Is it true that if the commission is too low a buyers agent won't show your house to their clients?

Question

I talked to a real estate agent and they said they could do it for 3.9% total commission (buyer and listing). I've also never heard of the company but a friend of my husband told him about them. They also say they do a lot of marketing for their houses but when we bought I never saw any ads for them. So I was just wondering what was fact and fiction.

Answer 1

From what I understand thats true.  Think about it.  If you were a buyer's agent and most houses are paying you 3% would you want to spend your time with one paying 2%.  

That said though, alot of discount brokers still pay a normal commission to the buyer's agent, but the sellers agent gets a lower commission.  Also, if the buyer themself finds your listing on a website or something, they can probably make the agent take them to it and the agent will get what they get in terms of commission whether they really like it or not.  

Another reason buyers agents don't like non-traditional sellers agents is that they sometimes have to guide both parties through the closing process.  Thats more for FSBO situations though.  

Answer 2

This would be true.

Would you not only work with a 33% pay cut, but work more?  

They are not stupid, they know it is one of those "limited service" listings, which means the agents has to do all of the work, not just half.

As a buyer I do not expect or want my broker showing me property he will not be properly paid for.   There are plenty of other properties.  

I also worry about someone who will want to cheat the agents like that,

if they are too cheap to pay for decent service were they also too cheap to take proper care of their house?   The odds are they cut corners with the house too.

Answer 3

There is probably a reason you've never heard of this company.  Cut rate real estate companies are like mushrooms, they pop up and then they rot away.