Need advice quick...long!

They should definitely be reducing your commission.  Was this not addressed in your listing contract?

 

Unfortunately I think you are seeing what is a true statement, typically the first offer is your best offer.

 

What do your comps say?  Surely they are providing some info to you on whether or not this is a good price compared to what has sold recently in your neighborhood?

 

Personally I would not rush and I think it sounds like you are being pushed into accepting their offer.

Sell it.

No one wants to feel rushed or pushed into doing something, but consider:  you have been on the market for one year and your only offers were for $270,000 and $268,000.  There is a good chance you will not get a better offer than that and you may (down the line) get even lower offers.  So which is worse: selling for $268,000 or not selling at all?  You say you "deesperately need to sell."   Think about how you will feel after your house is sold and you can move on with your life.  I think you should seriously consider taking their offer.

Ok how about this. You tell the realtor that you will accept the offer as it sits with a 40 day close if he will accept an adjusted commission of 1% ($2680) instead of 3% ($8040) effectively adding $5360 to the offer making it $273,360. The realtors are not really there to help you on this specific sale so I would ask them to help you close by crediting you part of the commission given the circumstances with so little time spent on the deal by the husband realtor. Do not be sheepish about it either. Ask firmly and explain that you want the deal to go, but you will not accept this offer without a concession on the commission because you feel 1% extra is fair compensation given the double agency of the deal.

I think that Austin has been stable overall, but even the more stable markets will feel the effects of unemployment and bank consolidation this winter. If you want to sell, spring is not likely to better. If it were me, I would try to get it closed before Thanksgiving. I know it is less than you wanted, but you really need to decide if you want to sell or not. This market has been very volatile and now is not the time to wait and see if you already know you want out.

If you decide to sell, get a quick close date locked in and walk away knowing that you are better off. The faster you can get through escrow and inspections the better. I know it has to be hard. Listen to your gut and decide what you think will be better for you 6 months, a year and five years from now.

AggieGal,

 

Consider this, your realtors stand to make 6% of nothing if they can't help make this deal go through. However "unrealistic" $335K is/was, you're already come down to $290K. What has your realtor done to help...and now they stand to make both ends of the commission?

 

When I sold, my realtor set it up so that it was 6% (3% to each), or 4% if he handled both ends of the deal (i.e., letting me keep 2% while he made an extra 1%). When the house finally sold, it was to a buyer that was going to walk over a $1K difference in the price...and the buyer reps discounted their 3% to make the deal go through (even though they still walked away with more than $10K for their end of the deal).

 

So...

 

At 6% on $278K, they stand to make $16.7K, where they would have made $8.7K on a deal at your current asking of $289K. I don't believe, given the $20K gap in the asking/offer, that it is unreasonable at this point to ask your realtors to cap their share at $10K and reduce your asking. At $278K and 6%, you'd clear $261.3K after paying realtors.

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I did a quick spreadsheet and rough numbers, only looking at asking, selling, and commission.

 

At $278K and 6%, you'd clear $261K. If realtors agree to a flat $10K commission, you could realize the same $261K at an asking of $271 - which is only $3K higher than offered.

 

You're looking to sell the house, and the agent is looking to get paid. There's no reason that both of you shouldn't shoulder some of the cost.

They're taking you to the cleaners on the commission.  Instead of making $8000, they're taking advantage of you and charging $16,000.  That's a full 8k that you'd be able to reduce the selling price by.

Wow. Funny how the first conclusion everyone jumps to is that the realtor should reduce their commission. I wonder how many of you would feel if you went in to work tomorrow and found out that your pay was reduced by a third or more. Just saying.

 

We're all feeling the crunch right now - not least of all the people in the real estate industry. I don't necessarily think its fair to ask these people to take the hit - a certainly not for the reason that they're married! You agreed to pay 3% to each side but now that youve found out your house is not worth what you thought and your agent has brought you not one but TWO offers, you want to reneg. Hmmmmm....

 

To be fair, I do know that commissions can often be negotiated, although I think its more fairly handled at the time of the listing agreement. Plus, money is money and is doesn't hur to ask. But I'd advise you to broach the subject carefully and graciously. Don't let the posters above convince you that you're entitled to it. You're not.

 

Good luck with your offer, though. I hope you can work it out - I know its not easy right now. I hope you'll post again. I'm curious as to how your realtor handles it!

I agree. Offer the husband realtor the 1% commission on the current deal. Start strong and be somewhat indignant that want you to pay the double commission. If he says no, you can decide what you want to do from there.

This hubby agent jumped in after spending no time on the deal in helping these people find your house. If they had remained unrepresented, your agent likely would have taken only a small amount extra to represent them. Ask for what you want and go from there. Our good thoughts are with you.

Hmmm. You do have a point, there Sunnyview. I had overlooked the detail that he is began representing them after the property had been identified to them. Yes, there is some justification in asking for that reduction. I stand corrected.

 

But, fair warning - the buyers also may also feel they have some claim to benefit from that commission reduction.....

Jan,

 

The first conclusion was not to reduce the realtor's commission. The seller has already dropped their asking to $290K from an original $335K, and another $11K to get to $279K (I like round numbers). During the same time, the realtor saw their potential commission go from $10K to $8.4K. So, the sellers are looking at a $54K paper loss, and the realtor at $1.6K. Looking at both ends of the deal, the realtors were looking at a $20K payday and now are looking at $16.8K...all while "their client" is looking at a $54K loss?

 

In my world, it is time for the realtors to jump in and help make this work - even if it wasn't a husband/wife team. I never said, nor implied, that the "seller" was entitled to renegotiate the commissions. But, the initial negotiations included a $335K asking price...and this has been "renegotiated" to $278K, and pressure is being applied to further "renegotiate" to $268K. At the point where the seller is being asked to reduce their expectations to make the sale happen, I believe it is fair to ask all involved to modify their expectations as well. After all, it is really a four-way transaction (buyer, seller, and two agents).

I am not generally somebody who thinks that price cuts should come off out of the realtor side because I agree with what you said. Realtors do a professional job that they have been contracted up front to do with full understanding about what the cost for their service is no matter how long or short it takes to provide that service. That being said, this deal seems a bit dirty to me. I am glad that you took another look at it Jan. And you may have a point about the buyer, but I would think that since the seller bears full cost of paying the realtor that the buyers might be happy enough with the free representation if they get the house for the price they want.

I hope everything works out.

Update....we took the offer at their offer price.  They were unwilling to negotiate and we NEED to sell before it gets any worse.  Our agent is giving us 1% back, which is .5% less than we asked for.  We are ok with it, and we have an inspection already set up for tomorrow.  Thanks to all....wish us luck on the rest of this ordeal.  Time for a beer!

You made the right decision. Now just hope they can get a loan/close.

Good job!

Great conclusion for everyone & fantastic advice.

Good luck!!

I don't dual represent (both sides) too uncomfortable to protect the interests of two parties... Okay...so I am on both sides of this...I am an agent, and see the agents point...we agents are in a risky business....meaning, we take on a listing spend money, and the seller pulls the listing or the house doesnt sell, we are out all that money, time and effort... We truck buyers around who don't buy or go with another agents...so for a real estate agent, in my mind, the reward should equal the risk....If you agreed to 6%, in the first place what difference does it make to whom the money goes......because your realtors husband will have to do everything another agent, who brings a buyer would have to do, who would be getting 3%

 

Okay..now the other side...as a homeowner, you are looking at that 6% going out the window at a price you didn't want to sell it at!  So, maybe you go back to your agent and say...can we amend the listing agreement, you all get paid I dunno 4-5%, then I'll drop my price, and we all win!!  If the buyer doesn't buy...you are out, and so are they..time for everyone to give a little... :)

Your question actually is 3 questions: 

1) Dual Agency or Seller Representation.  I'm assuming the wife is the listing agent & the husband is not, which means you have a SIGNED CONTRACT called a listing agreement spelling out the commission.  Dual Agency may or may not be legal in your state (it is in Washington).  Most Residential agents (not Commercial Agents) will immediately go for watered-down agency/Dual Agency to get paid, because they don't understand Dual Agency.  In Washington state, you may only be a Dual Agent if the listing agent had a prior buyer agency relationship with the buyer prior to showing that listing.  Said residential agents wanting to double-end the commission will write the deal as a dual agent with a buyer they did not know just to get the deal done is a lawsuit waiting to happen.  Why? They didn't have a signed contract with that buyer, only with the seller & now they want watered-down agency for both parties.  I double-ended several listings last year and represented the seller every time because I was able to explain agency to the Buyer-told them by law I owe honesty & fairness & to look at my role as a deal facilitator and will put down the buyer's desires on the purchase & sale agreement and work to make sure the transaction closes.  The best agent to sell a listing is the listing agent.  It would seem that a husband & wife real estate agents would have a challenging time actually representing each side properly without conflict of interest so I would be suspect about it.

 

2) Everybody wants a good deal.  I'm waiting for the 1st person to tell me they want to over-pay!  A Contract is a contract, so since you signed a listing you are bound to that contract which spells out the commission, unless you're dishonorable & like denying somebody their paycheck.  If you wanted commission exceptions, you should've had that written in when you signed the listing agreement.  For all the non-real estate agents that promote cutting commissions, may we ask who is your employer and ask if it's alright that you get paid less this week so the company may be more profitable?  Agents that cut commissions are not very professional and are akin to "whores"- doing a something they don't want to do because they need the money.  Any seller that asks me to cut my commission in the beginning, I tell them "If I cannot defend my professional self-worth (my commission), do you really expect me to represent you in helping you net the most money possible?"

 

3)  Mr. & Ms. Seller, you are the highest bidder on your home.  What do I mean?  You are willing to pay more for the house than the Buyer will.  Buyer's are the market and they determine what an object (house) is worth.  No Buyers means no market, which is why our country is having a financial dilemma since there are no buyers/investors for the bad mortgage paper/CDO's the banks/lenders are trying to sell via Wall Street.  If you want to sell the home NOW, sign the contract or continue to gamble, wait some more and hope you get a higher offer.  Hopefully you are not in a descending market like majority of the country is, which means every day your home sits on the market means more inventory coming on, meaning more competition; demonstrating the Law of Supply & Demand, which means when the supple goes up, the price goes down.  Sign the offer & forget about the commission or agency.  The listing agent is the best agent to sell the listing & since no other agent brought a buyer buy let them get paid for doing their job as agreed to by the listing agreement you signed.