West81st Where are you?

Hi, TP. Thanks for thinking of me.

For my Burkhardt Group address, just put my first name (Michael) in front of "@theburkhardtgroup.com"

Hi west81st! We miss u.
On other thread I read about the buyer's rebate your group is offering. I didn't know! It's great, I need to speak with u guys...

Just looked at your website- seems you mostly do rental - not sale (There was only one property for sale on the website). Did I miss something?

Mimi: I was planning to surprise you with a check at the closing. :o)

Seriously, I thought you knew. Anyway, the basic rebate calculation is pretty simple: one third of the buy-side split on the first million of the purchase price, plus two-thirds of the split on any amount above $1MM. Details may vary slightly depending on the services required and rendered, but that's the standard deal.

ph41: I'll let Keith address the question about listings when he visits the board. At this point, I'm only working with homeseekers.

By the way, within his general framework for rebates, Keith encourages innovation to suit each client's needs and circumstances. To avoid misunderstandings, please confirm rebate details with your agent before submitting an offer.

ph41: I stopped my sales business altogether about 2 years ago, lucky or smart? Probably just lucky. So since then I have focused on rentals; offering discounted fees, rebates and flat rate consultations.

Today I am starting to get back into some sales with more interest in representing buyers. I have not accepted most of the sales listings people have offered to me. Today mostly only triple A properties are selling (when priced correctly), I have no interest in taking on a listing I believe is over-priced, undesirable or worse...both.

When representing a buyer I am on 100% equal footing with any broker at any firm in the city thanks to today's technology. I also happen to come with 20 years experience. No this ain't brain surgery, but having a competent, knowledgeable and honest broker on your team can be of great benefit to you as a buyer. Add a truly fluid commission/rebate schedule(in real life and theory) and you just may actually like your broker. : )

I will accept a sales listing if I think it makes sense and for that my commission schedule is 3.5%; 2.5% to co-broker and 1% to me. The property I just sold on West 12th street was listed according to this schedule. Since the vast majority of sales take place with two brokers involved, I can also be equally as effective as anyone else, again thanks to the current technology. Other brokers look for listings in their internal data bases, OLR or the NYT's-my sales listings are in all those places.

I disagree that brokers steer clients away from properties listed at 5%. I have sold properties even in the boom times with a 5% commission. Any broker that would admit to this or suggest it is not worth dealing with. And imho is using a scare tactic to squeeze an extra 1% out of you. When I see a listing ranting about offering 7% or more, I think "Whats wrong with the place?", to me it's a red flag. In my opinion, the seller is better served with lower costs and lowering their asking price.

How can I do all this? The monkey is off my back (the brokerage firm). My idea is not to get rich off the commissions of agents working with me, but to be able to offer a new model. Will I make a couple of bucks? Yes. We are truly negotiable, and each agent has the ability to structure their own deal best suited to their customer.

west81st or keithb: How exactly do the rebates work? Does the buyer pay income tax on it or does it just reduce the cost basis? Do you consider it an expense and issue a 1099?

From everything I have read and been told rebates are not taxable. Michael may be able to go into a bit more detail.

Sorry meant to post that under KeithB. "theburkhardtgroup" is my former handle..

How about on your end? Does the rebate count as taxable income since it's a portion of your commission?

Wyndcliff: The link below addresses tax reporting and, by implication, tax liability. The specific IRS finding described in the Redfin press reelase states there is no requirement for 1099 reporting. It is reasonable to infer that the rebate is not taxable, although - as the press release explains - Redfin lacked standing to pose that question directly.
http://www.redfin.com/about/press/releases/pr-irs-ruling

With regard to the broker's own accounting, I don't know whether the rebate is construed as an expense or an adjustment to income.

Michael, are you still at Burkhardt? My pal with the cool idea may actually be ready to show it.
Lofty aka Trinityparent.

Lofty/Trinity: Sorry I missed this when you posted it. the burkhardtgourp.com address works (michael@...) as does the old west81st address @ gmail.com

"gourp" s/b group. A little too much Christmas cheer here in the woods of Pennsylvania.

Thanks, and top o' the new year to ye.