-work an offer that on surface looks great but has all the teeth in conditions. Were gonna get the most hardcore inspection and then send you the 30+ pages of issues and inform now it's all known condition and you MUST legally disclose it to all potential buyers going forward. Were gonna beat you down every-step-of-the-way. 

    With concession after concession after discount after concession. 

    In summary, odd's are your just gonna invite a good ole fashion azz-whoopin. 

    -OR- 

    You could remove all that BS. 

    Under list on price a touch. Offer a straight up 2.5%. Get a pre-inspection that your broadcast with it showing all green-lights, market the heck out of it and press to get multiples. 

    And in multiples, with such confidence of condition telegraphed, that's how you get people removing contingencies, and price competing emotionally because they want to "win" the deal. 

    Shady agent BS is NOT the way. 

    Buyer's competing on emotion, feeling safe and secure to remove contingencies, THAT is how it's done. 

    1Reply
    • James McGovern
      OP
      Flipper/Rehabber · Bloomfield CT · Member since 2020 · 1k+ posts · 408 votes
      1y

      @James Hamling I am not screwing anyone. I do want the agent to do all the negative activities including convincing buyers they don't need an inspection. Also skipping any appraisal as I will provide seller financing 

      0Reply
    • James Hamling
      Real Estate Broker · Minneapolis, MN · Member since 2011 · 5k+ posts · 6k+ votes
      1y
      Quote from @James McGovern:

      @James Hamling I am not screwing anyone. I do want the agent to do all the negative activities including convincing buyers they don't need an inspection. Also skipping any appraisal as I will provide seller financing 

      And the rub is you don't know/understand the laws governing this industry and agent/client relationships. 

      It's VERY illegal and unethical what your hoping/seeking a buyer agent to do. The buyer agent, there broker and the brokerage would get in ton's of trouble if they were ever found of doing such. It's such a big deal that even the accusation of such is very bad. 

      That is why the optics, how it makes you look by trying to ask or seek for such, is so bad. 

      A big piece of what any decent buyers agent does is to read between the lines. Your trying to know the unknown, ferret out the hidden, if there is anything hidden. A good buyers agent is a paranoid person. 

      So doing something like that is a MASSIVE red-flag. Which of course the "paranoid" buyers agent will assume all the more to it. 

      Buyers agents are legally and license bound to work for the best interest of there buyers, full-stop. 

      And fact that you want to do seller financing and not have any appraisal only amp's UP, not down, that liability and duty put on the shoulders of buyers agent. 

      It's very VERY foolish when selling on terms to not allow buyers to do an appraisal. Whenever I sell on terms I always allow it AND encourage buyers to do ALL there D.D. including there own appraisal. I give them added disclosures to sign to the fact. 

      You're risking a lot with all the scheming. 

      Scheming = liability. 

      2Reply
    • James McGovern
      OP
      Flipper/Rehabber · Bloomfield CT · Member since 2020 · 1k+ posts · 408 votes
      1y

      @James Hamling buyers agent is not forced to make an offer. I put the choice of ethically behaving in their court. Full stop

      0Reply
    • Jay HinrichsBusiness Member
      Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
      1y
      Quote from @James McGovern:

      @James Hamling buyers agent is not forced to make an offer. I put the choice of ethically behaving in their court. Full stop


      U cant keep a buyer or buyers agent from doing an appraisal.. I guess you could restrict access to the house YES.. but they could always do a desk top driveby.. anyone can do that Jim and I can do one today on your property and there is nothing U can do about it.. just think about how zillow works and comes up with values.. zillow needs no permission. 
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    • James Hamling
      Real Estate Broker · Minneapolis, MN · Member since 2011 · 5k+ posts · 6k+ votes
      1y
      Quote from @James McGovern:

      @James Hamling buyers agent is not forced to make an offer. I put the choice of ethically behaving in their court. Full stop


      Let's see if I can put this into context that drills the point through. 

      If you go and offer a reward to wack someone..... 

      No, your not off'ing em, you haven't done any of that, and yes the person "choose" to go wack-em, right. 

      And 1,000% your butt is going straight to prison for it, along with the idiot who went and took your reward offer. 

      Yes, you are liable when you create some scheme to get people to violate laws and duties to rip off a buyer. Your the mastermind. 

      Again, as I said long ago all your doing here is showing your colors. I don't work with people like you, and I think that's a popular sentiment. You should rethink things. You don't have to scam your way through life. It's misplaced time, energy and effort. 

      Doing things legit is so much more chill. Allows to put those energies to better use. 

      I mean, come-on-man, this whole thread has been your confession of how you really want to figure how to F people. Your not that jazzy, nobody has any interest in doing crime for your profit. 

      0Reply
    • James McGovern
      OP
      Flipper/Rehabber · Bloomfield CT · Member since 2020 · 1k+ posts · 408 votes
      1y

      @Jay Hinrichs buyers are more than welcome to do a desktop appraisal. I welcome that

      0Reply
    • James McGovern
      OP
      Flipper/Rehabber · Bloomfield CT · Member since 2020 · 1k+ posts · 408 votes
      1y

      @James Hamling you are correct that I have chosen to not conform to how things traditionally work and will only accept what works for me. No reason to do otherwise in Connecticut where inventory is incredibly low

      0Reply
    • James McGovern
      OP
      Flipper/Rehabber · Bloomfield CT · Member since 2020 · 1k+ posts · 408 votes
      1y

      @James Hamling agents are a necessary evil and it will be good when technology totally replaces them

      0Reply
  • Aisha Umar
    Virtual Assistant · U, S · Member since 2025 · 56 posts · 15 votes
    1y

    Hi James,

    Creative approach it could incentivize stronger offers. Just make sure it's clearly laid out in the MLS notes and buyer agent agreement to avoid confusion.

    Two things to watch:

    1. Compliance – Some MLS boards may not allow variable commissions like this, so double-check local rules.

    2. Perception – Agents might steer buyers based on commission rather than fit. Could create tension if not handled transparently.

    That said, it's a smart way to reward clean, top-dollar offers if executed right.

    0Reply
  • Henry Lazerow
    Real Estate Agent · Chicago, IL · Member since 2017 · 2k+ posts · 2k+ votes
    1y

    This 100% “The most likely outcome will be every agent reading between the lines that your clueless in real estate, and acting like a greedy dink so we assume what else shady BS are you willing to pull over, like hiding various condition aspects.“ I would give my buyers a big warning if saw a list agent trying to pitch what you’re saying. I am not even sure how other posters here could do $10k flat. All my clients agree in advance what pay me as a buyers agent (2.5%) so if a seller offers less then the client just offers a little lower so I still get the 2.5%, it ends up netting exactly the same to seller as if they just did 2.5% initially. It’s not legal to show buyer a place without their fee agreed in advance anymore and I can’t see any good agent doing it for less, maybe Redfin agents but they don’t know investment properties like a BP type investor agent does and their business model has been decreasing for years losing market share to full priced firms like Compass. 

    2Reply
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