Liz & Todd - Fort Lauderdale Realtors

13 hours ago

To REALTORS who GENUINELY don’t understand why compensation is not 50/50 split…

I’ll take the time to explain.

The question posed in this screenshot begins with a critical false assumption:

Where did you learn that a 50/50 commission split was “STANDARD”?

Whoever teaches this is doing you, and our industry, a tremendous disservice. After everything our profession has just gone through, I’m amazed agents are still publicly talking about commissions as though there is a “standard” rate or a predetermined formula for dividing compensation.

There is NO standard commission.
There is NO standard 50/50 split. Compensation is negotiable.

That distinction is at the heart of what agents should have learned from the commission litigation.

A listing broker negotiates compensation with the SELLER for the services the listing brokerage provides.

A buyer broker negotiates compensation with the BUYER for the services the buyer brokerage provides.

Two different clients. Two different agreements. Two different scopes of work. Two different negotiations.

So why would the compensation automatically have to be equal?

It doesn’t.

If a listing brokerage negotiates 4% for its services and the seller authorizes 2.5% toward buyer-broker compensation, what exactly makes that inherently improper?

Nothing.

And the reverse could also occur. A buyer broker could negotiate compensation greater than the listing broker’s compensation.

The point isn’t who gets more. The point is that it is NEGOTIATED.

A listing agent may spend substantial money and time acquiring and servicing a listing photography, video, advertising, open houses, staff, technology, prospecting and marketing with no guarantee the property will ever close.

A buyer’s agent can likewise provide tremendous value searching, showing, researching, advising, negotiating, coordinating inspections and financing, solving problems and getting the transaction to closing.

Both can be extremely valuable without being entitled to identical compensation.

And “cooperating broker” does NOT mean “equal partner in whatever commission the listing broker negotiated.”

That’s the fundamental misconception.

Under today’s rules, buyer agents should be establishing their compensation with their buyers through their written buyer agreements. If you believe your services are worth 3%, 3.5%, a flat fee or something else, GREAT.

Demonstrate your value. Negotiate it. Put it in your agreement.

What you DON’T do is look at what another broker negotiated with her client and conclude that half of it automatically belongs to you.

The seller may absolutely choose to contribute toward buyer-broker compensation. In many transactions I believe doing so is an excellent strategy because it can reduce a buyer’s cash burden and broaden the property’s potential buyer pool.

But there’s an enormous difference between:

“Offering buyer-broker compensation may benefit my seller.”

and

“The buyer’s agent is entitled to half because 50/50 is standard.”

The first is professional advice and negotiation.

The second perpetuates precisely the mentality our industry should have abandoned.

Agents need to stop saying:

“6% is standard.”
“3% is standard.”
“50/50 is standard.”
“The buyer’s agent gets half.”

No.

Broker compensation is not set by law and is fully negotiable.

If your broker or trainer taught you otherwise, I would seriously question that training, particularly after the commission litigation and resulting practice changes.

The lawsuits weren’t about listing agents getting 3.5% while buyer agents got 2.5%. They challenged practices surrounding cooperative compensation and competition. The resulting changes reinforced something agents should have understood all along:

Consumers negotiate compensation. Brokers negotiate compensation. Value is negotiated.

So the question isn’t:

“When did 50/50 stop being standard?”

The better question is:

Why were you ever taught that it was? ... See MoreSee Less

Liz & Todd - Fort Lauderdale Realtors

3 days ago

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MÁS INFORMACIÓN:
www.CoolOpenHouse.com ... See MoreSee Less

Liz & Todd - Fort Lauderdale Realtors is in Hollywood Beach, Florida.

3 days ago

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Liz Dawes-Ordoñez
Dawes Team | eXp Realty
Fort Lauderdale • Hollywood Beach • South Florida

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