Why Real Estate Agents Don’t Give Commission Rebates in NYC (2019) | Hauseit®

Why Real Estate Agents Don’t Give Commission Rebates in NYC (2019) | Hauseit®

Buyers Can Fire Their Agent Anytime It’s well known that home buyers never have
to sign exclusivity agreements in NYC, meaning that they can switch agents or simply fire
their agent at almost any time. This can be extremely frustrating for agents
if they’ve already sunk a lot of time into showing apartments to the buyer or simply
have spent a ton of time speaking with them. However, for agents who aren’t providing
discounts or rebates, they’ll at least have the chance to earn a full buyer agent commission
on at least some of the deals that go through. But if agents are giving a commission rebate
it can be extremely frustrating for a client to back out or cancel at a late stage. That’s because the rebate agent has spent
just as much time on the client as a full commission agent, yet the upside was limited
to begin with. So it can be even more frustrating for a customer
to cancel despite having limited the buyer agent’s upside from the outset. Therefore, the customer’s ability to cancel
at virtually any time really discourages most agents from providing commission rebates to
buyers. Commission Rebate Customers Are More Demanding While the majority of Hauseit Buyer Closing
Credit customers in our experience are quite reasonable and a pleasure to deal with, we’ve
also encountered the occasional buyer who doesn’t quite appreciate the fact that they
are getting a significant rebate of the buyer agent’s commission. As with any business, the Pareto Principle,
otherwise known as the 80/20 rule, seems to apply. There will always be extremely unreasonable
customers in any business, but it does seem that buyers who seek rebates are statistically
more likely to be extremely demanding vs regular buyers who aren’t seeking a rebate. The vast majority of real estate agents do
not provide commission rebates to buyers for this exact reason. Why would they bother doing so when they can
make several times as much money with much easier going clients? Why would they bother being harassed, insulted,
and called late at night just so they can earn a fraction of what their colleagues are
making on each deal? For the vast majority of full-time real estate
agents who traditionally rely on referrals and networking for new clients, providing
a rebate simply does not make sense from a simple cost-benefit perspective. Buyers Can Re-Negotiate The Rebate A buyer can easily regret not negotiating
harder for more of a rebate, and can attempt to re-negotiate the amount of the commission
rebate mid-way through the process. This can be extremely frustrating for the
agent if the agent has already spent a lot of time on the buyer, and is about to submit
an offer on behalf of the buyer. Decreased Deal Making Flexibility Any agent that provides a rebate or discount
to their customer in advance will have little to no flexibility to bridge any gap in price
between the buyer and seller that could make a deal happen. For example, it’s very common for listing
agents to offer to reduce the total commission in order to make a deal happen. If the listing agent offered to reduce the
commission by $10,000 total, then both the buyer agent and the listing agent would take
a $5,000 haircut. This is an uncomfortable situation for the
buyer agent if he or she has already agreed to a significant commission rebate.

2 thoughts on “Why Real Estate Agents Don’t Give Commission Rebates in NYC (2019) | Hauseit®

  1. Keep Up The Great Content. I Liked It & Hope The Video (Your Message) Keeps Growing.

  2. The grind always pays off. Maybe not immediately, but it eventually does for the ones who don't give up 🔥

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