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Do Real Estate Agents Make Too Much Money?
Before we get started on the topic of whether real estate agents make too much money, let me be clear that I am not about to tell you how much money I earn as a top producing Sacramento Broker, because how much I earn as a real estate agent is not what this blog about, plus it’s kinda gauche to discuss. I’d like to talk about how those in the 1%, whether it’s all people in the world or just the top agents in any given community, are often looked down upon and intensely disliked simply because they earn more money than somebody else. It’s like everybody gets dumped into one category, being earning more than the person who is upset about it earns.
A retired elderly friend of my mother’s was like this. He used to mail me cartoons cut out of newspapers about denigrating the wealthy, which also included attacks on real estate agents. It was as though he could not be a good defender of the downtrodden, or an effective political activist trying to right wrongs, without slamming those with a net worth higher than his.
Do some real estate agents make too much money? A few, perhaps, you’ve met some of those, but most agents also earn exactly what they are worth. You’d probably be surprised to know that the average salary of a real estate agent in the United States is less than $50,000. Out of that, agents expect to fork out overhead expenses, medical and insurance costs, federal and state taxes, so they’re lucky to end up with half that amount, if that.
When sellers sometimes ask if I will discount my commission, my answer is always the same. I don’t mind the fact they asked, but my answer is no because they are paying for superior service. They are paying for assurance that the million and one mistakes I have made and observed over the past 40 years won’t happen to them. What I have learned and pass down to them has a dollar value. That assurance carries a dollar value. If sellers want a less experienced agent, they can certainly hire that kind of agent for less money.
If they want a full-service agent who is dedicated to focusing on their needs and producing results, then they agree to pay my fee. I will fight tooth and nail for them to protect my client’s financial interests, which means that small bump that I charge over many other agents makes its way back into their pockets at closing. Do real estate agents make too much money? For what I do, I earn what I am worth. Just ask my clients.
Is Dropping the Sales Price of Your Home a Good Idea?
Among Sacramento Realtors, every agent has an opinion. And you know what they say about opinions, right? Among professional Sacramento Realtors with experience and a track record, the latter tend to employ time-tested strategies suited to the type of real estate market at hand. I understand that it’s hard to tell the difference between a Realtor who knows what she is doing versus one who does not. There is a lot of bad advice going around, which might be where some sellers picked up the idea that it is a good idea to drop the sales price.
I talked with a seller yesterday who said he was in no rush to sell and implied that when he received an offer, he could issue a counter offer giving himself the ability to wait a week or so to respond. He might be a lawyer, I don’t recall. Most of my lawyer clients I adore, although they tend to analyze themselves to death at times. However, I do know that a buyer is unlikely to wait a week for a seller to decide whether to take an offer. A buyer is likely to hold up a finger representing an international symbol recognized worldwide.
I’m not even sure what that means: I’m in no rush to sell. I suppose it is a defense mechanism, designed to imply that the seller is nobody’s fool. Nobody is gonna take advantage of that seller, because gosh darn it, the seller is no rush to sell. The seller will just leave that home sitting on the market to rot until it is avoided by every real estate agent and buyer in town. It’s akin to saying: we can always drop the sales price.
There are many things wrong with dropping the sales price. You may as well take out a gun and shoot yourself in the foot as an attention diverter for all the harm it’s likely to do. There are ways to fix the mistake of overpricing, but dropping the sales price is not the way to do it. You can read more in this piece today about The Problems With Dropping the Sales Price. I promise you, it’s an eye opener.
How Successful Sacramento Realtors Roll with the Flow
Just how do successful Sacramento realtors roll with the flow? Well, everyday living is a good example to answer this question. Work is a part of daily life. Most challenges require problem solving and adapting to change in the middle of unexpected issues and challenges.
Tonight, I was getting ready to work on three market analysis studies and write a blog. Lo and behold, I sat down on my laptop and boom the power is instantly out at 7:30 PM! I am sitting in the dark. SMUD reports more than 1,000 homes are out of power in my area. My mom is here, and it is dark and the dogs and cats are tearing around underfoot. First things first, the flashlight app on my phone, I turn it on. Next, I suggest my mom stay put, as we do not need her falling!
We have lanterns in every room, candles and extra batteries. We have solar lights located outside at every exit door. Also, of course a few Mophie USB port phone battery backups, and a hot spot for internet. A daily must is keeping your laptop charged. Being well prepared and doing your homework always pays off.
Living in the country and working from a home office, a Realtor must prepare for every outcome. So, how do successful realtors roll with the flow? Weintraub & Wallace Realtors do just that. When the unexpected happens, we keep our oars in the water and paddle like hell. You must move with the current because there is no choice in that. You maneuver to avoid obstacles while keeping calm but highly focused. Skill comes into play as knowing how to respond is the key. Top of mind is to reach the destination as quickly as possible using your decades of experience on the journey.
How do successful Sacramento Realtors roll with the flow? We navigate forward no matter what the obstacle. Always a Plan B. Call Weintraub & Wallace for a smooth sale at 916-233-6759.
— JaCi Wallace
Authentic Realtors Display a Voice of Reality and Reason
Authenticity seems to be a rare commodity in a search for authentic Realtors. You seem like a real person to me, is what many of my clients say when they call for the first time. Of course I am a real person. Do you think I am a robot? An alien? A cat reincarnated in human form? But what I think they are trying to say is I don’t seem like a salesperson.
As though a salesperson is an evil creature to be avoided at all costs. Because you know what a salesperson will do, right? They will sell you something you don’t want. Which is a real fear of many people when dealing with agents. People worry that a salesperson will take advantage of them. So they search for an un-salesperson, what we call authentic Realtors.
Grounded is another term I’ve heard tossed about. But that’s just trendy. Besides, if you’ve been following the massive 7.5 earthquake in Indonesia, you will learn about liquefaction. This is when the ground turns into soft mud after an earthquake and swallows up people. In Petobo, in the Palu area, when the soil turned into mud, it caused houses to change direction, slide miles away and many sunk below the mud, with only the roof tops poking out of the ground. There is no such thing as grounded. It’s simply a perception.
But authentic Realtors are a reality. These are people who don’t read scripts because they don’t need it. They’ve been around the block enough times to know what to say to people and how to say it, which is with kindness and respect. So many agents I know are afraid to counter a client’s belief or statement. Because they are trying way too hard to be “friends.” They don’t want to make an enemy or cause bad feelings, so the bad news doesn’t reach their clients. The bad news is whatever they think the clients should know but are afraid to disclose.
Give it to a person straight and then offer solutions, that’s my method of operation. Yet some Sacramento Realtors will say: well, it sucks to be you and walk out. Which is what an agent is doing when they know a client is thinking the wrong things and, by extension, doesn’t possess enough information to choose the right moves. When that agent could deliver the information the client needs, but she doesn’t.
Authentic Realtors share information freely. Real agents aren’t worried about competition or how other people will view them. They are not self conscious; but they are self aware. Delivering the truth about a situation is not always easy, but it is necessary. If the client still rejects the notion after that, well, at least her Realtor extended the effort.
The Many Types of Realtors in Sacramento You’ll Find as Listing Agents
Match the types of Realtors to your specific needs.
Without a doubt, I know a huge population exists that does not realize there are many types of Realtors in Sacramento. Quite often the person who doesn’t realize this is the person who thinks they already know everything. Although, by god, the one thing they know is all Realtors are the same and there are no different types of Realtors. I hate to say it, but that “one type of Realtor” in their mind is generally an agent they do not like and they do not trust. I can sense that when I talk with some prospective sellers. It’s in the language they use and the attitude. For some silly reason, I try to change their minds. Sometimes, it doesn’t work.
I feel it’s not fair that they lump us all together just because they had a bad experience. It’s fairly easy to have a bad experience in real estate, unfortunately, Further, they don’t know what certain types of Realtors do. No idea. They only peer over the fence. These guys are not down in the trenches. In fact, I’ve told sellers that if all they want is a Realtor who will plop a sign in the yard, I am not that agent. That’s not what I do. Those are the services offered by a discount agent.
Lately, as we move into the fall real estate market in Sacramento and prepare for winter, I have had to turn down more listings than those I’ve accepted. One seller claimed she did not need to meet with me and refused to let me see her house. Why? Because she already calculated the price she expected to get. After all, she has sold a number of homes that she could count on one hand. Moreover, she rambled on about her importance. How valuable her time is, the type of advanced degree she possesses, and then detailed her work life. Her point? She clearly had no time for “condescending or rude people.”
Ha! We agree on that issue.
As for types of Realtors, the most common type of Sacramento Realtor is the agent who sells 4 or 5 houses a year. That agent probably sells homes close to the neighborhood where the agent lives. These guys are not sitting in front of their computer every day working. They enjoy a life. They have hobbies, friends, spend time with family. Hang out at the office. Play golf. These types of Realtors will often haggle over commission and undercut the competition if it means they will get the listing.
Next, there is the discount Realtor whose main calling card is they will work for dirt cheap. Perhaps their company foots their salary or maybe they figure volume will make up for the money they lost. Maybe they just aren’t worth more. I dunno. But they do know how to stick a sign in the yard and plop a listing into MLS. Do they answer the phone? Generally not.
Other types of Realtors are generally full-service and either a veteran, somewhat experienced or brand new.
The type of Realtor I fall into is unusual because I charge the most. My focus is getting the seller the highest amount a buyer will pay. That amount might not be at appraised value. In fact, the appraisal might come in low because I’ve sold the home for more than it appraised. Every transaction is unique and custom to me. Each listing is my baby. My actions produce ecstatic sellers. I specialize in listings. Not buyers. I do not work with buyers anymore, but my highly trained and educated team members do.
There is no real estate school for Realtors. Agents learn on the job. The higher the number of transactions an agent closes, the more knowledge an agent accumulates. When an agent specializes in doing only one specific type of function, you can imagine the level of sophisticated strategy she offers her seller. Most of my listings tend to sell over list price. Sellers working with me rarely do repairs and their transactions are smooth.
