When I mentioned to a friend of mine that a closing had gone well and on schedule a couple of weeks ago, he quipped, “Where are we going to lunch tomorrow?”
In his mind, receiving that commission check was, understandably, like getting a bonus.
His is a belief that probably most consumers share, namely this: A closing is similar to a windfall for a broker.
In fact, a closing and the check that we are handed at the end is nothing more than getting paid–and then only after every scintilla of work is completed–many, many months after the work began.
It happens that I hadn’t been to a closing in a couple of months, so I hadn’t been paid that long. Instead of feeling that I had been granted a bonus, I focused on knowing that the money would enable me to replenish my checking account and make some long-delayed purchased.
Mind you, I’m not complaining, merely trying to provide some insight into a broker’s perspective.
To the folks sitting around a conference table, of course the payment of thousands of dollars in commissions seems excessive (and sometimes it is). But human nature makes it easy to forget the number of hours that a broker can spend either marketing or searching for properties, then negotiating their price and finally seeing the transaction through to a successful conclusion.
More important, the number of hours expended has almost nothing to do with the value that good brokers add to a client’s sale or purchase in the same way that the time a physician spends treating a patient is less important than his or her ability. (When it comes to locating probable properties, buyers are just as adept as are brokers in the Internet age.)
What adds value is experience, expertise, a modicum of psychotherapy, attention to detail, analytical skills, organizing ability and knowledge of the market.
Still, there is a paradox operating here: Brokers glorify themselves, but the truth is that we are little more than hired hands.
All the foregoing means is that I took the check at the end of closing, brought it to my brokerage, received my own check, endorsed it and deposited the funds that same day.
So, rather than planning a celebratory lunch or, it turned out, even savoring a cocktail, I went to my computer, where I put the finishing touches on my e-newsletter, updated my BlackBerry’s software and finally paid some bills.
I’m sure that friend of mine and I will go out to lunch soon, but it will be less a celebration of a paycheck than of our friendship.
Note: For my critical comments about a variety specific properties, you may want to check out the Out and About section of the comprehensive e-newsletter that I write and publish on alternate Fridays, covering a range of news about the U.S. and New York housing markets, mortgage developments, household tips, celebrity sales and purchases, research, and experts’ prognostications.
Licensed Associate Real Estate Broker
Senior Vice President
Charles Rutenberg Realty
127 E. 56th Street
New York, NY 10022