The Light Dawns

Sniffing around the edges of the so called “3rd party relocation” business there appears to be a belated recognition on the part of those providers that getting greedy with referral fees is costing them.  Of course the relocation business is in as much disarray as the rest of the real estate industry.  Many relocation service providers got caught short paying top dollar for employee home purchases as the local market declined.  Part of the root of that problem was the relocation companies asking for as much as 40% for a referral fee.  By the time the participating real estate brokerage recovered its cost of obtaining and maintaining the business, the average fee paid to the Realtor® was 30% to 35% of the total cooperative commission. Many productive and experienced Realtors® do not want to work for that level of compensation, so the referrals have been going to the brokerages less experienced sales associates.  20 years ago, relocation business generally was referred to a select group of well trained and experienced sales associates.  Quality control was tight, and transferring employees were well informed about the buying opportunities, knowing the sale was not that far away.  Let’s face it, experience shows, and experience expects to be justly compensated for that experience.

That 20 year comment I just made in the preceding paragraph is popping up all of the time lately.  It seems as if the entire real estate industry is stabilizing around the business operating principles of 20 years ago. You know, well trained people, experienced management, long view ownership, ETHICS!, things like that.

Written by Larry D. McGee, Denver Realtor - Visit Website Sphere: Related Content