Page 263 - Trump University Commercial Real Estate 101

The Right W a y to Sell for Maximum Profit

commission on properties she gave me? Focus on that all - important
relationship with the broker.
I just told you not to be cheap. Here ’ s how brokers sometimes get
greedy: Some will tell you that you must pay a six - percent commission
when a four - percent one is warranted. They ’ ll justify it by saying:
“ Four percent is too low; nobody in this city will cobroker this deal for
a four-percent split. ”
What the broker just told you is that he doesn ’ t believe he can sell
it on his own. He ’ s going to rely on his competition to bring their
buyers to the table, too. You do not want this broker.

The Listing Agreement

You ’ ve chosen the winning broker and now it ’ s time to sign the listing
agreement. It will spell out how long the agreement will be active,
what type of agency the agreement is, what duties the listing broker
will perform, and the amount of the listing commission.

Term

The general term of a listing agreement is 180 days. Some will try to
get you to sign for a year. Don ’ t do it. If you do, you ’ ve just put your-
self into a position of weakness. If the broker doesn ’ t perform, you will
be at the mercy of the brokerage agency to release you from the listing
so that you can find someone else to sell it for you.

Sometimes you can get a 90 - day agreement, but it ’ s rare. If you do
get a 90 - day one, you can be sure the broker will be very aggressive
about selling that property within such a short window.
There is some validity to the argument that 90 days is too short,
because the broker will not have enough time to market the property
effectively. Brokers hesitate about spending lots of money on market-
ing only to have the agreement expire when things were getting good.
Shorter is not necessarily better.

243

10/14/08 11:31:47 AM
c12.indd 243
c12.indd 243 10/14/08 11:31:47 AM