What if we charged by the hour?

I was talking to some agents recently about all the things that an agent does for her client, and how she does them “on spec.” No matter how many times she shows that listing, or does open houses, or advertises the property, she makes nothing if it doesn’t sell. And no matter how many time she takes out a client and shows house after house after house, she makes nothing if that client doesn’t buy.

Very few other professionals work like that. They get paid by the hour. So why shouldn’t we? A set fee for the buyer for all the work we do, which would include previewing and researching and everything else. That’s how other professionals get paid. Would you be willing to do that? And wouldn’t it be nice to take the pressure off — to get paid regardless of whether the buyer buys or the seller sells?

It’s almost a relief to even think about it, to think about all the people who devalue our services by claiming that we’re overpaid, and whether they’d be willing to put their money where their mouth is by paying us a reasonable hourly rate for the work they want us to do — whether they buy or not.

The question becomes how much we would want to charge per hour, and how much we could charge. Attorneys in our area charge $300-500 per hour for hourly work. For their real estate work, they charge between $500 and $1,200 for residential closings, probably for something between two and five hours work. Other professionals in the real estate industry, stagers and home decorators, charge between $150 and $300 an hour (decorators also get a piece of the purchases). So given all that, what’s the value of real estate services?

Another way to look at it is how much you’d need to charge to make around the same income for a successful transaction. How many hours do you work with your average buyer and seller? And what’s your average side? That’s your current hourly rate. Could you charge that?

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