Chatham County Real Estate Broker Eric Andrews talks about real estate commissions. What is a reasonable commission for a land or property sale in Pittsboro or Siler City?
Speaker 1: Are you the most expensive real estate agent in Chatham County?
Speaker 2: I don’t know maybe, you get what you pay for.
Speaker 1: Have you checked everybody else’s prices?
Speaker 2: So there’s no way for me to do that. I do a lot of land, and you do charge more for land. So, I just did a court ordered sale this week and it was 48,000. Okay. All everybody hears, oh, commissions are five or 6%. And first of all, commissions are completely negotiable. There’s no set thing of prices, but a lot of us remember five and six. Well, some of that goes to the buyer’s agent. Some of that goes to the listing agent. So if it’s at 6% and so that’s 3% on the listing side that’s, on 48,000, I’m less than 1500 bucks on that. Well.
Speaker 1: Kim take pictures of it.
Speaker 2: Well, I mean, seriously, I pay somebody two to 400 dollars to take pictures. I have a staff, I have SEO, I have a website, I have MLS and everything. My break even, I track my numbers, my break even is 1440. So am I going to sell something for 1500 bucks? No, I’m not, I can’t. I mean, because really, am I going to sell something for $60? No, I can’t. I can’t do it. So on stuff like that, I’m usually keeping 6% and paying out 4%. I’m doing a total of 10%. Well, 3000 bucks, I walk away with 1500 bucks now it’s, I’m making something, my photographer’s making something, my staff is making, everybody’s happy. I can do that. If I list something for two million bucks, am I going to list that for 10%? I’ll try, but I’m probably not going to get away with that.
You know? I mean, I just listed one for 6.4 million. That’d be, if I did that at 10%, I’d be a happy boy, but that’s not, that’s not how it works. And so it does get to a point where you’re like, okay, what value service am I providing? But one of the things that I really, really pride myself in, and I’m really good about showing you the numbers is I’m consistently in the top 10% of what I get for my clients. So if you have a piece of land for a hundred and you and the agent decide to list it for $120,000 and that agent charges you a 6% commission. Well, at the end of the day, after all the expenses and the commissions are paid, closing costs, you’re going to walk away with $110,000. Okay. But if you come to me and I listed at 10%, but we listed it 150,000 and I ended up selling it or let’s say I do it at 180,000 everything, and I charge you a 10% commission.
After everything said and done, you’re probably going to be walking away with $160,000. So you’re going to make $50,000 more, and when I look at the sales stats for 2021, I can see that this many properties have sold in Silk Hope. Eric Andrews is the top 10% every time, or this many this is like the most price per acre that someone’s ever gotten in Bonlee. I mean, I did that this year. Well, that’s not hard to do cause we, if we compare 2021 to 2022 prices have gone up, but I’m talking about when stuff is selling at the same time in the same neighborhood or when somebody’s selling the same acreage in the same six mile radius, I am consistently getting my clients more than what other agents get.
The downside of that is there’s been a bunch of properties that have sold in two or three days, multiple offer, and it sells quick. My days on the market are longer. I’m known as being aggressive as far as the prices I get for my clients. I want my clients to walk away with the most reward. So goodness gracious, some of my residentials on the market for three to six weeks or some of my land is on the market for three to five months or whatever. Well, so yeah, I have more days on the market, but my sellers are walking away with more. So one of the crafts things I’ve said to my sellers before is you probably shouldn’t be as concerned as much as what I’m making on the deal is how much you’re making on the deal. And if I can provide you more of a return or greater reward, then I think I’m worth it.
I’m not, I don’t think I’m super high on the commission scales anymore. I do think because there is a tremendous shortage of inventory that there’s a bunch of agents out there that are really, really aggressive and they will do it for a lower amount. But you want somebody that’s a strong negotiator, that knows the market, that knows what’s realistic, because then you can have another agent that charges you 2% and lists it double. Well, then it sits there and doesn’t sell period. And that doesn’t have a value to you. So you need somebody that knows the market. I thrive on making my sellers the most money possible. So many times, I mean, 81 sales this year, at least a couple double dozen times the neighbor said, oh, you’ll never get that. And we got it every time. So I’m real happy with what my sellers have walked away with in 2021.
