Why is it the real estate agent always gets blamed? It's not that we don't want to take responsibility if we make a mistake or if we're wrong, but being the fall guy, the patsy, or the person that finger's pointed at gets tiresome.
I've noticed this particularly as the market has changed. When there were more St. Paul buyers than houses and the only way to win in a multiple offer was to be the top bidder, the real estate agent was blamed for suggesting a higher price. Since the agent's commission is based on a percentage of the purchase price of the home, the agent's suggested higher price was sometimes attributed to greed. Afterall, the agent really only wanted the bigger paycheck!
Doing the math often disproves this motive. Commissions are always negotiable, but for example purposes only, let's suppose the commission for the buyer's St. Paul real estate company is 2.7% of the purchase price. On a $200,000 purchase, the buyer's real estate company would receive $5,400 to be split with the agent. If the agent suggested increasing the purchase price to $210,000, the new commission amount would be $5,670, a difference of only $270 of which the agent may only be getting half! An increase that small doesn't motivate most agents. What does motivate them is getting the house that the buyer wants (and by implication, then getting paid!).
The irony is that now agents are suggesting that St. Paul sellers and buyers lower their prices. Has the public given any thought to the fact that agents are now suggesting a price that will decrease their commission check as well? Most have not. The price reductions are far out stripping the increases of before. The price reduction is hitting the real estate agent's pocketbook as drastically as it is the St. Paul sellers. Whether we like it or not, we're all suffering the same consequences with this new market!
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