The Market

Paying the doorman to sell your apartment

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By Teri Karush Rogers  |
March 23, 2010 - 7:22AM

We are hearing a rumor that at least one Manhattan property management firm is helping doormen in the buildings it manages earn real estate licenses--so that doormen can legally collect (and presumably share with the management firm) a sizable referral fee for hooking up properties with buyers and brokers with sellers. 

If true, this would formalize the customary though not exactly lawful practice of tipping a matchmaking doorman under the table.

“The thing about tips is that they’re not really legal,” one real estate agent told BrickUnderground, referring to the fact that only licensed agents are legally entitled to collect referral fees.  “Agents give anywhere from $100 to $1,000 depending—a thousand would be a lot—but I don’t really know what’s ‘normal’ because we don’t talk about it, because it crosses the line of what is ethical.”

The agent observed that legally-sanctioned referral fees of 10-15% amongst licensed salespeople are substantially heftier than beneath-the-table ones currently commanded by doormen.

Thus, it's doubtful that brokers will embrace the prospect of sharing more of their commission.

Sellers could wind up losing too. If there is more than one potential buyer for an apartment, an agent could conceivably be motivated to push for the sale that doesn’t trigger a referral fee--even if the doorman’s buyer is slightly more qualified.

Similarly, we can imagine how a doorman with a big payday on the line might be inclined to sabotage a 'competing' sale. ("Shame about those bed bugs...")

In fact, doormen (and the property management firms that wind up sharing in referral fees) would seem to be the only clear winners here.

“In my experience, there are many brokers who seem pretty shady,” says BrickUnderground’s anonymous doorman.   “They sell doormen dreams of making a killing if they help with an apartment, then when they turn around and sell it, they won’t even acknowledge the doorperson.”

Should doormen get their brokers licenses and earn referral fees? Are they?  Leave a comment or send a tip.

Teri Rogers Headshot - Floral

Teri Karush Rogers

Founder & Publisher

Founder and publisher Teri Karush Rogers launched Brick Underground in 2009. As a freelance journalist, she had previously covered New York City real estate for The New York Times. Teri has been featured as an expert on New York City residential real estate by The New York Times, New York Daily News, amNew York, NBC Nightly News, The Real Deal, Business Insider, the Huffington Post, and NY1 News, among others. Teri earned a BA in journalism and a law degree from New York University.

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