Negotiating tactics

D - Buyer Tactic: What if they deduct the commission from their offer?

                COMMISSION OVERVIEW

Some buyers negotiate with the belief that a by-owner isn't paying a commission so they subtract this fee from their offer.

This argument can be refuted by explaining that low commissions are the norm in the area and how you priced the house lower to sell faster-something that will benefit them.

Knocking off the commission:

Some homebuyers assume that you’ll have to pay a 6 percent commission if you were listed with an agent and weren’t selling by-owner. So they reduce their offer by this much. Or they reduce it even more by making an offer several percentage points off your asking price and also deducting an amount equal to a commission.

It’s helpful to know if they based their offer on this. If they didn’t say or didn’t imply it, ask them how they arrived at their offering price. “In going over your offer, we were just wondering how you arrived at the price?”

If they admit that they reduced their offer because you are selling by-owner, they’ll let you know. It’s their way of justifying their lower offer.

Commission savings are a myth:

If they don't specify a specific commission figure, ask them how much they think a real estate commission is. Whatever their answer is, tell them that you’ve talked to Realtors and their commission is only “X” (a rate that is obviously below the figure they provided). Let them know that you've heard that other real estate agents offer even lower commissions or that you could use a low cost internet site, such as those listed in the ADVERTISING step, that gets listed on the MLS for even less.

This approach works to discourage the buyers, while letting them know you’ve done your homework.

Point out how you’ve been doing the marketing of the home yourself; the functions of the listing agent, in order to not have to pay the "listing side" of the commission.
 
If you have correctly priced your home close to the expected selling price, advise the buyers that you have priced your home below the real estate agent’s recommended asking price in order to get a faster sale.

How can they argue against this? After all, they are the ones interested in your home. They obviously see value in your home, which is tied directly to your asking price. They probably knew the asking price before they even saw your home. Tell them that you wanted to make it more attractively priced than you would have been able to if it were listed. This is a benefit to them.

                                THE PRICE IS RIGHT

If you are confident that you’re offering a good deal at the start, you’ll attract buyers and you won’t have to move very far off of your asking price.