Who gets the Comm?

Broker 1 showed multiple properties to a buyer, but none were satisfactory. Months passed, and the buyer continued their search for a suitable property.

Among the properties initially shown by Broker 1, one reappeared on the market, now offered by a different broker (Broker 2) and at a significantly lower price. The buyer, curious about the new price, reached out to Broker 1 for confirmation. However, Broker 1 did not respond, possibly due to frustration with the buyer.

The buyer then visited the property with Broker 2 and ultimately decided to purchase it.

Several months later, Broker 1 learned of the buyer's purchase and demanded a commission, arguing that they had shown the property to the buyer first.

Question: Does Broker 1 deserve the commission?

Option 1: Yes, the full commission should go to Broker 1.

Option 2: Yes, but only a portion of the commission should go to Broker 1.

Option 3: No, Broker 1 should not get the commission.

Poll Results

An overwhelming majority (93%) voted for Option 3: Broker 1 should not receive the commission. Meanwhile, only 6% voted for Option 1: Broker 1 should receive the full commission.

It’s evident that the majority recognizes Broker 2 as the procuring cause, meaning the transaction was closed primarily due to their efforts. Simply registering a client with the sellers or showing a property does not make Broker 1 the procuring cause.

But consider this: what if the buyer hadn't contacted Broker 1 after discovering the price reduction? What if the buyer wanted a relative to earn the commission and deliberately excluded Broker 1 from the deal?

I have always believed that the buyer and seller ultimately decide who represents them. This is why offer letters (LOIs) typically specify the brokers involved in the transaction. However, submitting a simple Buyer Representation letter to the seller before the second showing could have resolved these issues in advance. That's just my perspective.