May 15, 2009
The Montgomery Surpasses Itself (Now Offering 5% Commissions)
Last month the sales office at The Montgomery extended their "unsurpassed offer" of 4.5% broker commissions through May 31.
And while it’s not yet the thirty-first, the sales office is now offering buyer’s agents 5% commissions on "select homes placed in contract between 5/15/09 to 6/30/09." Also noted, "new May 2009 pricing on several floor plans, starting from the low $300,000s."
First Published: May 15, 2009 9:15 AM
Comments from "Plugged In" Readers
If you were interested in this place why wouldn't you just go there sans broker and ask for a 5% discount? Not an acrimonious anti-broker question, just wondering...
Posted by: mac at May 15, 2009 9:59 AM
If you know how to negotiate and are confident in doing the deal you would.
Posted by: gowiththeflow at May 15, 2009 10:04 AM
Who's bright idea was it to make commission on real estate a percentage of house value. It's stupid. The last time I sold a house I offered $X flat rate to sell it with 20% commission on the amount over what the real estate agent first said she should list it for (before hearing my plan). She ended up working much harder, made more money, but so did I.
Posted by: Tom at May 15, 2009 10:37 AM
These are really pretty and nicely located units. The right way for interested people to interpret this is to make an offer directly. Don't bother with either a broker or the 5% figure unless it suits you. They might say no, but then they might be more flexible after they soak under water for a while. Don't worry about missing opportunities because knife catchers will be coughing these up later.
Posted by: Mole Man at May 15, 2009 11:32 AM
what an insult to buyers.
Posted by: condoshopper at May 15, 2009 12:37 PM
Exploiting the conflict of interest between buyers and "their" agents in such a flagrant way should be a red flag that the properties are overpriced...
When I sold my condo in 2006 I remember being surprised by two things about how we were dealing with the buyer's agent:
1) the buyer's agent was officially called the "selling agent". I.e., his job is selling.
2) this "selling agent" got a higher commission (2.5%) than my own agent (2%), even though my agent did IMO far more work
My guy's attitude appeared to be that the purpose of the "selling agent" was to be part of our team and "bring the buyer", sheep-like, to the table with his checkbook.
These experiences, as well as the broker commission bonuses described on this site, make me paranoid about the motivations of anyone who wants to represent me in a purchase. I hope that, when the time comes, I can negotiate an agreement with an agent that will align our interests.
Posted by: Po Hill Jeff at May 15, 2009 1:51 PM
Realtors need to be paid a flat salary. Buyer's agents never serve in the best interest of the buyer. It is in the buyer agent's best interest to have you pay as much as possible for the place.
Posted by: hkjhjkhjkkjh at May 16, 2009 4:43 PM
It is in the buyer agent's best interest to have you pay as much as possible for the place.
sigh. No, it isn't. 2.5% of 900K is 22.5K. 2.5% of a million is 25K. It is in buyer's agents best interest to get a job done. Because 2.5% of nothing is zero.
Posted by: anonn at May 16, 2009 5:59 PM
> Buyer's agents never serve in the best interest of
> the buyer. It is in the buyer agent's best interest to
> have you pay as much as possible for the place.
Let’s not pick on Realtors since they are just like (almost) all commissioned sales people and will try and make as much money as possible…
Then anonn wrote:
> sigh. No, it isn't. 2.5% of 900K is 22.5K. 2.5% of a
> million is 25K. It is in buyer's agents best interest to
> get a job done. Because 2.5% of nothing is zero.
Buyers agents always want to “get a job done”, but will also try and get paid as much as possible for each job (since they will now get paid quite a bit more than average to “get a job done” at The Montgomery I suspect that we will see a lot more agents showing buyers units at The Montgomery)…
Posted by: FormerAptBroker at May 17, 2009 12:16 PM
Buyers agents always want to “get a job done”, but will also try and get paid as much as possible for each job (since they will now get paid quite a bit more than average to “get a job done” at The Montgomery I suspect that we will see a lot more agents showing buyers units at The Montgomery
Yeah? "FormerAptBroker" ?
Between this miscall, and your talk about "gang members" and rogue brokers carrying Dillingers, you're pretty fishy to me. I don't think we'll be talking much in the future.
Posted by: anonn at May 17, 2009 12:51 PM
Let's see if we can rephrase this to better capture the conflict of interest.
It is in the buyer agent's best interest to have you buy the place, regardless of whether or not it's a good deal for you.
Posted by: diemos at May 17, 2009 12:55 PM
The sad part is that this fits the pattern of higher and higher commissions and then significant price drops that we've seen at essentially every development that has offered higher commissions.
An agent that had the best interest of the client at heart would tell the client that they not only should wait for the price drop, but once prices here drop, prices elsewhere have to drop as well. So as long as there is a development in a neighborhood that is offering higher commissions, you should never buy anywhere in that neighborhood.
But of course, they wouldn't offer the higher commissions if they didn't think that many Realtors will put their own interests ahead of their clients. So they offer them.
And the argument that a commissioned salesperson doesn't make money unless the deal closes applies to ALL commissioned salespeople, and all of us have had a commissioned salesperson sell us something that was not in our best interest. With a higher commission, that just makes it more likely here.
Posted by: tipster at May 17, 2009 1:35 PM
I have had situations where my agent "representing" me as a buyer failed to disclose other empty/unlisted units coming available in a Cow Hollow complex I was checking out. That would have been a strong negotiating point witht he current seller.
As soon as the unit I was looking into closed, another empty one came on a week later in that same building he was already aware of.
RE Agents artificially restrict supply of units to keep the prices -and their commissions up.
Realtors need to be put on salary as they represent an unuccessary economic drain for society as a whole.
Posted by: hkjhjkhjkkjh at May 17, 2009 2:37 PM
i just noticed that this development advertises on this site. wouldn't it make sense for them to heed the comments of the readership here?
Posted by: condoshopper at May 18, 2009 12:27 PM
I'm no expert on this stuff but there is speculation amongst us Monty residents that buyers w/o brokers can get up to 5% in some combo of upgrade credits and/or pre-paid HOA but they feel they've brought the base prices in line with the market. As someone who bought in Oct 2007 (moved in March 2008) I actually appreciate what they're doing in terms of holding unit value by offering concessions in other ways ... but of course the market will dictate if they need to do more with the pricing. I do think they'll need to make more concessions on hard-to-sell units like studios on low floors with bad light (on the alley side).
Posted by: SF Monty Rez at May 21, 2009 2:25 PM