Real Estate Rebates to Attract Buyers:
This isn't legal in all states. The Department of Justice believes that the ability to rebate buyers is important to competition and lower prices for consumers, and is attempting to get states with anti-rebate laws to repeal them.
Rebates As a Straight Discount Method:
If the brokerage has a large inventory of listings, buyer rebates can bring more buyers and increase revenue when the brokerage connects buyers with their own listings, handling both sides via dual agency, designated agency or transaction brokerage.
Rebates As a Trade-off for Lesser Services:
Some brokerages are offering rebates to these buyers, and not providing an agent to accompany them on showings, relying on open houses and listing agents for access. Showing services can usually be purchased separately when no other method can be found to get the buyer into the property.
Pro and Con of Buyer Rebates:
There are those who criticize this business model, as they believe that the buyers are receiving monetary rebates for work being foisted onto the listing agents that must show the property. There is also a concern that some buyers might miss negative aspects of the property that a good buyer agent would have pointed out.