Negotiating with sellers of homes is not my thing. An icon for my negotiating skills would be a sledgehammer. The “greeter” in my park, however, is fantastic. It’s like a giant game to him to see how low he can get something. I’m good at finding homes for sale but not at negotiating a price that makes sense for me.
Suppose I put Mr. Miller (the greeter) to work for me. I’ll turn up homes that interest me plus he can find things in the paper and online. I should think calling 10 for sale ads a week wouldn’t be too hard. Assuming he finds a home I like and at a price (steal) that works for me, what would a reasonable, cash, finder’s fee. He would only receive the money once I complete the purchase.
I’m in a slightly different situation. I do the Lonnie deals in other parks as a full time job and I have “agents” that locate, negotiate, and purchase the home. Then they turn around and show, negotiate, and sell the homes. I do these for investors and charge them a fee to do it.
The way I pay my agents is on a percentage of my fee. You are not charging a fee, so it’s differnet in your case. I’m just showing my way, to sort of help out.
Right now, the fee for my service is 4,000.00 upfront. 500.00 is a referral fee to whomever brought me the investor. I then pay a dividend of 250.00 to my partner. This leaves me with 3,250.00. The agent gets 40% of this to buy and sell a home. When they purchase, they get 650. When they sell they get 650. This is what we agree to for the first three homes in a month. If they get me four deals done in a month, the percentage goes up to 70%.
It’s a sliding scale with some incentive to do more. I like it because I pay no salary, I only pay when they perform, and if they hustle they can make more. I would suggest something along those lines with your guy.
I would offer something reasonable like 400.00 cash for negotiating a home. Then offer the same if they sell it for you. Have a mark that he needs to reach to receive more. This way you are paying for results and it shows him that you are willing to pay more, for more results…