Coached to Discount: Why a Cheaper Commission Can Cost You More

If you’re on Facebook, you’ve probably seen them. The real estate coach. Big smile, bigger claims, and an ad in my feed almost every day. They do a lot of deals, and they’ll sell you thousands of dollars’ worth of coaching for about fifty bucks.

I recently got to see that coaching in action. It was a good lesson in what a discount really buys you.

The Setup

I was representing a buyer on a recent purchase. Along the way, I learned the listing team had taken the listing at a huge discount and paid for staging themselves.

So the high deal count started to make sense. When you’re the cheapest option, people sign with you. But it made me wonder: if you discount yourself to win the listing, is that what you teach your students? And if your coaching is so valuable, why are you practically giving it away?

Then the seller countered my commission lower. I accepted. I’m a team player, and I wanted my buyer to get the house. Remember that part. It comes up again.

My buyer noticed something I hadn’t. She looked at the flyer and said, “Why are there more pictures of the agents than the house?” To be fair, a flyer markets the agent as well as the home. Every agent puts her name and face on it. But when the team gets more photos than the kitchen, you know who the star of the show is.

The Negotiation

The inspection turned up roughly $20,000 in repairs. That’s normal, and it’s exactly when a listing agent earns her money. She can work with the seller on a price adjustment, repair credits, fixing items before close, or some combination.

What did the coach offer? She would credit my buyer $2,500 out of her commission if I credited the same amount out of mine.

That was her big move: have the Realtors pay. Again. I’d already taken less to keep this deal together, and now she wanted me to take less a second time.

I said I’d consider it if the seller made it worth my while. Then I brought it to my buyer, and she shut it down right away: “I don’t want the Realtors paying. It should be the seller.”

That’s a smart client. She understood that the house needed roughly $20,000 in work, and the person who owns the house should be part of that conversation.

How It Ended

To be fair, the seller wasn’t easy to work with. But a good listing agent finds options even with a tough client. The only option on the table was agents giving up pay, and the seller never moved. So my buyer walked away.

A week later, the home is still on the market. Every extra day costs that seller money: mortgage, taxes, utilities, and the risk of the next buyer finding the same repair list.

Meanwhile, my buyer and I are still out looking, and I’m happy to keep going until we find the right one.

The Real Lesson

Would I have gotten that listing? Probably not. A seller shopping for the cheapest commission likely wouldn’t have hired me. But if they had listened, I would have shown them how to protect the bottom line in this market: pricing it right, prepping for inspection issues, and negotiating repairs without losing the buyer. That would have saved her far more than a lower commission, holding costs for one.

An agent who’ll cut her own pay to get the deal will often cut corners to close it. An agent who’s comfortable negotiating will fight for your money.

So when you’re hiring a Realtor, don’t just ask, “What’s your commission?” Ask, “How do you negotiate when things get tough?” That answer will save you more than any discount.

Thinking about buying or selling? I’ve been negotiating for my clients for over 20 years, and I don’t back down when things get tough. Let’s talk about how to protect your bottom line.

Melissa Case
Realtor, Better Homes and Gardens Real Estate Reliance Partners
DRE #01380570
(925) 382-5222
Serving the Bay Area, from Oakley to Oakland