When Is A Good Time To Bargain On Commission?

[ryooki 0]

Hi All,

When do you think is a good time to bargain on commission? Given that no documents were signed on Exclusivity as well as Commission rates. I do understand that the norm nowadays is 1% for Buyer Agent and 2% for Seller Agent. However, if the Buyer Agent is unable to secure a good price on our behalf (i.e. bargain on the COV), are we obligated to pay the 1%? We have given our word (no signed documents) that if the agent can help us source a unit, we will let him represent us on the selling of our unit. This is effectively giving him the 1% and 2% of the sales proceeds amounting to more than $10K.

We have already made an offer on the unit that the agent has helped us find, but the price was at the full valuation plus the full requested COV and an additional $2k. As we really liked the unit, we agreed to the price, but now thinking back, we begin to wonder if the agent has done his job to help us bargain. I know if we are unhappy about the agent's performance, we can let other agent represent us in the selling of our unit but we do not want to resort to that. Also we are worried about being saboed by the agent as well.

So am I stuck with giving all the 1% + 2% commission though I felt he could have done a better job?

Thanks.

[dokiesim 0]

Hi All,

When do you think is a good time to bargain on commission? Given that no documents were signed on Exclusivity as well as Commission rates. I do understand that the norm nowadays is 1% for Buyer Agent and 2% for Seller Agent. However, if the Buyer Agent is unable to secure a good price on our behalf (i.e. bargain on the COV), are we obligated to pay the 1%? We have given our word (no signed documents) that if the agent can help us source a unit, we will let him represent us on the selling of our unit. This is effectively giving him the 1% and 2% of the sales proceeds amounting to more than $10K.

We have already made an offer on the unit that the agent has helped us find, but the price was at the full valuation plus the full requested COV and an additional $2k. As we really liked the unit, we agreed to the price, but now thinking back, we begin to wonder if the agent has done his job to help us bargain. I know if we are unhappy about the agent's performance, we can let other agent represent us in the selling of our unit but we do not want to resort to that. Also we are worried about being saboed by the agent as well.

So am I stuck with giving all the 1% + 2% commission though I felt he could have done a better job?

Thanks.

Similar to engaging service of a dentist/lawyer/hairdresser, best time to negotiate on their fee is BEFORE the service is being performed not after the apartment has been identified and secured with an OTP for example.

[ryooki 0]

Similar to engaging service of a dentist/lawyer/hairdresser, best time to negotiate on their fee is BEFORE the service is being performed not after the apartment has been identified and secured with an OTP for example.

Coz we didn't think through the possible scenarios and discuss the commission payout for each scenario.

It's like you are already sitting the dentist's chair with your mouth wide open and at his/her mercy, then the dentist informs you that you have 5 cavaties instead of the 2 cavaties and hence you need to fork out extra $$ to do the fillings.. would you have thought of that happening in the beginning?

Edited January 17, 2010 by ryooki

[coldflamez 0]

it depends on whether you have signed a commission agreement with the agent. For the house that you are buying, you will probably have to pay the 1% in commission since you said that he helped you to source for the house.

To be fair, it is probably not easy to bargain for a cheaper price if there is another person who is offering for the flat also. The seller will likely just sell to the highest bidder, nothing much that your agent can do to lower the price. If there were no other bidders for the flat, then i'm not sure why you are paying beyond the requested COV.

If you are still not happy with the agent's service, then you definitely should not engage him to sell off your flat sine you have not signed an exclusive agreement with him. Let him know that you are not really satisfied and you may even be able to negotiate with him to pay 1% commission for selling as well.

[ryooki 0]

it depends on whether you have signed a commission agreement with the agent. For the house that you are buying, you will probably have to pay the 1% in commission since you said that he helped you to source for the house.

To be fair, it is probably not easy to bargain for a cheaper price if there is another person who is offering for the flat also. The seller will likely just sell to the highest bidder, nothing much that your agent can do to lower the price. If there were no other bidders for the flat, then i'm not sure why you are paying beyond the requested COV.

If you are still not happy with the agent's service, then you definitely should not engage him to sell off your flat sine you have not signed an exclusive agreement with him. Let him know that you are not really satisfied and you may even be able to negotiate with him to pay 1% commission for selling as well.

Nope, no documents have been signed. As for paying more for the requested COV, I need to rephrase.. The owner was asking for $35k COV, and later when we expressed our interest, he upped the COV by $3k. We accepted the request as we really liked the flat and we felt we probably wouldn't be able to get another flat to our liking anytime soon.

We will probably bring up the topic soon since there has been no detailed discussion on comm with the agent..

[chronograph 0]

Nope, no documents have been signed. As for paying more for the requested COV, I need to rephrase.. The owner was asking for $35k COV, and later when we expressed our interest, he upped the COV by $3k. We accepted the request as we really liked the flat and we felt we probably wouldn't be able to get another flat to our liking anytime soon.

We will probably bring up the topic soon since there has been no detailed discussion on comm with the agent..

I think your agent did a good job in finding your dream home.

The bargaining part is really tricky, it is a game of who break first. In your case, your gave in to the increase in price. Probably because the seller knew you love the house very much. I had similar experience, my family went to view a unit thrice and that signal to the seller we were very keen in buying. I offered, 3 times each time they(seller agent, didn't talk to the owner) up price so in the end I walked.

Since u are giving exclusive buy and sell to the agent, it is ok to discuss for discount. I did that as well cos my agent buy and sell for me. That was before removing the fixed rates rule kicks in. Besides, i also did not sign anything with my agent, all based on trust. Oh .... i do the bargaining only after selling and buying my house.

[ryooki 0]

I think your agent did a good job in finding your dream home.

The bargaining part is really tricky, it is a game of who break first. In your case, your gave in to the increase in price. Probably because the seller knew you love the house very much. I had similar experience, my family went to view a unit thrice and that signal to the seller we were very keen in buying. I offered, 3 times each time they(seller agent, didn't talk to the owner) up price so in the end I walked.

Since u are giving exclusive buy and sell to the agent, it is ok to discuss for discount. I did that as well cos my agent buy and sell for me. That was before removing the fixed rates rule kicks in. Besides, i also did not sign anything with my agent, all based on trust. Oh .... i do the bargaining only after selling and buying my house.

Hi Chronograph

Glad know that you managed to bargained for your agent's commission. How did your agent react when you raised up the topic on commission bargaining? Was he unhappy? And how many % did you give in the end?

[chronograph 0]

Hi Chronograph

Glad know that you managed to bargained for your agent's commission. How did your agent react when you raised up the topic on commission bargaining? Was he unhappy? And how many % did you give in the end?

My case is different from yours cos i'm totally satisfied with my agent service, why? My agent explain in detail what is expected of buying and selling, affordability, done all the paper work, ferry house viewing, provide advice of my interests, everything that u can think of. What i have done is signed the OTP, signed the check list form, that's all.

So in the end, after closing everything, i asked to nego his coms as i have given exclusive rights to him and also being a satisfied customer i didn;t ask for a huge discount. I got about 1.2k off the final bill.

[forgotten 1]

There's nothing else the buyer agent can do if he has tried bargaining with seller but the seller still die die don't want to lower the COV.

Edited January 19, 2010 by forgotten

[waileong 0]

Hi All,

When do you think is a good time to bargain on commission? Given that no documents were signed on Exclusivity as well as Commission rates. I do understand that the norm nowadays is 1% for Buyer Agent and 2% for Seller Agent. However, if the Buyer Agent is unable to secure a good price on our behalf (i.e. bargain on the COV), are we obligated to pay the 1%? We have given our word (no signed documents) that if the agent can help us source a unit, we will let him represent us on the selling of our unit. This is effectively giving him the 1% and 2% of the sales proceeds amounting to more than $10K.

We have already made an offer on the unit that the agent has helped us find, but the price was at the full valuation plus the full requested COV and an additional $2k. As we really liked the unit, we agreed to the price, but now thinking back, we begin to wonder if the agent has done his job to help us bargain. I know if we are unhappy about the agent's performance, we can let other agent represent us in the selling of our unit but we do not want to resort to that. Also we are worried about being saboed by the agent as well.

So am I stuck with giving all the 1% + 2% commission though I felt he could have done a better job?

Thanks.

Too late to bargain now, so what's your question?

[pills 6]

u rather a good agent that can sell your house at a high price and transact smoothly or have shoding work with a low comm?

[leechaorui 2]

u rather a good agent that can sell your house at a high price and transact smoothly or have shoding work with a low comm?

The problem is we do not know whether paying high comm equates to getting good agents. All agents, good and lousy claim to be good and I do not know how to differentiate them. I have used agents that ask for high comm but deliver lousy service. I have used agents that ask for little comm but deliver excellent service, so in the end, I pay the agent extra a bit to compensate him. Very hard to tell.

[ryooki 0]

u rather a good agent that can sell your house at a high price and transact smoothly or have shoding work with a low comm?

Of course everyone wants a good agent. But the thing is whether giving the 2% means getting a good agent? I am not saying that my agent is not doing a good job in selling my flat as the deed has not yet been done.

So do you mean to say that in my attempt to bargain on the commission prior to the selling of my flat will make the agent not do a good job in selling?