Deciding to NOT Move To Charlottesville – How Much is That Worth?

How much would a customer/buyer be willing to pay for the advice to *not* move to Charlottesville?

(hint: the real answer is “priceless”)

Not e that this isn’t a bitter, woe is me post; it’s a legitimate question.

A few weeks ago, I spent a full day with prospective Charlottesville residents, wonderful people who were evaluating whether Charlottesville is right for them. Ultimately, with my help, guidance, expert advice and insight, they decided that Charlottesville is not the right place for them. (that’s ok, Charlottesville’s a great place to live, but we can’t be everything to everyone!)

Thank you so much for spending the day with us in Charlottesville. You should be hired by the Chamber of Commerce, you are absolutely a great cheerleader for your town. Unfortunately, it appears that Charlottesville does not have our primary requirement …

My question is – what is coming to that decision worth?

Every meeting with a new potential client is a job interview in which we each are respectively evaluating whether we want to work together; that is the nature of a commission-based business. But … what’s it worth to have a professional real estate agent help you determine that the impressions you had gleaned from the inter webs might not be completely on point. That you probably won’t be as happy here as you thought.

Would it be reasonable to set a consultation fee or retainer?


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4 Comments

  1. Danilo Bogdanovic December 21, 2011 at 13:44

    Reasonable, yes. Realistic, not really. The real estate industry itself has made it so the public expects us to get paid if, and only if we sell a home to them. In essence, we work for free until we sell a home.

    Unfortunately, we are viewed more as sales people, not so much as professionals who offer advice – the type of advice that is usually worth thousands of dollars (if not more) in itself.

    This is completely backwards (imho) and helps breed agents who are concerned about closing a deal…ANY deal…rather than offering quality and competent advice which is in the best interest of the consumer regardless of whether it includes the purchase/sale of a home or not. Working for a retainer fee would also help minimize cases in which we spend hours, if not days helping consumers (sometimes not-so-honest consumers) only to not get paid.

    Some consumers think that free advice is great. But they may not realize how bad the “get paid only when the deal closes” business model is for them because it breeds a “sell them a home at all costs” mentality.

    On a related note…if commissions were divorced, things would probably be different. A retainer fee would then not only be a reasonable, it would be realistic. And consumers’ best interests would be better served.

    Reply
  2. Art Nesten January 12, 2012 at 15:44

    I think that would be reasonable, especially if you describe the time you will spend with the prospective buyers. If you tell them how you’ll spend a few hours going around Charlottesville with them and the sort of information you’ll provide, a fee to cover the costs of your time wouldn’t strike me as unreasonable.

    Unless you’re frequently being asked to do these sorts of things, I wouldn’t charge a high fee. But starting somewhere small, say $100 and then gradually raising it over time as you get the feeling of how responsive people are to the price might work. And if you really feel like the folks didn’t get as much out of it (for whatever reason like the decisive info you gave them was something simple and obvious), you could at your discretion forgo the fee and gain some good will.

    It won’t be a money-maker for you until you and the practice of doing so gains more recognition, but it should cover some of your costs.

    Reply
  3. Art Nesten January 12, 2012 at 15:47

    I think that would be reasonable, especially if you describe the time you will spend with the prospective buyers. If you tell them how you’ll spend a few hours going around Charlottesville with them and the sort of information you’ll provide, a fee to cover the costs of your time wouldn’t strike me as unreasonable.

    Unless you’re frequently being asked to do these sorts of things, I wouldn’t charge a high fee. But starting somewhere small, say $100 and then gradually raising it over time as you get the feeling of how responsive people are to the price might work. And if you really feel like the folks didn’t get as much out of it (for whatever reason like the decisive info you gave them was something simple and obvious), you could at your discretion forgo the fee and gain some good will.

    It won’t be a money-maker for you until you and the practice of doing so gains more recognition, but it should cover some of your costs.

    FYI, I’m a future (within 5 years) buyer who probably won’t need this service, but I’ve approached other professionals with the assumption I’d pay for their advice (and on one occasion, the professional did think the info he researched was as much of a benefit to himself as to me so he declined to charge a fee).

    Reply
  4. Jim January 13, 2012 at 08:38

    Art –

    Thanks for the insight. I’d say you’re a rarity in this area, in that you recognize valuable information and that you recognize that there is a value to said valuable information.

    I wouldn’t do it unless I could see that it could become profitable.

    Question – you say you’ve approached other professionals … would you work with each of them or just one?

    To the point of the value of researching the information – absolutely it’s valuable to I’m always happy to show properties to clients (that I know they’re not going to buy) because seeing the inventory is one of the most important things I do … as is the research and analysis I do here; I arguably get more ouf the posts I write than do my clients. 🙂

    Reply

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