Your commission: the best thank-you gift of all?

by Olivia D'Orazio02 Mar 2015
As sales reps increasingly compete with one another for business, some agents are giving back to their clients – using their own commissions.
Agents with The Red Pin Brokerage offers their clients a 15 per cent cut of their commissions on the purchase of a resale property as a way to “thank” clients for their involvement in the buying transaction.
“The main reason for the rebate program is that working together [with clients] to find the properties is a dual effort more now than it has been in the past,” says Michelle Ryckman, an agent with The Red Pin. “Before, an agent would pick you up and bring you to the properties. But with the advent of the Internet, we realize that the client is more involved in the process.”
These types of programs, however, have come under scrutiny as sales reps accuse those who use them of “buying” clients. Ryckman argues that it’s just one way she differentiates herself from the other 40,000 sales reps in the GTA.
It’s not just new-age firms that offer these types of programs, says Edmonton agent Duane Ritter, pointing to Century 21’s Air Miles incentive. Ritter, though, says he finds no fault in the brokerages that advertise their services this way – that’s free enterprise, after all, he says.
“Hopefully we live up to what you’re paying us or what is agreed upon at the beginning,” he tells REP. “I feel my service should warrant what I charge. I can’t see giving an incentive to use me, other than I provide the best service I can.
“I’m not saying it’s bad, it’s just not my particular style.”


  • by Kevin Andrew 3/2/2015 11:44:19 AM

    maybe we should all work for free and have lots of happy clients/friends. This is a fiercely competitive industry. Offering and advertising comm kickbacks/discounts on the buying side is foolish. This will spread amongst the weak and in time affect all of us. Try coming up with professional innovative marketing that buyers and sellers see the value in rather than giving away commission to compete with your colleagues.

  • by 3/2/2015 11:46:08 AM

    I'm curious. Do they also provide a commission reduction for doing the second transaction or is this in lieu of? Many sales reps do reduce the listing commission if the seller is also buying. I would like to know if the ones advertising this 15% are doing both. Also, is this considered an inducement?

    Cathy Burton, Broker
    Coldwell Banker Coburn Realty

  • by Greg R 3/2/2015 12:59:33 PM

    Been there, done that. I would hope that because Ive done such a great job for my clients, they would give me an extra 15%, but we know that aint going to happen. The public that caters to those agents because of the low commissions being offered, or because they've been lured in by the promise of 'kickbacks" rarely employ the same agent again, or rarely give a referral, because they are in it for whatever they
    can get out of it, and at the end of the day so does the the relationship. Desperate discounters never last in the business long enough to get a repeat customer anyways. Having said that, should kickbacks become common enough, then it becomes the expectation. I'll never forget the client who, despite receiving excellent service, sent me an email wondering why she didn't get a dinner after all was said and done, because her friend did, and so that became her expectation.


Is a Toronto foreign sales tax a good idea?