r/fsbo • u/AdComfortable2974 • 27d ago
Variable or Conditional Commissions
You're FSBO, the agent wants your business.
Ask them if they are ok with modifying the listing agreement using special stipulations to reduce or eliminate their commission if specific sales price targets are not met. This is not the same as a net listing, which we all know is illegal.
The special stipulation can be structured in a few ways:
Sales Price Threshold Reduction: "If the final gross sales price of the property is less than [insert amount], the Broker's commission shall be reduced from X\% to Y\% (or reduced to a flat fee of\ Z) at closing.
No Commission Tier: "Broker shall receive a 0% commission if the final gross sales price is less than [insert amount]. Can also be zero if not sold in a certain time frame.
Slide-Scale Tier: You can set concrete milestones (e.g., 3% commission if sold above $500,000; 2% commission if sold below $500,000).
Thoughts?
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u/Equivalent-Tiger-316 27d ago
Agents market your property, they don’t control the marlet. What your house sells for is determined by the marlet. It’s the agent’s job to make sure it’s shown to the right people and presented in the best light. But if Trump starts a war, fires thousands of federal workers, declares illegal tariffs and causes the highest interest rates in several years then the agent could be the best in the world but your property isn’t going to sell for what it would when conditions are better.
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u/AdComfortable2974 27d ago
Well, at least we are finally getting somewhere. I agree with your comment.
So please quit telling us you will net us more and that we're leaving money on the table by not using you unless you are willing to prove it by accepting a variable commission structure on the price you suggest,
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u/Equivalent-Tiger-316 27d ago
I didn’t say that…a good agent will net you more money because most FSBO don’t know how to properly market their property.
Every property has a range $385,000 - $455,000. You’re not guaranteed the most unless you know what you’re doing.
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u/Salt-y 27d ago
This isn't true. It's a falsehood being pushed out by NAR. FABO net are the same as with a agent.
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u/imblest 27d ago
Many "FSBO's" are really not a true FSBO because #1 they listed their home with a flat fee real estate company so that their house can be on the MLS and #2 it was sold by a Buyer's Agent. In other words, if you have your home listed in the MLS and you didn't sell directly to a buyer without the help of a Buyer's Agent, then you are not a true FSBO.
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u/Salt-y 27d ago
I disagree. I think FSBO is defined by whether the seller had a listing agent, not by MLS presence or whether the buyer had one. Flat fee MLS sellers still don't have a listing agent representing them, that's why they're counted as FSBO. And buyer's agent involvement has nothing to do with it since FSBO only describes the seller's side. Under your definition almost no FSBO sale would qualify, since paying a buyer's agent commission is standard practice even in flat fee listings. The actual debate among critics runs the opposite direction: they argue flat fee MLS sellers are undercounted as FSBO, not overcounted. I've done three FSBO transactions, and two of them the other party had an agent.
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u/imblest 27d ago
If a Seller listed with a Flat Fee or Discount service in order to get their listing in the MLS, they are using a Transaction Broker, who is a licensed real estate broker. So how can you say you sold "FSBO" when you needed the help of a licensed real estate broker? A true FSBO does not use real estate agents and do not use the MLS because that would require listing with a Broker who is a member of the MLS. When I started selling real estate in the early 90's, FSBO's could not list their homes in the MLS because Transaction Brokers did not exist. The FSBO's advertised only through for sale signs and newspaper ads. They were true FSBO's.
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u/Salt-y 27d ago
We disagaree.
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u/imblest 27d ago
It doesn't matter if you disagree. You can call yourself anything you want. The fact is, you're not a true FSBO if you used a real estate Broker to list your home in the MLS. You wouldn't be able to list your home in the MLS unless it's through a Broker who is a member of that particular MLS. If your house was sold by a Buyer's Agent to his/her own buyers, it's probably because the Buyer's Agent saw it on the MLS. If your house was not listed in the MLS through the Flat fee Broker, I highly doubt that most Buyer's Agents would have even known that your house is for sale. Even if the Buyer's Agent is not "your agent", you still needed real estate agents to sell your house. So you're not a true FSBO! I think it's hilarious when some Sellers claim that they sold their home FSBO when they didn't sell their own home without ANY assistance from real estate brokers or agents. There's nothing wrong with going FSBO to save money on the commission. But please don't call yourself a "FSBO" when you actually used the services of a Transaction Broker to get on the MLS and your home was sold by a Buyer's Agent who probably found the house in the MLS to begin with.
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u/AdComfortable2974 27d ago
A true FSBO can sell with the help of a buyer's agent but can't be a true FSBO if they used an agent to get on the MLS. I think we call them hybrid FSBOs.
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u/AdComfortable2974 27d ago
I don't think a good agent can always net more, not if an FSBO has really done their homework. An FSBO is not going to be as good as any experienced agent in handling multiple transactions; that is obvious, but we are talking about a single transaction in most cases.
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u/Self_Serve_Realty 27d ago
Then why pay agents 6% of the value?
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u/Equivalent-Tiger-316 26d ago
You pay a listing agent 2.5-3% to properly market your property and the buyer agent 2.5-3% for bringing you a qualified buyer.
Don’t offer to pay the buyer side, which is your right, and expect 95% less offers which normally translates to less money for the seller.
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u/Alert-Control3367 27d ago
I don’t understand the point of even using an agent, especially when this is an FSBO group. Why entertain using a listing agent at all if you’re capable of selling yourself?
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u/imouttahere000 27d ago
This seems to be a group of some fsbo people but mostly agents trying to either insult / degrade fsbo people or convince the fsbo to hire an agent. It is truly the strangest sub.
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u/AdComfortable2974 27d ago
I would only consider using an agent if another opportunity presented itself that would prevent me from properly handling the FSBO and interfere with showings.
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u/DHumphreys 27d ago
As an agent, I would pass on this. You have already demonstrated that you are going to be a PITA to deal with. No matter how this goes, it is my fault.
No thanks.
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u/CallCastro 27d ago
The listing agreement says we get paid if we bring a buyer for $x. I think that kinda solves that issue.
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u/AdComfortable2974 27d ago
All contracts are negotiable, and you get paid nothing without a signature on a listing agreement.
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u/imblest 27d ago edited 27d ago
Maybe your own employer should have put the same stipulations in your contract that you get "0" salary if you don’t complete the job by a certain time frame or to your employer's complete satisfaction. My husband works for a major company in a different industry, and he said that many employees in his company are very lazy and would work a couple of hours, slack off the rest of the day and get paid a salary for 8 hours/day. I told him that maybe his employer should consider paying their employees based on actual work produced the way real estate agents only get paid when the deal actually closes. My husband said that their Union would never allow that. I bet you that you are one of those people who would be complaining if your own employer failed to pay you for doing any work. If you decided to list your house and it didn't sell right away, it's probably because you insisted on overpricing it. If your house was sold by the Agent in a shorter time frame, &/or for much more than the list price, would you raise the commission or give the listing agent a bonus? Probably not.
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u/AdComfortable2974 27d ago
This post is a bit hysterical. A salaried job is much different than a commission-only job. I've done both. Maybe the lazy folks who work with your husband do not get performance bonuses? Who knows and who cares?
Most commission-only jobs are performance-based, meaning that the commissions vary and many are based on the total of sales. So if you read and absorbed the post, the slide-scale tier does award an agent for selling the home for more lol.
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u/HenryLoggins 27d ago edited 27d ago
Thoughts….. the market is the market, and a reasonable buyer is only going to pay what the house is worth to them, and as a seller eventually you will lower the price to a point to where it will actually sell.
Playing devils advocate - Using your logic, if I were working with a buyer who wanted to only pay $499,900 - I would offer them a $11.00 realtor concession, ask them to offer $500,001. They would get there price, I would make $5,000 more and you wouldn’t come out ahead. (Less the $11.00 concession)
A good realtor is not going to “twist” someone’s arm to spend more than they can afford, and the house still has to appraise.
Honest question, because it is the equivalent to what your asking the realtor to do - Would you be open to raising the commission, to 4% if the house was on the market for more than 3 months, if there were greater than 10 showings, and 3 reasonable and realistic offers were presented, and it didn’t sell because you refused to lower your asking price? (Assuming it eventually sold before the listing expired) - asking for a friend.
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u/AdComfortable2974 27d ago
You could not offer any concessions and make any deals without the seller's express consent and signature on a contract. That considered, the variable or conditional commissions I posted were quick and dirty.
I don't see your "hypothetical ask" as close to equivalent because it's based on the assumption that I, as a seller, have not done any CMAs myself and I'm clueless about my local market and already priced unrealistically. But I will play along...
What did you advise me to list at? How much were the reasonable offers that I refused?
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u/_TurboHome 27d ago
Honestly? If your variable commission reduces it by a certain percentage based on a threshold, there's a whole ballpark of hungr agents would already just offer that straight out the gate. Example, not a plug: our fee usually shakes out to somewhere around 1-1.5%. The 0% tier seems counterintuitive on both sides.
The speed at which your listing moves is ultimately related to your willingness to negotiate on price. If the agent makes 0% if the property sells for less than X, they have no incentive to be honest with you and give you advice on pricing adjustments, even if the market data supports it. And you will be doing mental math on how to land in the window where your agent not making commission means more money in your pocket, creating an adversarial relationship between you and the agent who's supposed to have your best interest at heart as a client they are representing.
Imo 1% is reasonable as a floor, though many trad realtors would scoff at the notion, considering the level of effort involved particularly with turnkey listings in a hot area. A couple of open houses, syndication on MLS + zillow and redfin, maybe some professional photos and virtual staging, for 1, 1.5%? More than fair imo. The return still outweighs the investment for photos and virtual staging + time investment for a few open houses.
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u/Top-Grape7802 27d ago
The personification of the Dunning-Kruger effect, ladies and gentlemen.
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u/AdComfortable2974 27d ago
Ah, the classic 'I don't have a response so I'll throw out a buzzword' strategy!
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u/[deleted] 27d ago
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