Why not tip a realtor showing homes?

[debbieburton]

Hi,

With the changing world, times and technology people that provide a service should get a tip. Even realtors.

With today's technology there just isn't loyalty like there was in the past years. Even in the 80's when someone provided a service people felt an obligation to purchase something from them or give them something for their time. In the past if a realtor specialized in a neighborhood giving information to a homeowner for years, that homeowner felt an obligation to use that realtor.

Today's world not even a referral is sufficient. In most cases the referral has a friend or family member already with a real estate license and they end up using them, but think nothing about using a realtors time. A realtor is expected to work 24/7, return calls at any time and where ever they're at. A realtor is expected to show homes at anytime, even if it's a holiday and they have to cancel a family function and then more than likely never see that homebuyer again. Most realtors don't even mind living that way, but should be at least compensated for their time. That's the life of many realtors. Show 5-10 homebuyers homes in a week and never see even 1 ever again.

People can get information so freely, the public discriminates for whatever reason (a realtor can't,) they feel their personalities aren't compatible or their beliefs are different and they're on to the next realtor. If a person provides a service, what does a person's personality got to do with it? I may not like my waitresses personality, but I still give her a tip.

Many homebuyers call up a realtor, have the realtor show them houses all day deciding for whatever reason they'll never see that realtor again. What makes a complete stranger think they can get in a realtors car, have the realtor spend a half a day to an entire day showing them houses and the homebuyer doesn't have to give them a cent?

Realtors provide a service and the belief or proper etiquette to give a realtor a referral instead of a tip after spending hours of a realtors time and gas isn't sufficient. With almost everyone having a real estate license, a referral in most cases will never happen. The belief most realtors are rich isn't even true. There are so many licensed realtors and at least half of their income goes towards advertisement. So many realtors never even sale a home and don't even have enough money to pay bills, put food on the table or even pay their taxes. A person gets their real estate license thinking they like working with people, make their own hours and then spend their life savings advertising themselves. Many realtors each year get out of the business because they no longer have money and didn't even sell a home.

If homebuyers get in a realtor's car and in their mind never plan to use that realtor, should give a tip to a realtor. If it's not proper etiquette to tip a realtor than proper etiquette should be made clear to the public and especially to so many people coming to this county.

Realtors are treated like to dirt. I just can't believe people writing these etiquette books suggesting not to tip a realtor. We're just suppose to just freely spend our money on people trying to find them a home and they never use us.

Keep in mind with all these foreigners coming to this country may never even read a proper etiquette book. Many believe realtors get an hourly wage to show homes. Many think everyday we're showing homes and selling them. The public just doesn't understand what it realky is like to be a realtor. Even $5.00 as a tip would make a difference.

The public needs to keep in mind we are human, have families and need money to pay our bills too. That's what's so great about open houses. If you don't plan to use the realtor, tip them or just go from open house to open house until you find the realtor you want to use and do use them.

Thanks,
Debbie

[jamesglewisf]

Yikes, I got two emails and this posted here. Here was my response to the email:

If you don't like your compensation arrangement as a realtor, then you should come up with a different arrangement. You don't have to show someone homes all day for free. Have them pay you up front. If you can't get them to pay you up front, then do something else. You live in the United States of America. If you don't like your job, then find a new one. Don't just gripe about it.

I have many friends who are in real estate. The good ones earn every penny they make, and they earn plenty of them. The bad ones end up doing something else. If you aren't good at sales, then you should find a new profession.

[jamesglewisf]

More of the never-ending saga... Here is the email I got:
You state:

Realtors® or real estate agents - Nothing. The best way to say thanks is to refer people to them.

Realtors provide a service and should be given a tip when a homebuyer is leaving a car. If a realtor shows a couple 5 to 10 homes in a day and they don't like the homes it's got nothing to do with a realtor being a good salesperson or not. We can't force them to buy a home.

Just because you say don't pay anything as a tip to a realtor, I disagree.

I've sold many homes and I see many realtors come and go. We have too many realtors because they believe they'll make a minimum of $75,000 a year without doing much. If the public knew the real truth what the majority of realtors go through and pay for advertisement they wouldn't be so eager to get their real estate license.

If a friend gets in someone's car they offer gas money. If a homebuyer gets in a realtors car why shouldn't they pay a tip, especially when they know they'll never see or talk to that realtor again?

Here is my answer:

You shouldn't get tips because that is not how you are compensated. You are compensated by a percentage of the home price. Again, if you don't like it, then have people pay you by the hour to show them homes. You are not a slave. They don't hold you at gunpoint as you drive them around. If you don't like it, then change your method of compensation or do something else.

By your logic a car salesmen should be tipped if someone comes in and doesn’t end up buying a car. That's just not how it works. A car salesman and a realtor get paid based upon how many units they sell. If you can't earn enough on the ones that are sold to make up for the ones that don't buy, then you should switch occupations or you should work for a real estate firm that pays you a salary instead of a commission.

I own an insurance company, and our brokers are paid by commission. They don't get tips from people whom they visit who don't buy a policy. They don't sell policies to everyone. If they need 30 sales in a month to make the kind of income they want, but they only sell to 50% of the people they visit, then they better visit 60 people. They can't just sit around griping that the other 30 should give them a gratuity in exchange for not buying anything.

Basically, it sounds like you are not made for commission sales. I would find another occupation because what you are complaining about is the whole concept of commission compensation.

[jamesglewisf]

The reason you are paid by commission is it is an incentive for you to be good at your job. The better you are at your job, the more homes you will sell. Based upon the price of the homes and how many you sell, the more you will make. If you are really good at sales and marketing yourself, then you can make a ton of money in a commission-only job. But you won't do it if you are sitting around griping about how you are compensated. You have to get out there and be good at what you do.

One of my long-term friends is a real estate agent. He helped me buy both of my homes. I recommended him to my friends. He helped them find homes they wanted. They recommended him to their friends, and he sold even more homes. The more people he serves well, the more people recommend him to others. Does he sell a home to every one of them? No. But he sells a ton of homes and makes very good money.

I used to sell computers on a commission-only basis. Was it frustrating to educate a consumer about computers and have them go down the street to buy the computer from someone else? Yes, but that didn't slow me down. The only person in the store that sold more computers than I did was the owner. I outworked and outsold everyone else in the company. If I didn't get a sale, I learned from it and worked harder to get the next one. I didn't sit around griping about the people who didn't buy from me.

You know the reason why commissions work? I sold about 40% of all the computer equipment in the store. The harder I worked, the more money I made. If I was just paid a flat salary, then I wouldn't have had as much motiviation to get out there and work harder for sales than the schleps I worked with.

[Justawoman]

Very well put Jim. Sales is a job I would not want at all. They clearly tell you up front you better be a good salesperson if you want to make money. I wouldn't have a problem paying a small fee up front to a realtor showing me a house. They could very well incorporate this into their job. Be more like a lawyer, the initial visit is free then you start paying as we go. I wouldn't have a problem with that either.

[terindale]

If you want to sell a home fast and get a bigger commission, why don't you 'Google' Home Staging and research the topic?
Homes already have to look good for a potential buyer, why not take a Staging class and find out how to Stage a home so that home can look it's best and fetch top dollar?

[CuriousG]

If you tipped a real estate agent for showing a home, then why wouldn't you tip a car salesman or a furniture salesman, etc. That's just part of the job. A good salesperson makes money by selling their product, not by going through the motions. Personally, I like dealing directly with the homeowner. I wouldn't be surprised if real estate agents were a thing of the past in 10 years or so. What does a real estate agent really do? They put sellers in contact with buyers, usually through adverstising and people signing with an agent to do the work for them. In my opinion, real estate agents are a convenience for those who don't have the time, knowledge, motivation to do it themselves, and they are compensated (usually pretty well) for making that process as easy and efficient as possible by making sales.