P:604-767-1583 E:mdee@sutton.com

Seller's Price Protection

In his doumentary Freakonomics, Stephen Levitt points out that a listing agent's incentives may not be aligned with the seller. In a fixed commission structure, such as 7% on the first 100k and 2.5% on the balance, it is true that the agent doesn't have nearly as much to lose from a price reduction as the seller.

That being said, I never pressure my clients to accept an offer that they are not happy with. But just for good measure, my clients have a more reassuring alternative. Seller's Price Protection is an optional commission structure that realigns the listing agent's incentives with the sellers. It's not just a smile and promise, it is written into the listing contract. If the sale price is lower than the target sale price (which is agreed upon by the agent and the seller), the listing agent's commission is used to cover a portion of the difference. The exact portion will depend on the list price and market conditions.

The buyer's agent commission always remains intact to ensure maximum market exposure. There is absolutely no risk to the seller as the commssion structure never exceeds 7% on the first 100k and 2.5% on the balance. This option may or may not be available with other offers.

Take the first step towards selling your home and request a free consultation today.

Have Questions? Contact me at: 604-767-1583

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