When/How is the best way to mention a buyer agent rebate?

[kyle]

What's the best way you can go about mentioning or suggesting that your firm allows buyer agent rebates while still maintaining a sense of credibility and trust with the client?

[aslan]

Kyle, first of all I would check with your managing broker to see if your firm allows rebates or discounting of commissions. I'd say most real estate firms will either have written policies against rebates and this sort of thing, or at least require manager approval to work for less. I believe some firms will even require manager approval for discounting from 6% to 5% all in on the sell side.

If you work for a discount broker, then you probably don't need to mention it as it'll be all over your company's website and branding, so pretty self explanatory and you can mention it at any stage, even at the beginning since that's your company's identity.

If you work for a traditional broker who does allow discreet friends and family deals, then it's more nuanced. Traditional brokers will obviously never willingly tell the world that they're willing to work for less. Doing so undercuts the rest of their business. Most brokers get new clients through doing a good job and getting referrals as a result. If a referral comes in with the assumption of a normal commission, why would they want to undercut that?

However, it gets interesting if a traditional broker allows its agents to discreetly offer rebates and discounts. If you're a lucky agent at a firm that's more flexible like this, then you can offer it when you feel like the customer will need more of an incentive to work with you.

For example, if you're speaking with a potential buyer and they say that they've just started looking. Try to connect with them on a personal level first and see how you can help them. Perhaps you can give them some advice on how the home buying process in NYC works or what closing costs are. Offer to help send them some listings and organize an open house tour for them. Explain to them that the services of a buyer's agent are free. For most buyers, this is good enough and that's why 90% of all buyers do end up being represented by buyer's agents in NYC.

However, if you feel like this is not enough and you're not getting positive feedback from the buyer on the idea of working with you, then you should offer a buyer's agent commission rebate as an incentive for them to stick with you.

Again, this is just my opinion and you should test what works for you. But my gut feeling is most agents will want to try just converting a potential buyer the old fashioned way first and take full commission. And only offer the rebate if they feel like the buyer is not interested in really working with them or having a buyer's agent at all.