Why should a seller offer compensation to the Buyer’s Agent?

In a word, history. Due to the 100-year history of bundled (aka coupled) commissions, the overwhelming majority of buyer brokers use this business model.  Washington is at the forefront of change--but... Most buyers still rely on the seller to pay their broker's fee, so most brokers won't show a property that does not offer seller-paid compensation  Therefore, the single most important decision is to offer a fee to the buyer broker. The Washington State Buyer Brokerage Services Agreement allows the possibility of screening out properties that do not offer to pay a buyer broker fee.

 What’s the difference between ‘commission,’ ‘compensation,’ and ‘brokerage fee’?

The terms are used interchangeably.

What’s the problem with the status quo for agent commissions?

Sixteen class-action lawsuits (and counting) and 40+ years of Federal Trade Commission and Department of Justice Antitrust  investigations and regulatory activity did not come out of thin air. Buyers and sellers deserve a transparent window into the industry and the opportunity to meaningfully shop price and service levels. “Economists think it’s very odd that the commission is the same for every deal because objectively, some deals are harder than others,” observes Jenny Schuetz, a senior fellow on housing at the Brookings Institution. “Some customers are harder to deal with, or some houses take longer, or the negotiations are more complicated, and that’s not reflected in the commission.”

What do brokers do to earn their commissions?

Real estate brokers are trusted advisors, advocates and consultants. We bring years of experience to the table, arrange viewings, advise on programs, negotiate, help you write a compelling purchase offer, guide you through inspections and due diligence, and coordinate the closing. We have been through this process hundreds  of times. We have actually been inside the properties; we know price and value. We help you think outside your paradigm and offer another perspective. We offer a steady hand in a very emotional and exciting time.

What is the downside of changing the agency law?

Confusion. Some brokers will not be able to articulate or demonstrate their value to their clients. They might not know the new forms or how to use them. They may misunderstand the intent of the new law. Unfortunately,  buyers and sellers represented by such agents will also be disadvantaged.

How will this affect me?

This is a great time and place to be a seller and/or buyer! You now have the ability to meaningfully shop for real estate brokerage services. Choose the price and level of service that works best for you.

What is the difference between a listing fee and a buyer fee?

 The seller pays the listing fee to her broker as compensation for representing her in the transaction. The buyer should do the same! Why haven’t we? See the history section elsewhere.

My Realtor®  friend tells me ‘you get what you pay for.’ Are you going to disappear as soon as I sign up with you?

Your friend is correct. If you want to support the traditional model and method of real estate brokerage, do it! A great Realtor®  friend in the business told me over 20 years ago that one of the great things about this business is that there are as many ways to do it successfully as there are people. What Evolution Real Estate Company offers is an updated and streamlined way to do business that allows you to keep about $7,500 on a $500,000 transaction while giving you better, more experienced, service than most traditional firms and brokers. If that sounds good, then I’d love the opportunity to talk with you more.

I thought you were a good value before! Why would you charge less?

Competing on both price and service has not been possible until now. The real estate brokerage industry has been evolving and is now at a point where the chances are better that firms like Evolution Real Estate won’t be put out of business by disparagement, steering, and filtering of listings. Low barriers to entry in this profession have resulted in a huge number of agents who do a small amount of business–but at a very steep cost to buyers and sellers. Teams and large firms have lucrative commission sharing agreements built into their business models. They require larger commissions to sustain themselves. I’m in the sweet spot – I do healthy volume and I am not burdened by commission sharing agreements.