Thursday, July 27, 2006

Q: I am looking to buy on Vashon but I'd like to work with my Seattle real estate agent.

We've worked together on a couple of sales and I really like him. He told me that he's not familiar with the market here and with issues that might be important. He suggested a referral to someone here. I don't know how that works. I also don't know how commissions work. He said he could get part of the commission when I buy over here but I just don't get it.

A: Referrals are common in real estate. For instance, I recently had an investor who wanted to buy a small apartment building. We don't have anything like that available so I referred him to an agent I really trust on the Kitsap Peninsula. That agent found my client a good deal and I received a small part of his commission when the transaction closed.

I applaud your Seattle agent for realizing that he probably doesn't know our market well enough to properly represent you. He's also probably not knowledgeable about things like septic systems, wells and critical areas. Teaming up with a local agent familiar with all of that will be better for you.

As for the commission disbursement it commonly goes something like this: the commission is divided, often about half and half, between the listing agency and the selling agency. Then each agency pays out any referral fees due to referral companies or to other agents. Next, they often pay out franchise fees to the parent corporation (like Windermere or John L. Scott) and may also pay in a small amount to a non-profit arm of the corporation for community and charitable work.

Last, each agency pays a portion of the remaining commission to the agent that actually did the transaction. The amount of that "split" is based on company policy and is very flexible. Agencies may set the percentage of the split by number of transactions the agent has done during the year, or by years of service, educational background or other criteria.

Thursday, July 13, 2006

Q: I've tried several real estate agents here and I'm getting very frustrated.

None of them seem to be able to find me what I want. I'd like to start working with you since you come highly recommended.

A: I'm always happy to hear that folks are recommending me and ordinarily I'd be happy to try to help you. However, after our initial little talk I have to tell you that what's wrong is not that your other agents haven't been able to "find" you anything, but rather that you are unwilling to accept what is available.

Some real estate professionals do use terms like "I've found you the perfect house" and such. But let's face it, houses don't show up under a cabbage leaf to be found by the most eagle eyed agent. They show up on the Internet, on the multiple listing service or sometimes, as a "for sale by owner" ad. All of us have access to this information. The best agents make a fast connection between a new listing and a client whose needs would be met by what that listing has to offer.

On Vashon we have a very small inventory of homes to sell at all times. If you're in the lower price ranges the possibilities are even more limited. I always make sure that my clients understand that regardless of their price range they aren't going to get exactly what they want.

None of us got our dream home when we moved to Vashon Island. We settled for the best thing we could find that was affordable for us. What we got was something far more valuable than the perfect house. We got a wonderful community filled with caring people in a natural environment that is exceptional.

What has to change is your attitude. You are unrealistic and will never own your own home here unless you begin to listen to the voice of reality. Give your last agent another chance and this time, open your mind to what is really possible.