{"id":30488,"date":"2021-02-04T10:19:55","date_gmt":"2021-02-03T21:19:55","guid":{"rendered":"https:\/\/propertynoise.co.nz\/au\/?p=30488"},"modified":"2021-02-04T10:19:55","modified_gmt":"2021-02-03T21:19:55","slug":"real-estate-commissions-to-get-high-house-sale-prices-unethical","status":"publish","type":"post","link":"https:\/\/propertynoise.co.nz\/au\/real-estate-commissions-to-get-high-house-sale-prices-unethical\/","title":{"rendered":"Real estate commissions to get high house sale prices \u2018unethical\u2019"},"content":{"rendered":"

PHOTO: Your real estate may not have your best interests at heart if they\u2019re thinking of their next big payday. Source: istock<\/em><\/span><\/strong><\/p>\n

A little known \u201cunethical conflict of interest\u201d for real estate agents can often see them selling us short so they can get their money quicker.<\/p>\n

COMMENT<\/strong><\/p>\n

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In this post-pandemic world of surprisingly buoyant property prices, few people understand the unethical conflict of interest between real estate agents and vendors.<\/p>\n

This conflict of interest is created by the current structure of traditional percentage based commissions and has ethical implications for the $6 billion real estate sales industry.<\/p>\n

For generations we\u2019ve been conditioned to believe that a commission incentivises real estate agents to achieve the highest possible sale price.<\/p>\n

This was based on the belief that the higher the sale price, the more the agent is paid.<\/p>\n

There is a fundamental problem with this belief because it hides the real incentive that a percentage-based commission creates for real estate agents and agencies.<\/p>\n

Assume that you are selling your home with an agency that charged a commission of 2.5 per cent. That real estate agency would only lose $250 for every $10,000 reduction they convinced you to accept.<\/p>\n

Why would an agency convince you to sell for $10,000 less (and in many cases, much less)? Simple. To secure a quicker sale and collect their $20,000 commission sooner.<\/p>\n<\/div>\n

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