Are You Over-Paying Your Buyer’s Agent?

Why do top teams pay a Buyer's Agent the same for a buyer web lead as a seller from your listing who needs to buy a new home?

Are you overpaying your Buyer's Agent? See below.

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Are You Overpaying Your Buyer's Agent?

I have seen almost ALL top teams with a crazy compensation model which makes no sense to me. Let's say they are paying Buyer's Agent on a 50/50 split. If a Buyer's Agent makes 200 dials on the phone over the course of 9 months to close a single buyer web lead, they are paid 50%.

If a Buyer's Agent makes close to 0 dials on the phone and is given a Move-Up Buyer from your team's Seller/Listing who is ready to go, and likely a higher-priced buyer, they are paid 50%.

Does this make sense to you? If not, then why is almost everyone in industry running their business with that model? Crazy....

Client Case Studies - Quick Tips

Here are some quick tips based on recent client calls or meetings: 

·  Allowing Agent to do Listings at 50%: The worst possible team model is where you allow the Buyer's Agent to also do listings and you pay them the same 50% split. This is not so much a team, it is closer to a brokerage. Remember, a brokerage is a terrible business to be in - usually. A team is better. A Billion Dollar Agent is the best.

·  Slow Sally: A Slow Sally is someone who does not get much of anything done. This applies to probably 50% of real estate agents or more. For example, if you analyze all of the agents in a typical Keller Williams Market Center, you will find there are 50 or more agents who SAY they work full-time and they only close 5 or fewer deals per yearThe numbers do not add up. They are barely working 5 hours a week to close 5 deals per year. This is a Slow Sally.

Sometimes, a team leader will hire a Slow Sally as a Buyer's Agent. They get snowed during the interview with the Buyer's Agent because the agent may appear to be outgoing, friendly, great with people, interviews well and more. But, they simply do not work. They spend their working hours on Facebook, Twitter, phone with family and friends, continual life crises, and chatting with the other Slow Sally's in the office. Do you have any Slow Sally on your team or in your brokerage?

Interestingly, in the Keller Williams model, they actually want to have 25-50% of the Market Center be a bunch of Slow Sally's. This creates the positive warm 'culture' which then attracts other agents who actually produce.

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Comment balloon 2 commentsSteve Kantor • November 03 2014 03:58AM


So why are you picking on Keller Williams? Do you need to single out a particular brokerage company to make your point? I think buyer agents do get paid too much but I don't believe this is limited to KW. 

Posted by Lise Howe, Assoc. Broker and Attorney Licensed in DC, MD, VA, (Keller Williams Capital Properties) over 4 years ago

Sorry, didn't mean to pick on Keller Williams, and I'm sure you're right--it's not just something KW does.

Posted by Steve Kantor, Best Agent Business - Virtual Assistance (BEST AGENT BUSINESS) over 4 years ago