The commission is expensive!

What is a commission? The definition I like best is that a commission is a charge, that is, it is a liability assumed for the purpose of serving us or serving others and has specific goals. It is something due if you agree to carry out a mission that you will have to fulfill and effectively fulfill well. Today, unfortunately, we pay a lot of commissions without realizing the purpose of what they are really serving. For example, bank commissions, I confess that I do not know if are expensive or cheap, because I can’t understand what they are for, and this is possibly where it resides the essence of value perception, and which we define whether the commission we are being charged is expensive or cheap. In Portugal, and in particular in the real estate activity, commission is a recurring theme. Sometimes, some mediators substitute the term commission for fees, however, mediation companies and their agents only get paid if the transaction is completed, which is why the term commission is well applied.There is a mission, a focus and a single objective that, if achieved, is due through the payment of a previously agreed commission. how value is createdthat is, how the percentage is determined and who are the economic agents who do it.Read more: The (in)faithful buyer

How is the price formed?

Usually the price is formed by two factors:Demand / Need. Potential clients, whether buyers or sellers (in Portugal, and with regard to real estate mediation, it is usually the sellers, property owners, who pay for the service), the question that arises is: “What are they willing to pay for the service provided or to be provided by real estate brokerage companies?”Competition, or lack thereof. What kind of competition? And what kind of service does it offer on the market? In Portugal, as I have already written in previous articles, the commission value is freely contracted, normally governed by the tendency to range between 3 to 5% + VAT, percentage this one that focuses on the transacted value. The price paid for a commission is related to the value that the real estate agency/agent produces for the payer.That’s why professional real estate agents present their services using arguments that use the technique of features vs benefits🇧🇷 Each service produced by your brand and your agency corresponds to a benefit that will be (desirably) recognized by the client so that he or she realizes the value that the professional can bring to him, if he decides to hire him. for the perception of value and/or quality that can be obtained🇧🇷 Will the prices of services, and specifically of real estate mediation services, not have to work according to this same principle? comparison trendRead more: The challenge of standing out in a booming real estate market

Commission: Is it expensive or cheap compared to what?

In real estate, this comparison exists every day, unless prices are all the same as, for example, in a development, where even then there are almost always different prices. In real estate mediation, this comparison is made by comparing the service proposal, but mainly, the person who provides it. The price may not be called into question, but its value is. More than (real) testimonials from former clients, that is, from people who have already tried the service with a certain real estate agent and with their agency, and lived an experience of positive and successful service, it will be necessary for professionals know how to communicate their value🇧🇷 Otherwise, another agent with the same level of empathy, with the same testimonials and with a more competitive “price” will seem a more logical solution. Communicate the value provided by each service that commits to providing in an engaging, systematic, consistent and mostly positive way will create a perception of value and not just a list of actions you will take to complete the transaction. Perception of obtaining greater value leads to the perception of superior quality. After all, how many of us are suspicious when the price is low and the offer is extensive? I ask: How much is its value then? value you know how to give to yourself will dictate the price others will be willing to pay for what it has to offer. Also read: How to buy or sell a house in times of uncertainty? “Real estate is my life and my life is dealing with people.” Living in Lisbon and working in Portugal, Spain and Italy, Massimo Forte is above all passionate about real estate, a business that he considers to be from people to people. With more than 25 years of experience in the largest real estate brokerage companies, he is now dedicated to consulting, training and sharing knowledge as one of the biggest Real Estate Influencers in Portugal.