News Flash: Your Realtor is Being Underpaid

You’ve Seen the Headlines: Realtors Now Have to Negotiate Commissions!


I’ve been calling for this since Ron and I entered the profession. It’s the first thing we talk about with our clients when we virtually sit down with them. Here’s my view of what’s happening…

Big brokerage houses have pushed their agents to hold the line on commission fees. Agents appear to make a lot of money, but the fees we have to pay to work with a brokerage are often exorbitant. On top of that, you’re self-employed, so add insurance, taxes, and expenses, and the cost of being an agent climbs quickly. Where are my 1099 workers at!

And in defense of these brokerage houses, many real estate transactions become very complex, and having a brokerage to stand with you, and walk you through the transaction is key. And it’s expensive! The training for agents here in the State of Washington is not helpful. Take the test to become a realtor and you’ll find everything you study and are tested on has nothing to do with the profession.

10 questions on the test about a FEE SIMPLE ESTATE! NEVER COMES UP!!!!

These brokerage houses, like Windermere where I started, provide that. And they saved my bacon many times. And just like the tax code, the rules to real estate change every year. These brokerage houses have to stay on top of that, and on top of their agents.

Paying a fee to have a great Managing Broker and a brokerage that has your back when deals go south…and they do quite often, is expensive! Many of these brokerages have real estate attorneys on standby to deal with all the issues that come.

Every transaction is as unique as the clients we represent.

And as far as commissions… Let me give a few examples of agents that aren’t paid enough.

See that green house above. I bought it with a partner as an investment property years ago. The agent on the other end charged the woman living in that home (her client) 1 percent of the deal. NOT 6 percent! That was a hoarder house and it was a very difficult lift. No one charged 6 percent like you are reading. This agent knew the woman and her partner living there and she knew they would need every dime in retirement and she knew it was too emotional for them to bring to market. There is a lot of shame in “collecting” or hoarding.

MOST homes we sell are in disrepair. This was a very difficult and time-consuming transaction, as the house had a foundation that snapped in the Nisqually earthquake. I know this because I spent a whole SUMMER JACKING IT UP! using 60 jacks with my crazy partner Joe, and our contractor Dave. A.I. was not there to give us a hand.

I guarantee the agent you work with, if they have spent any time in the business, deals with this all the time.

I bet after paying all her fees and taxes, this agent made 3k.

One thing that was shocking to me about the profession when I entered was that realtors often are like paramedics in that we see people on their worst days.

Just the pictures I took this week, and will not show are so heart breaking.💔 I take these pictures to show my contractors the extent of deferred maintenance on many homes, so we can build a plan around them to bring the house back from all its neglect, and then we create a plan for our sellers or their estate to get max dollars once we go to market.

This takes A lot of time and expertise!

  1. One house I walked into this week, a man had lost his battle with cancer. I stood in the room where he passed and felt his presence. I could tell he was a good man. It is hard to maintain a home when you are fighting for your life. It is a home that has to be fully renovated to help pay all his bills. Some realtors would say hang a sign and flip it. But the realtors I know would roll up their sleeves, call in the cavalry, and save the home. It’s probably a 7-month project. The family will garner $350,000 more in the sale as a result. What is that realtor worth? They are going to have to bid it, bring in the subs, deal with a lot of family emotions… and the realtors I know will tell you it is an honor. Then they have to inspect it, market it, sell it, and close it. There are about 25 people involved in your transaction you never see, and it is often the realtor paying out of pocket on your behalf.
  2. Another story…just two days ago…Ron and I sat down with one of our favorite humans. We will call him Danny. Danny had a home we renovated a few years ago in Seattle…and then we sold it on day 2. Without the renovations, Danny would have lost $250,000 in the sale. He would have had to sell to a builder. We worked hard to fix it up to find a retail buyer for Danny. After the sale, he invested that money and retired on a really cool island nearby. He’s a Vet and a Vet volunteer, and he’s one of the best humans I know. He also bought another home for his son who was going to school.

    Now life has thrown a curve, and after recently getting brain surgery, he needs to head back to the city. His current home needs some work to get max dollars for Danny and his medical bills. He needs to move back to the city to be close to medical services. He doesn’t have the energy or connections to do the repairs.

    Danny is not a transaction to us. He’s our dear friend, a vet, a great dad, and we have his back…and we would do this for free. And sometimes we do.
  3. We fixed a home last year for a family with a child of special needs. Realtors like us often give free hard loans to our clients that can’t do the repairs themselves. Then we use our subs and relationships to get all the work done at a much better price because we have leverage with all the contractors because we provide constant work. Then we bring it to market, and we get paid at the close.

    What is a $90K hard money loan worth with no interest? I guarantee your realtor often reaches into their pocket to help others too.
  4. Sometimes we give it all away! We recently sold a halfway house for Plymouth Housing in Ballard. It was a very rough house and a hard sale, but we shopped it and shopped it, and after 18 months we closed for over $1.1 million. The commission was about $30k. We donated every dime back to Plymouth Housing to help the homeless. I guarantee your realtor has done that too. We asked the buyer’s agent to donate his too…and he did!
  5. And on the buyer’s side, some realtors are transactional. They get their commission and head to Maui. But not all the good ones I know. I am currently trying to buy a house for a young couple. The house we are looking at needs 29 things immediately done according to the inspection report, including dealing with a mold issue. Guess who gets to deal with all those items once we close. Me! Their realtor! 😊 who in this case, I am on the buyer’s side.

What is that worth?

And finally, the pictures you see above…those are our crews working on a home we helped another young family buy. It was a house in great disrepair. Knob and tube, water intrusion through the floor, and plumbing that seemed to be from 1776! I think Ben Franklin lived there at some point😂 Those pictures are our crews saving that Craftsman, and building out THREE affordable apartments. The family will live in one door, and rent out the other two. Those two doors will pay for them to live on the property for free and even create cash flow. I have been working with them for 8 months…and every time they need something…who do they call? Their realtor. And great realtors want you to call…anytime you have a problem…they are there to show up for you…in whatever form. 📞

I wish I could say every transaction is beautiful…someone got married…someone had a baby…someone got promoted. Oh, that does happen and there is such joy in that…

But your realtor is often dealing with family law attorneys, reverse mortgages, living trusts, wills or lack thereof, family trauma, divorce, domestic abuse, dementia, mental illness, Parkinson’s, sudden death, slow painful death, and the list goes on. A.I. can’t negotiate that… But your realtor can.

It is about time my industry openly talks about commissions. But also understand there are a lot of great realtors out there that can’t be simply set aside by big corporate entities or better technology. Look up Realtor Wes Jones. Any home he touches is typically worth 100,000’s of dollars more. He is not paid enough in my view. He embeds himself with his clients!

Currently, I have a client in a house Realtor April Geneva just brought to market. It had been a rental. I can see the old pictures of it online. Now it has to be worth $200,000 more due to her fine work in restoring it! She deserves every dollar. What a pro!

And do you really want A.I. to negotiate on your behalf going up against Realtor Javila Creer, who is a super agent, a superhuman, and the best negotiator in the business? A.I. will get sent home just like Mike Tyson is about to get sent home after destroying that young YouTuber in the boxing ring this summer. She is a boss in every negotiation, and YOU want an agent like her on your team.

Here in Seattle and our bedroom communities, our properties, micro-markets, and our homes are as unique as the humans that occupy them. A great realtor will meet people where they are at in their real estate journey, provide incredible value, and now they will have to show their value to you, and know you, and your neighborhood.

As I said, your realtor helps employ on average 25 people to get your transaction done. One realtor may employ hundreds of people every year. We create A LOT of work in the community. That’s a good thing.

If good realtors are guilty of anything… it is not showing their work. Now they will have to in order for you to hire them. And to those that are transactional… or just door openers… or for those that don’t even understand the homes they are helping to buy or sell… Good riddance.

It was time… And now it is time… On a Saturday… To go do what your realtor is probably doing… Attend a sewer scope, write two offers, stop by 6 open houses, and help a client write an Airbnb ad, and get my boy to The School of Rock! AND!!! grab a maple-cinnamon latte at Cafe Ladro with a favorite client-friend of mine. “COFFEE IS FOR CLOSERS!”

Love to ALL THE GREAT REALTORS! Time to show them how good we are! We are our client’s experts, advocates, friends, comforters, and 🐂 bulldogs! And the best negotiators around.

I’ll be reading your comments below. Let’s continue the conversation and celebrate the hard work and dedication of great realtors everywhere!



When Don is not behind a microphone, you might find him helping clients shop for properties to buy, invest, or sell. As an active investor, Don seeks out properties for long term investments. Schedule Your Sit Don with Ron today!

3 thoughts on “News Flash: Your Realtor is Being Underpaid

  1. Well said! I have encountered so many of the things you mention with my beloved clients, (which none are transactional, they are people). I will continue to provide the level of service I always have with compassion, caring and sometimes tough love. I look forward to what the future holds.

  2. Thank you Don for supporting our industry in a time of misleading ”click bait” headlines, even worse, articles that don’t represent the actual truth.

    We work hard to protect our clients interests on both sides. I know I have saved buyers from disastrous situations, negotiated repairs & closing costs, and in our hot market got offers accepted that weren’t always the highest price. There is a great deal of skill that comes into play. For sellers I have threaded the needle to achieve the maximum price and terms many times.

    Bottom line, a great REALTOR is worth every penny, their value more than pays for itself!

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DISCLAIMER: Ron Upshaw, Managing Broker License #22027577 & Don O’Neill, Broker License #95294 are brokers with Kelly Right Real Estate

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