A few weeks back on Facebook I was part of a thread where folks were discussing Realtor fees, and if in fact Realtors charge too much money. There was one agent who said he worked an average of 25 hours per deal, and got paid an average of $10K per deal, and was therefore making $400 an hour, and that he felt he was being paid too much, and eventually consumers would wise up and start paying less to Realtors.
I thought that was a pretty interesting observation coming from a Realtor, but let’s get real: there are many Realtors who add little value to the transaction, who are in fact overpaid. Could be you’re overpaying your Realtor if you even pay them $1 – because in some cases, Realtors destroy value, they don’t create or add it.
But that is rare. I think the better question is not how much is your Realtor making per hour, but rather, how much would you have made on the sale of your house, without your Realtor’s involvement?
Let’s say you pay your Realtor $10K – call it $20K, because you’re probably also paying the buyer’s agent’s commission. So you’re paying $20K, but if you had not used a Realtor – would you have made $20K less on the sale? In most cases, I think not only would you have made $20K less, you’d make $30K less, $40K less.
It’s not how many hours your Realtor work that counts. What counts is the result they bring, compared to them not being involved at all, or selecting another Realtor for the job. Because it’s quite possible that your Realtor could earn their keep in 1 hour, or 10 – it’s very possible to deliver astounding amounts of value in a short period of time. The right advice, at the right time, properly applied, can and often does make all the difference in the world, and can pay many multiples over the cost of that advice, even if given in a short period of time.