How to Earn a Commission in a Construction Negotiation

If you know someone interested in building their home or if you would like to earn a decent commission on a developer's project, being the mediator of the builder and the client can earn you extra cash just by introducing them to one another. If the construction pushes through you immediately get a percentage or the whole commission depending on the discussion with the payer.

Instructions

Difficulty: Moderate

1. Set a meeting with the the contractor you chose and your client, a developer or friend who wants to develop a property or build a home.
2. Discuss what the developer or client wants and how the contractor can execute the plan of the client.
3. Show samples of the contractor's previous works to the client. Go on a site orientation with both parties and show the client the previous works of the contractor.
4. Negotiate a good construction price with the contractor if the client is interested in the services.
5. If the client has chosen the contractor (this decision may take days, weeks, even months) you have presented, contact the contractor and discuss your commission based on the construction price given to the client. If the contractor gave a decent construction price because you helped in the pricing, expect a good referral commission.
6. Discuss the construction details. The contractor personally contacts the client and discusses the both parties sign a contract.
7. Discuss with the contractor when you can get the commission based on the payment scheme both parties have agreed on. For instance, the contractor got a 40% down payment from the client, the contractor may give you about half of your commission. Your commission may range from 1%-5% of the total construction price. Furthermore, if the client had unexpected add-on expenses during the construction, you are still entitled to get a
8. Get your initial commission fee during the down payment and the succeeding payment dates.

Tips & Warnings

• If you can think you can dictate a reasonable price where you can get commission based on percentage do so. This is possible when the you can dictate a construction fee higher than the market price.
• Be sure you're familiar with the highlight projects and strengths of the contractor or you won't be able to sell the services of the contractor to your client.
• Choose a contractor who is known to always do regular rounds and inspections on-site.
• Choose a liable contractor with good construction history. If problems arise (the contractor doesn't finish the job), you will also be held responsible as you were the middle man.
• Be wary of contractors who don't have permanent offices or office numbers, fly-by-nights come in different forms.