Paying a real estate agent I never buy through

September 12, 2007 7:23 PM

I'm working with real estate agents in three cities I am considering relocating to. I will only buy through one of them, obviously. Should I tip the other two?

I've asked these three agents to do a fair bit of work for me -- finding houses I would be interested in that meet my specific criteria (criteria I can't specify in the online search engines); telling me about the three cities (they're all on the other side of the country); spending a day or two with me showing me the city and several houses so that I can evaluate what a specific job offer in each city would actually buy me.

Should I give the two that I don't use a tip (for lack of a better word)? A gift certificate to a nice restaurant? How much? Should the value of the tip be related to the value of the houses I am looking at (i.e. bigger tip if I am looking at expensive houses)?

Thanks.

posted by Capri to work & money (14 comments total)

Practical Answer: I have no idea, having never worked in real estate or been in a similar position.

Ethical / Moral Answer: Hey, wow, what a great idea! Were I in your position, I would certainly go out of my way to send them a nice thank you card plus some sort of gift (monetary or otherwise). Couple hundred bucks might not be inappropriate, depending on how much of their time you spent. And considering that technically you don't owe them anything, since you didn't complete a transaction with them, even $20.00 would be nice.

If selling real estate is like selling anything else, I'm sure they have many potential clients who then vanish without a trace. If you ever find yourself considering another move, leaving a pleasant memory to come back to can only be a good thing.
posted by ZakDaddy at 7:46 PM on September 12, 2007

although very nice, it wouldn't be necessary or expected...
posted by dawdle at 7:51 PM on September 12, 2007

The best thing you could do is refer other clients to them. I think a nice handwritten note would actually be well beyond the call of duty, and probably even more appreciated in a lot of ways.
posted by COD at 7:53 PM on September 12, 2007

no
posted by bruce at 8:25 PM on September 12, 2007

No. their business model accounts for situations like this; you don't give Macy's money when you go look around and decide not to buy that day! Another way of looking at it - you're giving the realtor you do go with the money you 'owe' the others, just as a client of those realtors is giving them... ok, this sort of makes sense right?

I'd think a handwritten card would be very appreciated.
posted by crabintheocean at 8:41 PM on September 12, 2007

No way.
posted by The World Famous at 8:42 PM on September 12, 2007

I am a real estate agent, and I would say no. It's par for the course, expected, and all those things. That's why the percentage paid to an agent can seem ridiculously high for one deal that does go through, but doesn't take into account all the deals that don't lead anywhere.

Don't send them a tip, send them a referral. Or more likely, if you don't know someone looking for a home in the area, write them a testimonial letter. Describe how helpful they were in the process of looking for a home; no need to mention you didn't actually buy one of those homes, focus on the positive aspects of your interaction with the agent. We often use these on websites, in portfolios, etc.
posted by shinynewnick at 9:41 PM on September 12, 2007 [1 favorite]

You could send them a gift basket for the office- I usually use/ recieve ones from this company and have always enjoyed/ gotten rave reviews about them. It's a small gesture, but a practical and thoughtful one. IMHO
posted by MayNicholas at 10:20 PM on September 12, 2007

We've had similar questions before.

I don't know where this idea of tipping realtors came from (probably the realtors themselves) but there is never a reason to tip a realtor. They make plenty of money off commission already. Part of the job includes investing time and effort to clients that don't pan-out. It's part of their job.

At most, a thank-you note is called for. Maybe a referral, if possible.
posted by Thorzdad at 4:45 AM on September 13, 2007

My husband is in the business.

It isn't required, but a restaurant gift certificate would be nice (occasionally people in just this circumstance have done this for him.)

If you have opportunity to give these other people leads, that would be awesome as well. And a nice thank you note is always appreciated.

BTW, most realtors do NOT make "plenty of money" and the time they spend helping someone who does not buy is time they are not using working with someone who DOES.
posted by konolia at 5:47 AM on September 13, 2007

Was an RE Agent for a short time, and I agree 100% with Konolia. It's not required, its not expected, but in a job where so much effort is routinely put out in situations like this where nothing comes of it, it's always nice to get some token of appreciation, even if it is just a token.
posted by John Kenneth Fisher at 6:31 AM on September 13, 2007

If the are exceptional (no hard sell nonsense) and you feel inclined, maybe. But seriously, these are people whose jobs are to drive up housing prices. Tip? Tell them: "Watch your back!" or "Be careful when the lights go out!"

Am I bitter? You bet! I live in a place where my lawyer told me estate agents (as they are called in South Africa) are the "new lawyers". Nuff said?
posted by Goofyy at 6:43 AM on September 13, 2007

"these are people whose jobs are to drive up housing prices"

.... wha?
posted by John Kenneth Fisher at 7:00 AM on September 13, 2007

Thanks for all the answers. A few responses are in order:

1. The idea was mine. It's based on an appreciation of the work they are doing for me, uncompensated. It's not an idea I got from a realtor.

2. To Goofyy: I also appreciate the work that my realtors are doing for me, which is why I hire them in the first place. I have zero desire to make all the arrangements to see houses, I have little ability to answer all the questions I have about a housing market I am not familiar with, and I have no time to get to know each town I am considering relocating to. I am well aware of the value of the services they provide, which is why I sought them out in the first place. Thus I do feel that it is fair to compensate the realtor who represents me in the actual sale, and also to compensate (at a lesser level) the realtor who represents me where no sale comes about. As far as them driving up the cost of housing, as a house owner trying to sell my house, that's not a bad thing either. I'd like to get a good price for the house.

3. Also to Goofyy: I am a lawyer, so I don't really take kindly to the notion that realtors are necessarily evil because they're akin to lawyers. Your bitterness has blinded you to the huge services that lawyers do. Spend an hour walking around most major cities in developing nations, where tort law hasn't taken root, and you'll see holes in the sidewalk with rebar sticking out of them; broken glass on playgrounds; cars with no rearview mirrors. Spend any time where there aren't environmental regulations created and enforced by lawyers, and you'll be sickened by the air and water pollution. Spend some time in a place where contract lawyers don't thrive, and any business transaction you enter into is protected by force, not law. Spend time in a country without civil rights lawyers, and complain at your own risk. There are crooked lawyers, and realtors, out there. But the professions themselves exist because they add tremendous value. I for one am quite willing to pay for services rendered to me.

So, I think I will give each realtor who does not get my business a heartfelt thank you, a token gift, and any referrals that I realistically can give. And I will give the third a hefty commission.
posted by Capri at 7:26 AM on September 13, 2007 [1 favorite]