“One model for all [transactions] may work for some,” says Scott Simmons, an agent on Salt Spring Island, B.C. “One has to be flexible if one wants to be successful.”
Indeed, sales reps are increasingly offering their clients a flat fee for particular services or even an hourly rate in an effort to woo buyers and sellers who are turning to private sale sites, and other methods of buying and selling real estate that don’t involve licensed bodies.
Lively conversation in the REP forum, however, pointed to several wrinkles in need of an iron before a these types of alternative payment models could become widely accepted.
For instance, the average rate of service would have to be quite steep in order to justify an agent’s work. And, as commenter Erik said, “The real cheap clients are usually the most demanding/worst in my opinion.”
Another commenter called Mal said alternative payment structures are only feasible if they’re rolled out on a large scale.
“Unless everybody is on board it's not justifiable unless you charge buyers an hourly rate as well. Then you can make a living,” Mal wrote. “As for a flat fee, as long as it is high enough to make a living. If you think charging someone a couple thousand dollars to sell their house is sufficient, well, good luck.”
Still, Simmons said these models that deviate from the traditional commission-based ones need to be addressed on a case-by-case basis.
“It all depends on the client and the actual deal,” he wrote. “Clients want choice and I see nothing wrong with offering them options.”
As for-sale-by-owner companies become increasingly popular, more agents are pushing for alternative payment structures in an effort to woo sellers and quell any reservations about hiring a “costly” professional.