Let’s assume you just spent $15,000,000 on a Manhattan penthouse – would you rather receive an all-expenses-paid Vegas vacation with your real estate broker or a check for $300,000 cash back at closing? Or how about a $1,200,000 Brooklyn condo – a Tiffany key ring and bracelet or a check for $24,000?
It really should not take you too long to answer this question.
The Wall Street Journal recently published this fairly hilarious article that describes the “closing gift strategy” of various brokers across the country. Yes, the perfect closing gift has become part of brokers’ business plans to retain clients for repeat business. As ridiculous as the phrase “gift strategy” sounds, I happen to agree with it (it is, after all, the foundation of my buy-side business), but I have a very different idea of what the perfect closing gift looks like, and I don’t have to spend hours finding it or planning it (time that I spend doing actual work).
There is no question that the vast majority of buyers in the NYC marketplace would prefer a significant amount of tax free cash back at closing to a gift. In 2015, Digs has given commission rebates to clients ranging from $170 to over $71,000 (over $350,000 in the aggregate), and needless to say, they were all extremely pleased to be given that check at the closing table – often after clearing out a large chunk of their bank account and going into serious debt. My clients do love working me (and many now call me their friend), but do they really want to spend an entire weekend with me in Vegas? Probably not. They’d rather re-do their kitchen.