[Digifri] NUMBER ONE Success System

[Tommy Lee]

http://www.noss123.com/

Potential points of contention for agents

Real estate commissions are becoming a point of controversy. Home values in
many areas have quadrupled over the past 20 years. This may be contributing
to the increased number of licensed agents and growing competition between
them. The number of real estate agents in areas tends to rise when home
values do, and the productivity of existing agents goes down. The rewards
have increased, but so have the demands of clients and business risks faced
by agents. In North America, agents have had to become familiar with
marketing through the internet as well as traditional print and other media.
Additionally the law is complicated with issues such as defects in housing,
grow houses and other issues of which the agent is the front line defense
for his client. There is more liability than ever in advising buyers and
sellers.

Another controversy exists for the commissions to real estate agents. If a
listing agent sells a property for any amount above the listed price, he in
turn will make additional income. In theory, this will motivate him/her to
get top dollar price for his client, the seller. However, if the agent
representing the buyer attempts to obtain a lower sales price for his
client, then he/she would make a lower commission. Thus, it could be
considered to be in the agent's best interest to advise his client to
purchase the property at a higher price.

In practical terms, there is rarely a great enough difference between the
listing (asking) price and the negotiated selling price to make a
significant difference between the commissions generated on each side, and
certainly hardly enough to justify an agent failing in his fiduciary duty to
obtain the best terms for his/her client.

Another potential conflict of interest exists when a listing agent in a very
active real estate market has incentive to sell properties quickly at
unnecessarily low prices in order to benefit from a high volume of sales.

In any case, agents who create satisfied clients and develop subsequent
referrals are likely to do far better in the long run.
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