Buyer Agent Bonuses and Other Mistakes

Yes I've accepted them in the past. No, I can't accept them in the future. Why? Well you have to ask, who am I representing? I'm representing Buyers. If a Seller is paying me a bonus, what is he paying a bonus for? In other words, what's his motivation? And if its OK to accept a small bonus, when is that bonus too big? I wrote this post about a $50,000 Buyer Agent bonus last month that just put me over the edge. Then the article in today's Observer. Thought they could be abused, and they were.

Now let me point out right away I have never sold a home because of a bonus. I never wanted to hear a customer say you sold me this home because of the bonus. In almost every case I disclosed the bonus. But not every case. And it did adjust the playing field once-- a Centex home with a 10K bonus worked its way onto the View list. I remember selecting it for the View list along with about 10 others, out of 30 or so...

The buyers bought this house, not at my suggestion, but inspite of a lot of things. The bonus was nice, I could justify it because Centex dropped the price to my buyer by 35K or so-- but still, how much do my customers have to pay for my services?
And they did pay for the enire commision, within the sales price of the home, didn't they? Anyone doubt I could have negotiated a 10k price reduction giving up the bonus?

So- if there is a Buyer Agent Bonus what will we do? Pay it to our buyers, either in reduced sales price or rebate. There can be no other answer- because even a small bonus may distort the playing field.

We either represent the Buyer's interests alone, or we represent someone else. I choose the Buyer.