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When selecting an agent, many vendors focus heavily on the commission rate. It can be tempting to go with the lowest fee on the table, assuming it will save money. However, this decision can often end up costing far more than it saves, writes Adrian Bo, CEO of Adrian Bo Real Estate Training & Auctions.
The first negotiation an agent ever undertakes on your behalf is, in fact, with their own income. If an agent drops their commission from 2.5 per cent to 1.5 per cent in a single conversation, it sends a clear message about how they approach negotiation. If they quickly discount their own value, how will they handle a buyer pressing for a lower purchase price?
The true cost of weak negotiation
An agent’s ability to defend their own fee reflects directly on their ability to protect your sale price. If they cannot stand firm on something as personal as their own commission, there is a risk they will just as easily encourage you to accept an offer below market value. Even a small percentage drop in sale price can far outweigh any savings you thought you were making on commission.
For example, on a $1 million property, negotiating an additional $20,000 on the sale price delivers a far greater return than saving 0.5 per cent in commission. The skill to achieve that higher result lies in an agent’s negotiation strength, not in the size of their discount.
What to look for instead
Rather than focusing solely on the cheapest option, seek an agent who offers:
- Competitive and sustainable fees that reflect the value they bring to the transaction.
- An impervious process that has been refined through consistent, proven success.
- A track record of negotiation strength backed by results, not promises.
Value over cost
The right agent should be seen as an investment, not an expense. Owners should look for someone who can justify their fee through exceptional service, superior negotiation, and a clear ability to achieve the best possible outcome.
Choosing the cheapest agent might save you a small amount on commission, but if it comes at the expense of your sale price, it will likely be the most expensive decision you make.
Adrian Bo is the CEO of Adrian Bo Real Estate Training & Auctions.
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