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September 28, 2018

Blast From the Past: Predicting the Trend of Lower Commissions

The evolution is not complete, but it is now evident that we were on the right track. Check out what we were publishing in 1993 (twenty-five years ago) discussing the trend of lower commissions.  

What will you do to compensate?

Commissions will continue to search for equilibrium (lower) until new value propositions can be effectively articulated by you.

Judging from the past and present, we believe that in the future, compensation structures are going to change. We feel that in the future, buyers and sellers will pay less to the licensee selling them real estate.

* Commissions are going to become more competitive: Licensees will receive less in commissions. Licensees in the securities, insurance, and some other facets of the financial services industries already receive less money in commissions than previously. Real estate, a part of the financial services industry, may soon experience the same phenomenon.

* Some real estate professionals will choose to be paid by the hour and forego any commission. As a result, they will receive pay for all for the hours that they work, therefore they will charge less. They will enter into a buyer's broker listing agreements with the understanding that they will be paid for their time whether they accomplish their ultimate goal of finding you a property or not.

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