The Cost of Representation vs. The Cost of Regret: Understanding Real Estate Commissions in San Francisco

Every few months, another headline lands announcing that real estate agents are overpaid, under-regulated, or part of some vague conspiracy to keep commissions high. The most recent report from the Consumer Policy Center insists buyer’s agents are charging “too much.” It’s a neat soundbite. It also shows a deep misunderstanding of what the job actually requires.

Here’s the truth that somehow keeps getting lost.

I don’t earn a salary. I don’t get paid by the hour. I don’t bill for the months of prep, consultations, showings, strategy, problem-solving, hand-holding, vendor coordination, and negotiation that happen before a deal closes. I only earn money if a client closes. And if they don’t, I absorb it. Fully. Quietly. Without complaint.

That’s the model. It has been the model forever. But the critique never seems to account for it.

The CPC’s mystery shopping experiment asked agents to quote fees over the phone, skipping the part where an agent actually meets the buyer, understands their financial picture, needs, timing, complexity, risk tolerance, preferred neighborhoods, or the realities of buying in a place as nuanced as The City. You cannot price out representation in a vacuum any more than you can price out legal work or medical care without knowing the case. (Why those agents gave a quote without getting to know the person on the other end??? I couldn’t begin to guess.)

But the bigger issue isn’t the study itself. It’s the premise behind it.

This idea that buyer’s agents should charge less because someone believes the job is easier than it is.

It isn’t.

Buying in San Francisco can involve tenant law, condo conversions, structural disclosures, soft-story retrofits, title complications, HOA politics, special assessments, unpermitted work, historic restrictions, and a labyrinth of code compliance realities that change year to year. It’s not door-opening. It’s strategy. It’s risk management. It’s understanding the difference between a home you love today and a home that will still love you back in ten years.

People don’t hire me for access to a lockbox.

They hire me for the mistakes I keep them from making.

The CPC’s recommendation that buyers should simply pay their agents out-of-pocket, or finance their representation into a loan, sounds tidy in theory. In practice, it instantly prices out many buyers and pushes them into underrepresentation or dual agency situations that increase risk for everyone involved. Lenders aren’t set up for this. Prices don’t magically adjust downward. And pretending the solution is as simple as “buyers should pay more up front” ignores the financial realities of the group the CPC claims to be protecting.

The other suggestion, that agents will just “lower their fee if there’s pushback,” assumes we’re running a flea market instead of handling multi-million-dollar transactions with enormous liability and no guaranteed income. That line alone tells you everything you need to know about how little they understand the work.

My clients see the value because they experience it.

They see the preparation.

They feel the clarity.

They get the protection.

They benefit from the relationships, the foresight, the local knowledge, the negotiations, and the instincts that come from nearly two decades in this market.

They hire me because they know what it costs when you hire the wrong person.

They hire me again because they know what it saves when you hire the right one.

I deserve what I charge because my fee is not for showing homes. It’s for advising on the biggest financial and emotional decisions people make in their lives. It’s for preventing lawsuits, financial losses, and sleepless nights.It’s for strategy that gets people into the right home with the least risk and the most confidence.

No one questions what a surgeon charges. No one tells an attorney they should take less because the case “seems simple.” No one mystery-shops a CPA to suggest they shouldn’t be compensated for their expertise.

Real estate deserves the same respect. The value of representation isn’t hypothetical. It shows up in outcomes. And in The City, getting it right matters more than ever.