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Flat Fees – A Buyers Dream

When you scrutinise an agents agency agreement, you notice three interesting things.

  1. The length of the agency agreement is usually 90 days+
  2. Commonly sellers agree to flat %’s like 1.5% of the sale price, and flat-fee amounts like $10,000 or $15,000
  3. The agent gets paid at settlement

If you don’t think this 3 incentive elements making a difference in what the seller receives at the end, then you must think again.

The truth is that agents are very shrewd negotiators – the primary approach for most agents when it comes to negotiating thier agreements is The Path To Least Resistance.

The seller thinks that they have had a win in getting a flat-fee or screwing the agent down as low as possible. The agent relents and provides ZERO resistance to the seller, and as a result, the die is cast the negative incentive is set in stone.

The priority, in the flat fee payment at a settlement agreement, is the speed of the transaction, not the pursuit of the best terms.

Selling for full price in week one is the target objective. Sure all agents want the best result for their clients; however, if you agree with the principle that the best buyer comes in week one, then you can convince yourself a full price offer where you as the agent get 1.5% no matter the result is in the best interest of your client.

As a buyer knowing how to capitalise on this lies in knowing what agents are incentive-based and what ones are a flat fee.

Three are several strategies to capitalise on this and when you work with me ill let you know what they are.

Backyard Auctions

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