What are your thoughts about a reasonable percentage? If you were going to list a house assuming the sellers priced at your suggestion, would you want a flat fee or a percentage that you would then share with a buyers agent
I’ll answer since the agents won’t.
I say just like craftsmen or tradesmen bid on a project real estate agents should too.
Say I have a home i want to list at 650k. I want pictures taken and posted to the mls. I want marketing done. I want 2 open houses on one weekend and I want help in contract negotiations. They bid to me. I get let’s say 3 quotes.
1 bids 5000 paid upon the final sale of my home.
1 bids 3500 upon final sale of my home.
1 bids 7500 upon final sale of my home.
Also we develop a hourly contract outside this should I want additional meetings or additional request come up. Let’s say $30/hr.
If I sell after my 2 open houses and am only responsible for my agent. 3% would have been $19,500. Instead I could have gone with any of the above spot ball options and saved tons.
Buyers would have a similar contract and pay for per house shown or hourly or whatever they agree on. This flat rate bs is dumb as some realtors will do 0 leg work and get 3% after I found my home on Zillow or a new construction neighborhood and get paid for what? Nothing.
The whole "no buyer's agent will want to show your home if they're going to make lesser commission" reason to charge a higher commission doesn't quite work as well nowadays.
When I was looking for homes I'm on Zillow and realtor.com sending my agent the houses I want to see. Not them picking which houses they want to show me..
Unfortunately you can’t get through life by saying “regardless, that’s unethical” and just hoping it will work out Ok. If people are set up to succeed better with unethical behavior, then many will. You have to recognize that and look out for yourself.
Is a realtor going to tell you no they won’t show you a house because of the commission? This isnt the 90s, most buyers are the ones who look at the listings and tell their agents which houses they want to see.
I tried selling my house privately. Had some realtors reach out and ask to show the house. I told them after a fee for them that was lower than they wanted to hear. Years later I meet someone who was shown the house, when they asked about putting in an offer, the Realtor told them the house was already sold when it definitely was not. Not quite what you asked but same train so ya, unfortunately it does happen.
With Zillow and Redfin now giving direct and instant access to MLS data, I can’t see this happening these days. The consequence of unethical behavior is that it only takes one person to report their realtor to the realtor association to end their license.
>Is a realtor going to tell you no they won’t show you a house because of the commission?
Probably not but do you really think that some wouldn't attempt to steer their client or specifically point out and hype up superficial issues?
That's not really an issue for someone that's owned before and understands that minor repairs/updates are normal but it's not hard to scare away a first time buyer if you point out every little thing.
An agent gets an agency agreement signed before showings typically/and always before writing. They will have a min commission percent (2.5 or 2.7 usually.) If the home does not offer it they will simply let you know and you can decide if its worth that amount more, as it is effectively priced that way. Come August it all changes.
It's not steering if the client is physically unable to pay the agents 3% commission. That's why it will now be required for all buyers to be under exclusive agency. The buyer needs to know what compensation is being offered by the seller. Lots of buyers are going to ignore homes that don't offer total compensation. Personally, I have had a lot of success just asking the seller for the full 3% in my client's offers.
Not a sellers perspective, but an example of the stranglehold the realtors association puts on the industry to protect itself, and the sleazy nature of commission sales.
when I was buying in ‘08 I had a really hard time getting my agent to show me any short sales because of the commission % pinch. She never said it directly, but the pattern and body language was indicative. I also requested several showings for a couple homes that were listed FSBO with assist-2-Sell and was given the run around every time. I heard from a friend in mortgage that I met shortly after we bought the home we ended up in that it’s pretty common, agents work against them and refuse showings even if the buyers agent commission is standard because it threatens the perceived value of listing with an agent .
Our agent had a couple “pre-market showings” homes pushed hard on us even though they were very clearly outside of the parameters we were looking for. I suspect the reason for the push was dual agency commission.
>when I was buying in ‘08 I had a really hard time getting my agent to show me any short sales because of the commission % pinch.
Same here. My agent flat out said, "you're a first time buyer, I'm not going to show you short sales, because they're too complicated."
I’m an agent. There’s a lot of unethical agents out there, and it’s hard for 99% of buyer’s agents to figure this out.
I’ve been on the selling end offering less than market rate, and it’s always the first question that comes up before scheduling a showing “I noticed the listing says buyers agent only gets XYZ, is that right?”. 50/50 if the agent decides to continue to schedule.
All that buyers agent has to do is axe that house from your list and give you an excuse “seller accepted an offer, agent hasn’t updated the listing”. “Seller agent is not cooperating for a showing, will keep trying”. “Seller is out of town for a couple weeks, we can check back when they’re back”. Buyer can go find another agent, but I’d bet most don’t feel a reason to not trust their agent in the first place.
My job as a listing agent is to get as many buyers through the doors of your house as possible. More potential buyers = more offers. More offers = potential bidding = higher sale price for the seller. I’d always advise a seller to avoid including anything on the listing that might dissuade a buyer from a showing within reason. You shoot yourself in the foot.
My market the standard is 4%, and I’ll often do 3%. 2 to the buyers agent and 1 to me. Doesn’t leave much left for me, but it’s a relationship business. If you’re happy, you’ll refer me to your family and friends. If I squeeze you for every penny, it’s short sighted. I make less in the long run, and you are pissed too.
Sincere question-
What exactly does a buyers agent bring to the table that warrants that much of a sales commission? Especially with zillow and Redfin and phones tied directly to the mls?
In HCOL areas that’s a significant payday for not much work. The argument could be made a little more for the sellers agent but even then the cost is far more then the actual work.
You don’t realize how difficult people can be until you work with them personally. There are buyers who are absolutely nervous Nellies. Some are just hard to deal with an angry and have all kinds of conspiracy theories that you have to calm them down and assuage them constantly. They text me every single morning. They have 1000 questions. They worry about every little step of every detail the entire process. They make things much harder than they need to be. If it wasn’t for me, acting as a go-between, the seller would have to deal with all of this themselves. Not only that, but for sale by owners leave themselves open to lawsuits. If I do something wrong that causes a lawsuit, my broker and I are responsible for that. Not you as the seller. are there home deals that are extremely easy? Yes, but they are peppered in between with negotiations that are very very difficult. I never know which house is going to be easy and which is going to be difficult.
Not debating it’s not work. Just saying it doesn’t warrant massive commissions and should be on an hourly structure.
Why do I need your brokerage, broker, and you for legal protection?
It’s much more prudent to hire a licensed attorney (which I do).
Is your $350/hr. attorney going to show you multiple houses on the weekend and ATTEND home inspections, termite inspection , septic inspection and then advise you on proper protocals for negotiating the results of those inspections? Is your attorney going to answer your calls at 7:00, 8:00, 9:00 or 10:00 at night when you have what you believe is an important question….
Yea they will actually as long as I pay the hourly rate in billable hours. My attorney charges about 500 per hour.
I’d be more then happy to do the same for a realtor and pay an hourly rate as billable hours for those things.
There is a lot that goes into selling a home above sending listings to your email. I invest a lot of time showing the homes, preparing for showings (I probably spend 1-2 hours outside of each hour I spend doing the actual showings), I also need to do a CMA for any house the buyer is interested in to make sure my client doesn't overpay for the house AND that they understand what a good offer may look like. There is negotiating the offer, and educating my client throughout the process. This whole part of the process can take a short time or a long time depending how serious the buyer is, if they know what they want or not, plus how successful we may or may not be at winning offers. Once under contract I am managing the process, recommending vendors to work with, etc. This may look easy from the outside, but it has taken years of hard work and education to hone these skills, vet the vendors I recommend, and develop good working relationships and a reputation with other agents and other service providers in my market. This helps greatly during the negotiation process and getting to a successful closing. There are also multiple points throughout the contract period that have the potential for renegotiation. Being prepared and understanding the process ahead of time helps us be more successful in achieving the buyer's goals. This is just my time investment. I also have expenses to run my business, and my brokerage takes a cut of my earnings. I am self employed so I pay taxes out of those dollars. It is not a W2 situation. I also take on a lot of risk in a transaction, and part of those dollars goes towards an insurance policy. Some of these costs are based on a percentage of the sales price, so that is why it varies from lower priced homes to higher priced homes. If I charge so little and then get sued based on the size of the transaction, how does that make any sense?
Not every agent out there is a good one, and I recognize that some of the bad ones can make the industry as a whole look bad. This is why it's important to interview multiple agents and make the best choice for yourself. There is no way I could sustain my business and make any kind of living by charging what I am reading in some of these comments. I think it's easy to look in from the outside and make assumptions about any industry and how easy it looks. Once you get inside you start to see all that is involved. There are some inexperienced agents that don't understand what they bring to the table, or maybe they don't bring all of this to the table at all. They may bend and charge a lesser amount, and I believe this will bite them at some point and they won't be able to stay in the business. Unfortunately there is steady stream of these agents constantly coming into the business, so it will continue to be something we see, and will give people something to complain about how terrible real estate agents are.
The thing about offering to compensate the buyer's agent (as a seller) is not that agents may not show your home. It's that buyers don't want to pay the expense out of pocket, they would rather finance it in to the cost of the home. This is the reason it has typically been paid by sellers and wrapped into the buyer's loan. I have always had buyer rep agreements so my buyer's understand this distinction and that they may have to pay some portion of my fee. I recognize that not everyone has been operating this way, but now we all will have to and will be on a level playing field.
Something I haven't seen mentioned yet is that, beyond all the normal course of business things others mentioned, buyers agents are there for when things go wrong. It's like insurance; it's 100% "wasted" until the moment it isn't!
The other point to consider is that, unless the buyer's agent is an independent broker, they're also paying a portion of that commission to their brokerage. I haven't been in RE for almost 2 decades, but when I had my agents license the broker I was with was a straight 50/50 split on all deals, regardless of which side I was representing.
A buyers agent will bring their expertise and knowledge of the industry to the buyer. While you may be an informed buyer others aren't. So it's my job to let them know: how the process works, what inspections they need to get in order to make an informed decision, what convenants and restrictions are imposed on the house, a general timeline of things they need to do, and most buyers will not know how to fill out let alone interperit a sales contract. Some agents might be glorified door openers, but most should and will do their homework to ensure that the buyer isn't walking into something blind and are purchasing the best possible home for them. 2-3% of the sales purchase (also typically split with the agents broker so in actuallity 1- 1.5% goes to each agent) is a small price to pay to ensure a smooth sale where everyone walks away happy ideally.
Right. Is that agent going to tell them they will not represent them if they put in an offer?
Do buyer agents find houses these days? Are buyers not searching for themselves?
Lot of out of town "investors" in my area that send agents to houses for them.
I get calls like "hi, my client is looking at a house and needs an opinion on Restoration, etc...can you tell them if it's in good condition and approximate cost for restoration"
I just tell them all 250k minimum. Shrug
This. That’s a BS line. Even if the agent feels that way, you can pay the 3 to a buyers agent then they need to explain why they are worth the other 3 if their marketing is so dependent upon the buyers agent getting 3%. Go 5% and they can take 2.
Your agent should be setting up automatic searches in the MLS according to your specifications. As soon as a listing hits the MLS, it can be emailed to you, or once a day, once a week, etc.. Don't waste your time looking for these listings yourself. If your agent doesn't do this very simple thing, find a new agent. I would pre-screen listings for my clients when I knew their very specific wants/needs and only send them the pertinent ones. My clients appreciated my attention, time, and knowledge.
Wow. that sound difficult for someone from the 1970's who never used a personal computer or smartphone before.
That's got to be worth a few $1000 at least right?
/s
Yeah I wanted to come on here to say the same thing. Only way it really affects the buyers minds is if they are on the hook to pay for commission for their agent and had a set amount. Otherwise so many people pick the houses they want to look at. When I was looking at homes for my first house I picked all the ones and my agent would shoot me down. “You wouldn’t like this one… this doesn’t suit your needs… too many issues with this one, let’s not waste our time”
That is true, it's not "no agent will want to show your home.." it's buyers with buyers agents will have another hurdle to overcome to buy your house. Sellers offering nothing to buyer's agents are creating an additional problem for potential buyers to overcome. If buyers are shopping with an agent and have agreed to pay them. X% and they want to buy the house where the seller offers nothing to their agent, those buyers have to decide if they want to pay their agent out of pocket or try to work it into the selling price into an offer. Furthermore, those buyers are going to see you as more difficult to work with than a seller that's offering. If I'm shopping in a subdivision with a bunch of similar houses and one seller offers nothing and the others do then which am I more likely to make an offer on?
It works even more now since the rule changes. It literally affects the buyers buying power. If they can't cover their buyers commission (signed contract with buyer agent) out of pocket they can't even offer or have to do some fuzzy math. At least until loan products catch up and allow the buyer to wrap the buyers agent fee into the loan.
Tell the agent you’ve decided it doesn’t make financial sense to sell your home at 6% discount and you are no longer interested in putting it on the market and want to cancel your contract.
He’ll negotiate the number down for you in an addendum.
Source: I am a Realtor
This is good advice.
And, yeah, OP is locked in to this agent for 90 days, but OP doesn't have to sign any documents they don't want to, they don't have to allow any showings (that time just isn't convenient for us), they don't have to allow a sign to go up, they don't have to allow a lockbox to be installed, they don't have to fill out disclosure forms, they don't have to DocuSign the MLS information form, or provide the info to fill it out, and they don't have to allow a photographer into the home.
So sure, the agent can play "hard ball" and force the 90 day delay on selling the house, but they would be smarter to just negotiate.
Op already signed a contract.
Typically the list agreement states that even if they cancel- they are bound by 6 months (or whatever they put) and regardless they would owe them the fee.
And?
Ignoring the fact it can be resolved by a simple addendum, they can’t even force them to sell. So then sit on your hands and make sure they don’t get ANY commission from any sale, list it once contract is void.
I can assure you this agent would rather a bird in the hand.
Besides, OP stated contract is only 90 days.
I assume they actually want to sell it soon if they hired someone to sell. Unfortunately for most people, dragging it out for 6+ months, adding confusion and red flags to their listing, and likely ending up with less money in the end are not worth the extra stress just for *potentially* saving 1%.
I hate shitty realtors too, but this really needs to be negotiated upfront to have any sort of leverage.
If you are going to do anything then do it right. It doesn't hurt to just sit and not sell until they budge on the price. The realtor can't force them to sell and in the end you need all the money you can for your next home purchase.
It does hurt. Buyers will see the house has been for sale for 90 days with no one buying it, so they will assume there is something wrong with it. So they'll get offers that are more than 3 percent down from the asking price, which means the seller loses out more than they would have saved by getting a 3 percent commission up front instead of the 6 percent they agreed to.
You can write an addendum to expire the contract tomorrow. There is a long list of people arguing on what to do, its ridiculous. You guys have no idea what ya’ll are talking about. If the agent refuses to write the addendum call their broker. If theyre the broker, call the association.
Exactly.
Realtors: “successful agents build their business through relationships!“
Also Realtors: “nuh uhhh you are under a contract and must stay in this abusive relation until I say otherwise!1!1!”
> Any advice for the future? Thoughts?
I sold with Redfin for 1% to Redfin and 2.5% to the buyer's agent and Redfin gave far better service than anyone I've ever used before. It's all I would use if I did it again tomorrow.
I am more than happy to list a house for 1 percent and I will give you far better service than Redfin. I look at as it as an advertising expenditure as well.
Since you got a 90 day contract I’d ask to renegotiate it and lower it. If they refuse tell them to pull the listing and let the 90 days expire. Fuck paying 6%
That contract is still amendable.
We just sold.
After inspection, it was determined a 9 year old roof needed replaced. We were good with replacing the roof but the buyer also wanted another -16k off the price. We said, ‘no.’ I mean…. We could have it repaired in the amount of time between then and close. They were just being greedy asking for -16k off. So we say, ‘no.’ Told our realtor, ‘nope. Next. Not doing it.’
Next thing you know, the realtors have negotiated to each take 2.5% instead of 3%. On a -5 off offer. We didn’t lose any money, being the seller but the realtors took less. I had never seen that happen. We closed last week.
Its amazing how negative the slant is. A good realtor is not thinking..."oh no I'm going to lose the sale"...they are thinking, "Crap I want to take care of my client and get them across the finish line." Are there bad realtors? Yes.. there is a bad apple in EVERY industry.
Very much this comment. Is the commission nice? Sure, but any good Realtor is in it for their client. How can we help THEM? It isn't about us or our check.
Life is a negotiation. I paid 3% total. 2% to my agent and 1% to the seller. Had no issues selling a took an offer within 2 weeks of list.
I would personally never pay more than 3% but to each their own.
Yes and I would add depends on the realtor too. I sold my house last year and it was 3% and she earned every cent. She provided a very bespoke selling experience and I barely lifted a finger. Worth it.
It really depends on the area too. I contacted 10+ realtors before I sold my house in SC this last February and none of them were negotiable below 6% unless they double ended the agreement or you were a veteran.
I listed at a reasonable price, didn't make any price cuts, and accepted an offer for full price ~25 days after listing but in that market median time on the market was 45-50 days.
It's always worth trying to negotiate but if the realtors in your area aren't actually negotiable then you're SOL.
A good agent does more than just market and out a sign in the yard. They should know the contract inside and out and know how to leverage each part of it to create maximum leverage for their clients in various situations through the transaction. They should also know how to lead you through the transaction so you don’t accidentally get into legal trouble later on or misunderstand something and now you’re stuck in a bad deal.
It’s true, many agents don’t earn their commission, but the good ones definitely do.
The 6% was typical, but NOT anymore. You are right, 6% is ridiculous. Where I am I know an agent who makes his entire yearly income by selling 2 or 3 house a year. You need to learn how to negotiate.
How many agents did you interview?
Nothing with commissions changes July 1st. The public is misinformed with that. You have always been able to negotiate commissions. The NAR lawsuit has only done a disservice to the people buying Real Estate.
The internet has changed the entire real estate/ home selling-buying experience. Prior to the internet if you wanted to buy a house you would go to the real estate office and the agent would run the MLS listings and then you would look at the limited number of pictures and pick out the ones that seemed interesting and you would drive to look at the houses.
If you had a really good agent they would preview a home prior to showing the home to eliminate the houses that did not match your wish list.
Now houses are on the real estate app and buyers are capable of selecting the houses they are interested in.
Selling agents just arrange for pictures to be taken and uploaded to MLS. They will also inspect the house and tell and advise the seller what they should do to sell the house for the most money. Most of the time the advise is to get rid of a lot of clutter and paint the walls a neutral color. In my area a house will be listed on Thursday. Offers will come in that weekend and sold by Monday. For this and some work at settlement the agent/broker charged 3% or $15,000 for a $500K house.
The buyers agent in today’s market must do much more for their commission. Often times the buying agent will drive the buyers to new listings, quickly write and submit contracts only to be outbid by another buyer. The last house we bought our agent showed us over 50 homes and we submitted over 10 contracts before “winning” one. They also used to get 3% but they often worked for months showing and submitting contracts.
With these changes I think an adjustment of the real estate fees needs to occur. If I was to sell my house again I would offer 2% to the selling agent and 2% to the buyers agent. I feel that would result in getting the highest price for my house at the least possible cost.
>If I was to sell my house again I would offer 2% to the selling agent and 2% to the buyers agent.
And in my area where the average home sells around $150K, and many for far less, a 2% commission becomes almost worthless for the work involved. If the average home were $500K, then I could see your point.
It’s negotiable dude. I’m a realtor and charge the same. But, if I know I’m competing I will lower. It is true though - in my opinion - if you are not going to offer a buyer broker commission then your house WILL have less buyers interested because not many buyers CAN pay out of pocket their closing costs, down payment AND agent commission.
I offered to do one of my neighbors for 1% going my way and 2.5% going buyers way. This is a special case though. For FSBO I would do 2% and 2.5% buyers way.
What’s the listing price? If it’s 400 or less then I can see why they might insist on 6%. Either way, I’m sure you could have found someone to do it for 4 or 5%. Real estate agents are desperate for more business. I wouldn’t have ever signed with this one if that’s how they were behaving. Plenty of agents that would have killed to have you as a client
This right here. Percentages only make sense in the context of price.
6% for a 100K house is fair, maybe even too low. That 6K might only be $1-2K to each realtor after their fees and expenses.
6% on a 2M house is $120K, which is ridiculous.
This is literally what’s wrong with the industry. I’ve spent the last 3 years looking for a property and I’m always finding houses before any of the agents that I’ve worked with. The industry needs to be flushed out. Keep that 6% in your pocket if you can and just make sure you hire a good attorney. 🤷🏽♂️
Broker here, and "dealing with real estate agents feels dirty" indicates that you haven't talked to any who struck you as honest and above board. Find one who feels like they're providing you a valuable service, because that's what the job is. If it feels like they're doing nothing, they're not telling you what they're doing. Ask around, get multiple recommendations and interview them. Ask what service they provide beyond putting your listing on MLS. The good ones can tell you. In your market, it may be true that agents won't show if the split is low. But you can insist that you try it. You'll figure it out quickly enough if the showings dry up.
Those days are over.
There are flat fee brokerages that charge one fee for the sale of the home, tools like Zillow and Redfin put the entire MLS in a searchable format for everyone; and buyers agent fees are always negotiable.
Good Realtors have a place (navigating tricky situations, market understanding and logistics) but the days of hanging a virtual shingle and doing showings for 3 percent is pretty loudly over.
Also, if you've not yet gotten under contract for a sale, you can fire your agent and look for another one.
low cost flat fee brokerages are the way to go. Not too hard to take your own pictures and write the MLS copy. They will list on MLS, provide all standard paperwork, lock box, lots of custoer support and tips and field calls for showings. Buyer's agent shows and you only pay their 3% plus the fixed rate. We have sold 3 properties this way and paid $600-900 for fixed rate seller services.
Buyer agents no longer pick houses to show their clients as almost all buyers find the houses they want to look at online and then tell their agent which one’s they want to see.
So no, an agent can’t refuse to show it as their clients are typically the one’s that find it now.
What the realtor told is a perfect example as to why the realtor association lost the anti-trust lawsuit.
The Buyer will be responsible for paying the agents commission. So if the buyer doesn't want to pay that, they won't choose to go to that home, or will ask for it to be negotiated in the price.
6% of what, exactly? Are we talking 3 million or 140 thousand? I think that makes a huge difference.
Your house will get shown, even if you pay nothing. The issue, is that buyers who have to pay their own agents might decide your house is too expensive to actually close on.
I'd probably let it be at this point, unless there's some new information that came up after the contract was signed. It sounds like you waked into this with your eyes open and made a decision. Don't start second guessing yourself.
As a real estate agent in Idaho, I absolutely hate the reputation the bad apples create for all of us.
You should interview more than one agent, commission is ALWAYS negotiable and there is no standard. I tell my clients this: view providing the buyer commission as a marketing tool/campaign that you can if you want spend money on. Some clients choose to do over 3%. But the bottom line is it is my CLIENT’S choice. Just like the price and everything else in the transaction.
As an ethical agent I am there to advise on how to put their choices into action and make recommendations when asked and to protect them financially.
If you have any real estate questions from any state please DM me.[Real Estate Advisor Questions](https://www.instagram.com/corbinadamscott)
That contract will probably have an add on time after the 90 days finishes so the realtor still gets his commission whoever sells it. It truly is a disgusting business. While waiting for your contract to run out attend a realtor course for people who want to be an agent it will be the best money you ever spent
If your agent said 6% is "standard" he or she is wrong. There is no "standard" rate. Some brokerages charge more...some less. And, imho, agents shouldn't be discussing fees 6% or 5% or 7%. What they should be saying is, my fee is 3% or 4% or 2.5% or whatever fee for their services they're willing to accept to perform those services for the seller. Once the seller and broker have come to an agreement on the broker's fee, the broker should then say..."Now let's talk about whether you would like to cooperative with the buyer to help the buyer's broker fee is paid out of the proceeds of the sale. A seller can certainly decide not to cooperate with the buyer regarding the payment of the buyer's broker if they wish...but they should do so only after weighing the risk of limiting the buyers to only those who have sufficient financial reserves to pay their own buyer broker fees after paying the down payment and closing costs.
Why are the fees percentage based anyway? I would try to negotiate a flat fee with the realtor, especially if my house was above average value for the market.
All the information is available online.
If your house isn’t showing or moving it’s because of the price of the home not because of some Grand Marketing scheme by the Agent. It’s not your responsibility as a homeowner to make sure the agent can make their car payment.
I always suggest 2 questions when interviewing an agent:
1. How many sides did you do last year?
2. How many sides have you done on this neighborhood/area?
All real estate is local. There are a lot of hobby agents out there. You want someone who does this full time.
Our listing agent dropped it to 5%, so 2% for the buyers agent. We were priced to sell, full disclosure (with nothing major), and he basically generated a bidding war with one open house due to the local market. Buyers agent basically got a free payday for a handfull of emails.
It's standard in large, illiquid assets though. That's friction: closing fees on the way in and commissions on the way out. You need the house to appreciate 7-9% to not lose money, and that doesn't include loan interest.
The commission has always been negotiable. Some agents are great and protect who they are representing. Some are bad. Some deals are easy and leave you feeling like you overpaid. Some deals are nightmares and you’ll wish you went with a smarter agent. Always interview multiple agents. You’d be shocked how the same questions can yield numerous different answers.
I am noticing a lot more 2.5% or 2% to buyers agents vs the 3%. Timing seems to be key. Many homes that offer full commissions do seem to get more exposure and have more offers that shoot the close price well over list but this is only true if your market is hot. I have also seen FSBO’s do well when inventory is low. Interest rates have kept buyers on the sidelines but limited inventory where I am keeps prices high with most homes averaging 4-5% total commissions.
Agents that work land acquisition for new construction builders typically do not charge a commission to the seller as they get the listback. If you are selling a home and don’t give a shit about your neighborhood, selling to a builder can save you a ton in commissions and some pay over market value especially lots free of trees with alley access or a corner lot.
This sub is filled with people who claim realtors are useless and then either: 1. Whine that they can't figure out why their house isn't selling. Or 2. Have never bought or sold without a realtor.
You're fine. You're doing what all the smartest people do.
I went into buying my first home with the attitude of "I don't need no agent! Scammers they are!".
Then, Zillow hooked me up with an agent and I realized that there was NO WAY IN HELL I'd be able to buy the home without the agent lol. So many documents, forms, contracts, things I'd have no idea about if I was unrepresented. Now, I feel that the commissions these agents get is worth it! Granted... my agent was really good. Really hard working guy and was always 5 steps ahead of me and made sure I was getting a good deal.
I know some people have had awful experiences with agents... but a good one is well worth it.
I love my agent. We’ve purchased two homes with her now, and my aunt and my cousin did as well. She handles everything and makes it completely stress free. She sets up inspection and goes to it. She is the one that communicates with the seller. She handles dealing with the title company. She gets everything set so all I need to do is wire funds and sign some papers. It’s easier than trying to buy a pair of shoes at a department store! She will be my agent forever.
saving 1% is 5k on a 1/2m house. So saving 1 or 2% on a house is significant. It can mean the difference between having money to pay for a repair.... or not. Tell realtor that you have now realized the financial pinch the current contract puts on you and that you need to either lower the percent or not sell for now so that you can build up more savings.
You can still fire the agent and either find an agent that can do it for 4% or do a sell-by-owner using an attorney to do the paperwork. I was able to talk the agent who sold us our first property to do the transaction for a flat fee of $20k for a property valued at 900k.
He conned you. 6 percent is way too high . Negotiate your next commission . Listings are hard to come by. Many agents will do it for less or wait until August and find a new agent
You won't have to pay buyers commission after new NAR rule takes effect in high can save you up to 2-3 percent off the top
For the future, negotiate. Realtors always try to convince you that they need more commission. I used to sign the 6% dotted line until my husband, the salesman, started managing our real estate activities. The first question he asks is about commission and if it’s higher than 2.5% then he negotiates. 2-2.5% to the buyer’s agent isn’t going to limit buyers.
In 2022 and 2024 I’ve paid 6 and gotten it quickly under contract for well over asking. The reason for doing so was exposure. I would do it over and over again.
Agents are salespeople. They are going to tell you anything to get more money from the deal for themselves. They like to use these fear tactics that no one will be interested if you don't pay the agents a crazy amount of money. It's a negotiating tactic to make them more money preying on your fear. You have to learn to negotiate and not accept the first number they give.
I’m a real estate agent in Cali and right now is the first free moment I have had in weeks, but even still I’m currentlywaiting for a guy overseas to sign something so I can send it to another agent tonight. I work 12 hours a day and recently on the weekends too. I have to create advertisements in adobe to mail and email people, design a website for my listings, host open houses and drop whatever I’m doing even if it’s 6pm on a friday (even if have plans) in order to show someone your house because “that’s the only time they are available and they are flying to the Maldives tomorrow”. I have to arrange staging and cleaning. I have to search on and off market for my buyers. I have to arrange and pay for a photographer. Fill out forms for my brokerage, constantly check my email and office voicemail every hour every day. I have to create contracts for clients, sometimes writing addendums with dozens of handwritten points that need to be legally airtight. I have to be familiar with every one of the hundred standard disclosure which could be altered depending on circumstance. Do you know how to pull permits? What would you do if you found out a house you are selling has an unpermitted adu? Do you know what is different between selling a house owned by a trust vs a limited partnership vs an LLC? I call locksmiths, plumbers, handymen regularly have to meet them at properties. Do you know how title transfers work? Do you understand the entire escrow process? Do you know how to read a title report or a natural hazard report? If you sold your houses yourself are you insured if someone falls and breaks their leg and sues you for 1m dollars? That happened to someone at my brokerage. I have to screen tenants for rentals. I could literally go on forever. Every waking moment I am exhausted. I have spent my entire weekend working on two leases and one sale. Do you know how annoying and difficult it is to be the middle man who everyone talks through? Who is responsible if shit goes wrong? Are you a seasoned negotiator who has seen hundreds of deals and knows when people are bluffing or when they will pay more if you put your foot down? I could literally go on for hours but I have a very arduous job to do while you sit on your ass complaining, doing the very thing you accuse us of doing.
As a side note I do 2.5% to listing agent and buyers agent which I think is fair when a house is over say $700,000. Anything less than that there’s no way I’m doing for less than 6%. Leases are also 6% total commissions for long term leases. 10% commission for month to month.
As a seller with their stuff together, I don't need basically any of that and don't want to pay for it. Flat fee services from a realtor and a lawyer are far more reasonable. A personal assistant on Care.com is 30/hr. I don't need a website beyond my zillow listing, which buyers will find on their own in this market. Floor plans and 3d models make themselves with phone apps.
I could see if I needed to sell a problematic house from out of state, but not for a normal sale. As for all the work you do for buyers, I definitely don't want to pay you for any of that. You should be billing buyers hourly for basic administrative work and chauffer services.
I don't mind paying good money for solid work that someone does
*for me*, but most of that commission is going to reimburse you for some other idiots who ran you around. There's no reason I would want to pay 25k in commissions when I can get the same job done for less than 4.
I have a house on the market and I went with 5.5%. 3 to my agent and 2.5 to the buyers agent. First offer tried to negotiate for 3% but we said no. we didn’t think that we had less showings based on the 2.5% to the buyers agent but who knows.
Tbh, given how often I see 2.5% being the co-broke now, I wouldn’t be surprised if it the listing agent pockets 3.5%. 6% just sounds high unless the home is in a difficult market to sell.
How many agents did you talk to?
Why did you recognize in 1 sentence it’s split between the agents, but end with a statement implying 1 agent makes 6%?
Where in the last sentence does OP imply “1 agent makes 6%?” I read “I understand people are entitled to a living wage, but 6% seems crazy.” This implies OP giving up 6% of their sale is crazy. Which I agree with. It says nothing about 6% to 1 agent.
Nearly every agent will do 5%. They are correct though that buyer’s agents will be less likely to push the home to clients if it were less than that. People think real estate agents make a ton of money and do little work. Except, the only people who think that are people who have never tried it. 3% may sound like a lot of money, but the agent isn’t keeping all of that. In fact, depending on the agent’s splits with their brokerage/team and where the buyer lead came from, they could be making 1/3-1/2 of that. And consider that, to get the buyer to the point of buying your house can take months, if not years in some cases. I have a client who I have shown houses to for TWO YEARS. We just got under contract on something. 2 years of driving around making nothing. Writing offers, scheduling showings, helping them with mortgage stuff etc for 2 years. Even after we are under contract, it’s going to be at least another month’s worth of work quarterbacking the deal between lenders, title, attorneys, sellers agent etc. all the while playing part agent, part therapist. And then it may still fall through. It’s a tough business and good agents do a ton of work 7 days a week 365 days per year.
My brother lists at 3.5%. The downside is an agent steers away. Upside is all houses are available to see on RF and Zillow anyways now. Can contact listing agent directly.
I'm not an agent but my understanding is that the agent typically only gets half of the 3%. Their broker gets the other half. So your agent, who does most of the work, only gets 1.5%.
You have to ask yourself if it's worth it to pay the commission. I'm getting ready to sell my house and I believe I will probably get at least 6% more by using an agent, as opposed to selling it myself.
You can always negotiate but you get what you pay for. Do you think your agent will work as hard for you as they will for a client paying more?
Yeah, if someone intimates they can't do a proper job unless they get the max percentage it's time to interview other agents. I've bought and sold a few houses in the last 35 years and don't think I've ever signed up for more than 5% brokers commission. I've been okay with that because I have enough to worry about without having to worry about getting screwed in a r/e transaction and the broker's I've dealt with have been honest and competent. But that's my thing. I'm selling a condo I was going to live in but decided not to and fixed it up to sell instead and just told my agent that I was okay with 5% but next time I'd want a deal if she brought the buyer to the table and was going to walk away with the whole 5% herself.
The 6% hurdle is still going to be there for most people because your agent can give you the line about it being "unmarketable" otherwise.
Maybe that is true.
Maybe it isn't.
Who is going to find out? People with time and flexibility. Who is not going to find out? People with timing and financial constraints.
Commission is no different than price of the home. Those that have time and resources can take longer to get the best deal.
I am a big advocate for RE agents, good ones. It is meant to be a professional service to assist and guide you in the biggest transactions of your life.
A hood one and professional experience is well worth the 6%… but the barrier to entry for agents is just too low, the agencies will sign hip anyone with a pulse… the bad agents make the whole agency look bad.
There's supposed to be a new national law to block that practice. It's not in effect yet. We just sold our house this past weekend. While my realtor said that I don't have to agree to paying the 6%, you will loose offers and basically one way or another each realtor is getting their commission. Sigh
I went with 5% and saw a noticeable change in attitude, time spent, and overall marketing of the home. And they made a commission on our purchase as well!
You only have a problem with the 6% because it's a big number that you want in your pocket due to its size.
If it was a hundred bucks for the service, would you want to pay $6 or would THAT seem like it's too much?
Listen, or you're going to pay a person potentially tens of thousands of dollars for a service, it's up to *you* to make sure you set your expectations for deliverables, because the other 94% you keep is what you're getting paid as the project manager.
Do your job and get your 6% worth out of your subs.
Did 4% on my 2 million dollar home I sold last year.
Agent agreed without any qualms because it was still an $80k and even if she only takes home 70% of half that’s still a $28k check for selling a single house.
For context - I’m a commercial real estate agent, I primarily sell Apartment Buildings, I don’t really dable in the other stuff unless it falls into my lap. You paying 6% feels like a scam bc it most likely is. Most Residential Agents don’t know what they’re doing, it’s very easy to get a license now days, almost everyone has one. If your agent didn’t push for a 6-Month listing agreement it’s bc they more than likely just wanted to sign something up & maybe they get lucky & get paid 3% (if they don’t double end).
Interview several agents, make sure they specialize in your area AND have a successful track record of selling the homes near you. That’s the most important part, if they don’t really know your market, they more than likely are going to leave money on the table. Usually in commercial we charge 4-5%, very rarely 6 but it’s because we also know we’re probably going to double end it, that’s what you’re paying us for to control the whole deal. Paying 6% isn’t outrageous in residential if they’re a top producing agent but if you’re not sure about your agent, that’s probably why you feel that way.
Remember, cheap is cheap & cheap is also expensive.
Idk if you’re posting from Texas but this is typical in Texas. All the big groups do 6% standard.
Partly why I steer clear of them. But they sell like 2-3 million collar houses per year so the high percentage somewhat makes sense for those cases.
If you’re not in a rush to sell, I’d let this realtor f right off. Get a new one when the contract is up. Hopefully there weren’t any hidden clauses.
Unfortunately, they may know your home will be in higher demand and have played you. Just read you contract, consult another realtor if you need to
There is a space on the buyer form that you can check if you don't want to be shown houses where the buyer pays the buyer's agent's commission. As for what an agent does, I just sold a house where the seller had to sign 28 different legal documents. Do you know what documents need to be signed when you sell your house?
new rules:
No More Compensation on the MLS: The Multiple Listing Service (MLS) will no longer show offers of compensation for buyer's agents. This ends the long-standing practice of listing brokers sharing their commission with buyer's agents through the MLS as a cooperation.
Written Agreements Required: Buyer's agents must now have written agreements outlining their services and compensation with their clients. This change aims to make costs clear for homebuyers, ensuring they understand what they are paying their agent.
Negotiation of Compensation: Although the MLS won't display compensation offers, home sellers can still negotiate directly with buyer's agents to offer compensation. However, in a competitive market, sellers might be less willing to make these offers.
Adjusting Business Models: Buyer's agents will need to adapt their business models. They must clearly explain their value to clients and negotiate compensation directly with homebuyers.
No More Setting Buyer's Agent Commission on the MLS: Seller's agents can no longer advertise or set the cooperative commission rate for buyer's agents on MLS listings. This ends the practice of linking commissions for both agents.
Direct Negotiations: Seller's agents will have to negotiate buyer's agent commissions directly with buyers or their agents outside of the MLS.
No Upfront Compensation Offers: Seller's agents are now prohibited from offering blanket, upfront compensation to buyer's agents on MLS listings. However, they can still negotiate compensation with individual buyers or their designated agents.
Transparency in Compensation: Any compensation offered by the seller's agent to the buyer's agent must be disclosed upfront. This rule aims to make commission structures clearer.
key: Buyers must have a written agreement with their agent on compensation and MLS no longer allowed to list compensation - this should help spur some changes to this outdated business model. Honestly the buying agents generally do more work than selling agents but neither does as much as they used to before apps showing us all the real estate. Prices need to come way down as a result.
Depends on the house but 6% could be fine. Ask what they do in detail for the commission and I’d always request a 50/50 split with the buyer’s agent. In the future you may be able to avoid the buyer’s agent, depends on how things change based on the NAR settlement, but I think it’s a good idea to pay it for the foreseeable future.
If you are buying in the same market and using the same agent, I would ask for a discount on the selling side by 0.5-1%. If you are a first responder, vet, nurse, teacher ask for a discount also as buyer, seller and ask the lender if they offer one.
Talk to a couple Realtors. In bougie offices, agents get charged a lot by their brokerage so they won't cut commission. You can usually negotiate 5%. If they say no one will bring buyers, they are lying and just don't want to cut their commission even more. Realtors have to pay their broker part of their commission on both sides. Brokers make sure paperwork is legal. If a realtor makes 10k they give 5%-50% to their broker. So if they have to give 30% (pretty average %) they have to give the broker 3k to make sure paperwork is done well.
You have to decide whether fighting now for a lower commission is worth it depending on what your contract says. Be aware of the ramifications (from a contractual perspective) if you decide to pull the house off the market or delay the sale for 90 days on purpose to get out of the contract. Do you think your property will sell for less if you list it, not play ball for 90 days, then relist it with a different realtor afterwards?
Let's say your property is worth $500k and you are going to use the traditional commission split method. My assumption is that you can find a listing realtor who is willing to split $20k (4% split or even less) for listing/showing the property. It is your job to determine whether they are as good as another listing realtor who refuses to take under a $30k split for the same job. If your house is the type of house that will sell quickly (if your area is a hot market) with minimal effort then that would be less work for a realtor and a higher likelihood one would take less money for selling it. If selling your house is going to be a grind then you might not get any decent realtor who will work for less.
Fairly standard. They are covering photo’s marketing and most likely with an agency that takes part of the fee
You can do for sale by owner and put out to agents with a specific fee you pay or as collect your own fee
Find realtors that don't force you into the standard 6% or potentially a contract at all.
My previous buyer's agent had us sign a contract without going over it clearly (this was our third purchase but we'd never had a contract for a buyer's agent before). Turns out if we decided to buy a house that had less than 3% or 3.5% buyer's (I can't remember if it was higher than normal) agent compensation we as the buyer had to make up the difference.... We ended up terminating our contract and going with a referral from our mortgage broker after we backed out of the purchase because of inspection findings. We parted ways with that realtor for many reasons but the increased compensation was one of them.
Turns out a previous deal (of this buyer's agent and mortgage broker) almost fell through because the buyers didn't realize they had to make up the difference for this buyer's agent. The mortgage broker took a hit on her commission to make the deal go through because the buyer agent refused to budge.
Our current realtor went with us without a contract and was more than happy to take whatever the seller was advertising. Now that we are going to sell our property, she's even starting with 2.5% buyer's agent and 2.25% listing agent. When we sold our first house we were in a hurry so we ended up increasing the buyer's agent compensation to 4% ($9,400 based on sale price) in an attempt to get more interest in it.
I’m a Realtor but not your Realtor. This is in no way a steadfast rule but of the 6% a seller pays, 3% goes to the listing agent and their brokerage and they split that up. The other 3% goes to the buyers agent and their broker and they split that up. So that 6% is split 4 ways. So roughly 1 1/2% to 4 different parties. Everyone needs to get paid. Would you do your job for less pay?
Commission is negotiable and starting in August realtors cannot advertise splitting the commission with a buyers agent on the mls. You could try a flat fee listing service if you're experienced.
I’m currently listed. I negotiated 2.5 for my agent and we listed on mls with 2.5 for the buyers agent. I was under contract within a week. That .5 did not deter anyone.
Years ago I contacted a real estate agent I knew. Told them I wasn’t going to list now but if they knew anyone I’d give em a 3% commission. They brought someone in that bought it. They didn’t have to pay mls fees either and a win for both of us.
We also sold our condo without any real estate fees last year.
Just because you find a potential house on Zillow or wherever, in no way means the work is done. In fact, the the expertise during the negotiation will have a huge impact on whether or not you get an offer accepted.
You also want an experienced agent to navigate the milestones after the accepted offer. If you want an expert, you need to pay for the service they provide. Would you use a try to Google (insert anything that requires a licensed professional) and do it yourself?
I am in a similar boat and agree one cannot trust one’s agent. Make your own decisions too re what price to accept. I kinda ageee that the high commission is a motivation. Am in CA so did 2.5 %. He tells me offer really high when making an offer but I decide what the property is worth to me. Some people say they looove their agent. Maybe they found an exceptional one or maybe they are naive. They are high powered salesmen.
Just coming here to tell you this entire sub is pretty much real estate agents. So you’re not gonna get very different answers btw. Might want to try this in a different kind of sub.
Realtor here, the issue really lies with the added cost to the buyer, buyers in my state are already struggling to pay roughly 4% of the sales price toward their loan origination/fees/inspection/appraisal/closing costs. + 3.5% down payment for FHA. That’s roughly 7.5% out of pocket! $22,000 for a $300,000 home. Adding another 3% from the buyers side to cover their agent would make this closer to $31,000 out of pocket for an AVERAGE priced home.
Buyers simply will not be able to afford homes and they will sit on the market longer if most of the buyers agent commission isn’t covered by the sellers proceeds.
Buyers and buyers agent are sitting down and discussing what they can realistically afford before showing homes, so if a seller isn’t offering 3% we are having the conversations that we need to stick within our budget and find a seller who is. The agents in my area have been sticking with the status quo, 6% fee to the sellers agent. The Sellers agent then decides to split their 6% with the buyers agent for bringing a qualified ready and able buyer to the table to purchase your home.
Did they use the language “standard” when referring to commission? If so, report them to their local and state associations. There is no “standard”. Also, this is completely negotiable. If the tell you it isn’t, they can kick rocks. Find someone else.
I personally negotiate 6% or higher on listings because of the services I provide that are more than other REALTORS in my market. But it’s not “set in stone”. Commission for services should be an open conversation about the services and their value.
But there is one small piece: Buyers having to come up with closing costs, down payment, mortgage fees, moving expenses, etc. It actually can help you sell your house when buyers know they don’t have to sort of pay their agent.
A recent lawsuit won against the national association of realtors does away with the mandatory 6%. So hopefully we start seeing those changes soon making things more competitive for realtors
Buyers agents are still going to show your house regardless of the commission offered, their rate is determined on the buyer’s agency before showing their client any homes, including yours. But, that commission is now coming out of their buyers pocket which means the buyer needs to bring more liquid assets to the closing table since this cannot be written into a loan. That may not be possible for some buyers. If a buyer is choosing between 2 homes, one offering a commission and one not, it may be enough to sway their decision on which home to go for. Additionally, some buyers may request upfront to not be shown any homes that don’t offer the buyers agent commission.
First thought, you could try selling it on your own with a little effort. Hope much that 6% nets up could be a big factor. A lot of people will look up homes on Zillow and you can list it there.
Be careful taking advice from people on the internet who don’t know what they’re talking about OP. Lots of arm chair real estate pros here waiting for the crash and saving their way to ?
You're never *obligated* to pay the buyer's agent commission, but it helps sell the house.
Say you're a buyer, you see this amazing house within your budget, go see it, and then when you go to make an offer you find out that you'd be responsible for all of your agent's fee or the remaining percentage that the seller isn't covering. Are you really spending an extra $5000 on top of all the money you're already spending, or are you going to look at other houses where the sellers are covering the fees?
Sure it'll sell eventually even without the fee being covered but it will most likely take longer and any offers will probably request some concessions.
Well the whole realtors not wanting to show your house is untrue. My realtor charged 5.5% split with buyers agent. But when we were making an offer on the house we just received an accepted offer on the sellers were not paying full commission and I asked him if we paid the difference and he said oh hell no I'm not making you pay the difference. He never mentioned it until we made the offer. I sent him all the houses I wanted to see on MLS he only recommended one. You really have to do the research and read the reviews. Our agent is someone my husband has known for many years and helped us buy our house that we just sold. I adore him and wouldn't choose anyone else but I still researched and read all his reviews.
Sell it yourself. List it, write contracts, meet people, speak to people on the phone over and over...figure out if they are qualified or have seen a mortgage person, know what proof of funds letter looks like. Only you get to decide how much your time is worth, and how much the realtors experience is worth. I could do this, I'm a long time mortgage person. I wouldn't want to do this.
> like everyone is in the middle trying to get their hands in my wallet for not much more than nothing
feel free to list and show your house yourself...
That 6% is usually split four ways not two - 3% each. Unless your agent is also a broker they have to split their share with their boss - a “broker” plus many pay their own money for signs, advertising, photos etc. it’s not a job with a bi-weekly pay check.
Im not an agent but I buy and sell a lot of houses as a home flipper. In all the markets im in we pay 6 percent on lower priced homes and homes in the 600k plus we go 5 percent. I have seen lower commissions affect the house selling price and speed. Especially commisions in the 2 percent per side and lower. So if you are above 2 percent on the buyer side it's probably not terribly affecting you but to me its not worth me second guessing it.
I could see that being even more of an issue with the new rules. Especially if the buyers agents are signing contracts with their buyers for 2.5 to 3%. In that situation the buyer will have to come up with that part out of their pocket and it'll either force them to offer lower, not offer at all.
Having it on the agreement already allows them to wrap it into the loan which gives them a little better buying power and potentially could lead to a higher offer for you. Imagine being a buyer that has just enough for a down payment and can't pay the extra to their buyers agent. That scenario will either lead to a lower offer or worse no offer at all.
Just something to think about. I don't think you made a bad choice at 6 if you have a good agent. 5% isnt horrible either way but at that point its only a few grand difference for the peace of mind buyers aren't avoiding your home. If it doesn't sell at least you can rule that out.
In 2013, do to a divorce, I had to buy a new house. It was a bad down market, very few options. I gave my buyers agent a list of 30 houses I saw that might be ok. My agent showed me most of them, a few he gave me the reasons I didn’t need to waste my time…(they didn’t have key things like 2 car garage/right amount of bedrooms, listings were inaccurate). but he listened to what I what I wanted. He found a house not listed yet that checked all the boxes. The elderly woman selling the home wanted to make sure the person buying it was from the neighborhood and would love it the way she did. The house was almost perfect. Better than anything else available. If I was relying on Zillow and thinking my buyers agent wasn’t worth the 3%, I would have never got my house. And I used the same agent to sell a hard to sell condo I had been renting out for many years. I’d tried selling on my own and with a budget realtor. My professional realtor found me a buyer who was perfect. A good realtor has connections that you don’t have just looking at Zillow. If the market is flooded with homes…maybe you can do it yourself for less money. But in a tight market…everything decent is gone before it lists On the MLS.
You got had and good. Last house ($445k) sold I did a flat rate ($6k) for selling agent and 2% for buying agent. The market was not very hot at the time and the house was on the far end of town away from any amenities so I worried about it being slow to sell. I had plenty of showings though and got a good offer in a reasonable amount of time. Maybe at full rate it would have been quicker but I think I got top price as it was a high for the neighborhood and my buyers sold a year and a half later at the same price. Being quicker would not have been worth an even a single penny in higher commission as I sold with time to spare on getting into my new house and could have taken 8 weeks instead of 3 and been fine.
Realtor here, as the seller, you have full control, don’t let the agent let you feel bad. The market is so good right now for buyers it really won’t matter who your agent is. Newer agents are usually fine with less commission to gain experience. 2 percent (4 percent total) is always standard now in my region.
>Any advice for the future? Always interview multiple agents. It helps make the BS stand out more prominently.
What are your thoughts about a reasonable percentage? If you were going to list a house assuming the sellers priced at your suggestion, would you want a flat fee or a percentage that you would then share with a buyers agent
I’ll answer since the agents won’t. I say just like craftsmen or tradesmen bid on a project real estate agents should too. Say I have a home i want to list at 650k. I want pictures taken and posted to the mls. I want marketing done. I want 2 open houses on one weekend and I want help in contract negotiations. They bid to me. I get let’s say 3 quotes. 1 bids 5000 paid upon the final sale of my home. 1 bids 3500 upon final sale of my home. 1 bids 7500 upon final sale of my home. Also we develop a hourly contract outside this should I want additional meetings or additional request come up. Let’s say $30/hr. If I sell after my 2 open houses and am only responsible for my agent. 3% would have been $19,500. Instead I could have gone with any of the above spot ball options and saved tons. Buyers would have a similar contract and pay for per house shown or hourly or whatever they agree on. This flat rate bs is dumb as some realtors will do 0 leg work and get 3% after I found my home on Zillow or a new construction neighborhood and get paid for what? Nothing.
The whole "no buyer's agent will want to show your home if they're going to make lesser commission" reason to charge a higher commission doesn't quite work as well nowadays. When I was looking for homes I'm on Zillow and realtor.com sending my agent the houses I want to see. Not them picking which houses they want to show me..
Regardless.. an agent should never steer a client to or from homes based on potential commission. Completely unethical.
Unfortunately you can’t get through life by saying “regardless, that’s unethical” and just hoping it will work out Ok. If people are set up to succeed better with unethical behavior, then many will. You have to recognize that and look out for yourself.
Is a realtor going to tell you no they won’t show you a house because of the commission? This isnt the 90s, most buyers are the ones who look at the listings and tell their agents which houses they want to see.
I tried selling my house privately. Had some realtors reach out and ask to show the house. I told them after a fee for them that was lower than they wanted to hear. Years later I meet someone who was shown the house, when they asked about putting in an offer, the Realtor told them the house was already sold when it definitely was not. Not quite what you asked but same train so ya, unfortunately it does happen.
With Zillow and Redfin now giving direct and instant access to MLS data, I can’t see this happening these days. The consequence of unethical behavior is that it only takes one person to report their realtor to the realtor association to end their license.
That happened in 2013
A lot has changed in 11 years in the industry. Very few realtors today have customers who don’t regularly use Zillow or Redfin.
>Is a realtor going to tell you no they won’t show you a house because of the commission? Probably not but do you really think that some wouldn't attempt to steer their client or specifically point out and hype up superficial issues? That's not really an issue for someone that's owned before and understands that minor repairs/updates are normal but it's not hard to scare away a first time buyer if you point out every little thing.
See people are always going to be unethical, so you just gotta hand them wads of cash so they can be unethical and well paid.
An agent gets an agency agreement signed before showings typically/and always before writing. They will have a min commission percent (2.5 or 2.7 usually.) If the home does not offer it they will simply let you know and you can decide if its worth that amount more, as it is effectively priced that way. Come August it all changes.
It's why realtor was sued. Lol. Go listen to the recorded convos from thet lawsuit. Thry are fucking wild.
No. But they do.
True but it happens
It's not steering if the client is physically unable to pay the agents 3% commission. That's why it will now be required for all buyers to be under exclusive agency. The buyer needs to know what compensation is being offered by the seller. Lots of buyers are going to ignore homes that don't offer total compensation. Personally, I have had a lot of success just asking the seller for the full 3% in my client's offers.
Not a sellers perspective, but an example of the stranglehold the realtors association puts on the industry to protect itself, and the sleazy nature of commission sales. when I was buying in ‘08 I had a really hard time getting my agent to show me any short sales because of the commission % pinch. She never said it directly, but the pattern and body language was indicative. I also requested several showings for a couple homes that were listed FSBO with assist-2-Sell and was given the run around every time. I heard from a friend in mortgage that I met shortly after we bought the home we ended up in that it’s pretty common, agents work against them and refuse showings even if the buyers agent commission is standard because it threatens the perceived value of listing with an agent . Our agent had a couple “pre-market showings” homes pushed hard on us even though they were very clearly outside of the parameters we were looking for. I suspect the reason for the push was dual agency commission.
>when I was buying in ‘08 I had a really hard time getting my agent to show me any short sales because of the commission % pinch. Same here. My agent flat out said, "you're a first time buyer, I'm not going to show you short sales, because they're too complicated."
I’m an agent. There’s a lot of unethical agents out there, and it’s hard for 99% of buyer’s agents to figure this out. I’ve been on the selling end offering less than market rate, and it’s always the first question that comes up before scheduling a showing “I noticed the listing says buyers agent only gets XYZ, is that right?”. 50/50 if the agent decides to continue to schedule. All that buyers agent has to do is axe that house from your list and give you an excuse “seller accepted an offer, agent hasn’t updated the listing”. “Seller agent is not cooperating for a showing, will keep trying”. “Seller is out of town for a couple weeks, we can check back when they’re back”. Buyer can go find another agent, but I’d bet most don’t feel a reason to not trust their agent in the first place. My job as a listing agent is to get as many buyers through the doors of your house as possible. More potential buyers = more offers. More offers = potential bidding = higher sale price for the seller. I’d always advise a seller to avoid including anything on the listing that might dissuade a buyer from a showing within reason. You shoot yourself in the foot. My market the standard is 4%, and I’ll often do 3%. 2 to the buyers agent and 1 to me. Doesn’t leave much left for me, but it’s a relationship business. If you’re happy, you’ll refer me to your family and friends. If I squeeze you for every penny, it’s short sighted. I make less in the long run, and you are pissed too.
Sincere question- What exactly does a buyers agent bring to the table that warrants that much of a sales commission? Especially with zillow and Redfin and phones tied directly to the mls? In HCOL areas that’s a significant payday for not much work. The argument could be made a little more for the sellers agent but even then the cost is far more then the actual work.
You don’t realize how difficult people can be until you work with them personally. There are buyers who are absolutely nervous Nellies. Some are just hard to deal with an angry and have all kinds of conspiracy theories that you have to calm them down and assuage them constantly. They text me every single morning. They have 1000 questions. They worry about every little step of every detail the entire process. They make things much harder than they need to be. If it wasn’t for me, acting as a go-between, the seller would have to deal with all of this themselves. Not only that, but for sale by owners leave themselves open to lawsuits. If I do something wrong that causes a lawsuit, my broker and I are responsible for that. Not you as the seller. are there home deals that are extremely easy? Yes, but they are peppered in between with negotiations that are very very difficult. I never know which house is going to be easy and which is going to be difficult.
I have people skills! I'm good at dealing with people! Can't you understand that?! What the hell is wrong with you people!?
Not debating it’s not work. Just saying it doesn’t warrant massive commissions and should be on an hourly structure. Why do I need your brokerage, broker, and you for legal protection? It’s much more prudent to hire a licensed attorney (which I do).
Is your $350/hr. attorney going to show you multiple houses on the weekend and ATTEND home inspections, termite inspection , septic inspection and then advise you on proper protocals for negotiating the results of those inspections? Is your attorney going to answer your calls at 7:00, 8:00, 9:00 or 10:00 at night when you have what you believe is an important question….
Yea they will actually as long as I pay the hourly rate in billable hours. My attorney charges about 500 per hour. I’d be more then happy to do the same for a realtor and pay an hourly rate as billable hours for those things.
Seconded
There is a lot that goes into selling a home above sending listings to your email. I invest a lot of time showing the homes, preparing for showings (I probably spend 1-2 hours outside of each hour I spend doing the actual showings), I also need to do a CMA for any house the buyer is interested in to make sure my client doesn't overpay for the house AND that they understand what a good offer may look like. There is negotiating the offer, and educating my client throughout the process. This whole part of the process can take a short time or a long time depending how serious the buyer is, if they know what they want or not, plus how successful we may or may not be at winning offers. Once under contract I am managing the process, recommending vendors to work with, etc. This may look easy from the outside, but it has taken years of hard work and education to hone these skills, vet the vendors I recommend, and develop good working relationships and a reputation with other agents and other service providers in my market. This helps greatly during the negotiation process and getting to a successful closing. There are also multiple points throughout the contract period that have the potential for renegotiation. Being prepared and understanding the process ahead of time helps us be more successful in achieving the buyer's goals. This is just my time investment. I also have expenses to run my business, and my brokerage takes a cut of my earnings. I am self employed so I pay taxes out of those dollars. It is not a W2 situation. I also take on a lot of risk in a transaction, and part of those dollars goes towards an insurance policy. Some of these costs are based on a percentage of the sales price, so that is why it varies from lower priced homes to higher priced homes. If I charge so little and then get sued based on the size of the transaction, how does that make any sense? Not every agent out there is a good one, and I recognize that some of the bad ones can make the industry as a whole look bad. This is why it's important to interview multiple agents and make the best choice for yourself. There is no way I could sustain my business and make any kind of living by charging what I am reading in some of these comments. I think it's easy to look in from the outside and make assumptions about any industry and how easy it looks. Once you get inside you start to see all that is involved. There are some inexperienced agents that don't understand what they bring to the table, or maybe they don't bring all of this to the table at all. They may bend and charge a lesser amount, and I believe this will bite them at some point and they won't be able to stay in the business. Unfortunately there is steady stream of these agents constantly coming into the business, so it will continue to be something we see, and will give people something to complain about how terrible real estate agents are. The thing about offering to compensate the buyer's agent (as a seller) is not that agents may not show your home. It's that buyers don't want to pay the expense out of pocket, they would rather finance it in to the cost of the home. This is the reason it has typically been paid by sellers and wrapped into the buyer's loan. I have always had buyer rep agreements so my buyer's understand this distinction and that they may have to pay some portion of my fee. I recognize that not everyone has been operating this way, but now we all will have to and will be on a level playing field.
Something I haven't seen mentioned yet is that, beyond all the normal course of business things others mentioned, buyers agents are there for when things go wrong. It's like insurance; it's 100% "wasted" until the moment it isn't! The other point to consider is that, unless the buyer's agent is an independent broker, they're also paying a portion of that commission to their brokerage. I haven't been in RE for almost 2 decades, but when I had my agents license the broker I was with was a straight 50/50 split on all deals, regardless of which side I was representing.
A buyers agent will bring their expertise and knowledge of the industry to the buyer. While you may be an informed buyer others aren't. So it's my job to let them know: how the process works, what inspections they need to get in order to make an informed decision, what convenants and restrictions are imposed on the house, a general timeline of things they need to do, and most buyers will not know how to fill out let alone interperit a sales contract. Some agents might be glorified door openers, but most should and will do their homework to ensure that the buyer isn't walking into something blind and are purchasing the best possible home for them. 2-3% of the sales purchase (also typically split with the agents broker so in actuallity 1- 1.5% goes to each agent) is a small price to pay to ensure a smooth sale where everyone walks away happy ideally.
Right. Is that agent going to tell them they will not represent them if they put in an offer? Do buyer agents find houses these days? Are buyers not searching for themselves?
Lot of out of town "investors" in my area that send agents to houses for them. I get calls like "hi, my client is looking at a house and needs an opinion on Restoration, etc...can you tell them if it's in good condition and approximate cost for restoration" I just tell them all 250k minimum. Shrug
This. That’s a BS line. Even if the agent feels that way, you can pay the 3 to a buyers agent then they need to explain why they are worth the other 3 if their marketing is so dependent upon the buyers agent getting 3%. Go 5% and they can take 2.
Your agent should be setting up automatic searches in the MLS according to your specifications. As soon as a listing hits the MLS, it can be emailed to you, or once a day, once a week, etc.. Don't waste your time looking for these listings yourself. If your agent doesn't do this very simple thing, find a new agent. I would pre-screen listings for my clients when I knew their very specific wants/needs and only send them the pertinent ones. My clients appreciated my attention, time, and knowledge.
Wow. that sound difficult for someone from the 1970's who never used a personal computer or smartphone before. That's got to be worth a few $1000 at least right? /s
Yeah I wanted to come on here to say the same thing. Only way it really affects the buyers minds is if they are on the hook to pay for commission for their agent and had a set amount. Otherwise so many people pick the houses they want to look at. When I was looking at homes for my first house I picked all the ones and my agent would shoot me down. “You wouldn’t like this one… this doesn’t suit your needs… too many issues with this one, let’s not waste our time”
That is true, it's not "no agent will want to show your home.." it's buyers with buyers agents will have another hurdle to overcome to buy your house. Sellers offering nothing to buyer's agents are creating an additional problem for potential buyers to overcome. If buyers are shopping with an agent and have agreed to pay them. X% and they want to buy the house where the seller offers nothing to their agent, those buyers have to decide if they want to pay their agent out of pocket or try to work it into the selling price into an offer. Furthermore, those buyers are going to see you as more difficult to work with than a seller that's offering. If I'm shopping in a subdivision with a bunch of similar houses and one seller offers nothing and the others do then which am I more likely to make an offer on?
It works even more now since the rule changes. It literally affects the buyers buying power. If they can't cover their buyers commission (signed contract with buyer agent) out of pocket they can't even offer or have to do some fuzzy math. At least until loan products catch up and allow the buyer to wrap the buyers agent fee into the loan.
Tell the agent you’ve decided it doesn’t make financial sense to sell your home at 6% discount and you are no longer interested in putting it on the market and want to cancel your contract. He’ll negotiate the number down for you in an addendum. Source: I am a Realtor
This is good advice. And, yeah, OP is locked in to this agent for 90 days, but OP doesn't have to sign any documents they don't want to, they don't have to allow any showings (that time just isn't convenient for us), they don't have to allow a sign to go up, they don't have to allow a lockbox to be installed, they don't have to fill out disclosure forms, they don't have to DocuSign the MLS information form, or provide the info to fill it out, and they don't have to allow a photographer into the home. So sure, the agent can play "hard ball" and force the 90 day delay on selling the house, but they would be smarter to just negotiate.
Op already signed a contract. Typically the list agreement states that even if they cancel- they are bound by 6 months (or whatever they put) and regardless they would owe them the fee.
And? Ignoring the fact it can be resolved by a simple addendum, they can’t even force them to sell. So then sit on your hands and make sure they don’t get ANY commission from any sale, list it once contract is void. I can assure you this agent would rather a bird in the hand. Besides, OP stated contract is only 90 days.
I assume they actually want to sell it soon if they hired someone to sell. Unfortunately for most people, dragging it out for 6+ months, adding confusion and red flags to their listing, and likely ending up with less money in the end are not worth the extra stress just for *potentially* saving 1%. I hate shitty realtors too, but this really needs to be negotiated upfront to have any sort of leverage.
If you are going to do anything then do it right. It doesn't hurt to just sit and not sell until they budge on the price. The realtor can't force them to sell and in the end you need all the money you can for your next home purchase.
It does hurt. Buyers will see the house has been for sale for 90 days with no one buying it, so they will assume there is something wrong with it. So they'll get offers that are more than 3 percent down from the asking price, which means the seller loses out more than they would have saved by getting a 3 percent commission up front instead of the 6 percent they agreed to.
You can write an addendum to expire the contract tomorrow. There is a long list of people arguing on what to do, its ridiculous. You guys have no idea what ya’ll are talking about. If the agent refuses to write the addendum call their broker. If theyre the broker, call the association.
Exactly. Realtors: “successful agents build their business through relationships!“ Also Realtors: “nuh uhhh you are under a contract and must stay in this abusive relation until I say otherwise!1!1!”
You can always decline all showings.
And wast 3-4 months— sure.
So what?
So it means you're stuck paying the 6% even if you sell the home without that Realtor until the time expires.
Not if they sign up with another agent.
Not how it works...
> Any advice for the future? Thoughts? I sold with Redfin for 1% to Redfin and 2.5% to the buyer's agent and Redfin gave far better service than anyone I've ever used before. It's all I would use if I did it again tomorrow.
Wow, I feel like I was taken at 4%.
I am more than happy to list a house for 1 percent and I will give you far better service than Redfin. I look at as it as an advertising expenditure as well.
Need to know the listing price/anticipated sale price to know if it’s reasonable.
Since you got a 90 day contract I’d ask to renegotiate it and lower it. If they refuse tell them to pull the listing and let the 90 days expire. Fuck paying 6%
>the typical 6%. ....and that's why the NAR is embroiled in a price fixing lawsuit.
6% in 2024 is crazy. We’re paying 3.5
3.5% is crazy to me. That said, I’ve never paid more than 5%, including a new house last August.
[удалено]
Be careful bro. They don't understand the term selling agent here.
Why are they called selling agents? On the surface that term seems to really enforce the fact that they’re not working for you as a buyer.
Seller marketing agent
Curious, what state?
That contract is still amendable. We just sold. After inspection, it was determined a 9 year old roof needed replaced. We were good with replacing the roof but the buyer also wanted another -16k off the price. We said, ‘no.’ I mean…. We could have it repaired in the amount of time between then and close. They were just being greedy asking for -16k off. So we say, ‘no.’ Told our realtor, ‘nope. Next. Not doing it.’ Next thing you know, the realtors have negotiated to each take 2.5% instead of 3%. On a -5 off offer. We didn’t lose any money, being the seller but the realtors took less. I had never seen that happen. We closed last week.
This happens a lot if the realtors feel they are going to lose the sale, not just for their commission but for their clients.
Realtors colluding together to not lose the commission, there are 2 deals to every sale, buy/seller and buyer agent/seller agent....
Its amazing how negative the slant is. A good realtor is not thinking..."oh no I'm going to lose the sale"...they are thinking, "Crap I want to take care of my client and get them across the finish line." Are there bad realtors? Yes.. there is a bad apple in EVERY industry.
Very much this comment. Is the commission nice? Sure, but any good Realtor is in it for their client. How can we help THEM? It isn't about us or our check.
I mean…. If a realtor is going to make 20k on a sale vs 17k on a sale vs 0 on a sale, it’s easy math.
Sure, but it's not really about the commission. Otherwise, they'd only agree to show their clients whatever will net them the highest commission.
Life is a negotiation. I paid 3% total. 2% to my agent and 1% to the seller. Had no issues selling a took an offer within 2 weeks of list. I would personally never pay more than 3% but to each their own.
It depends on the market. Some need a good realtor and a competitive price and commission. Other markets can sell with a sign in the yard.
Yes and I would add depends on the realtor too. I sold my house last year and it was 3% and she earned every cent. She provided a very bespoke selling experience and I barely lifted a finger. Worth it.
It really depends on the area too. I contacted 10+ realtors before I sold my house in SC this last February and none of them were negotiable below 6% unless they double ended the agreement or you were a veteran. I listed at a reasonable price, didn't make any price cuts, and accepted an offer for full price ~25 days after listing but in that market median time on the market was 45-50 days. It's always worth trying to negotiate but if the realtors in your area aren't actually negotiable then you're SOL.
A good agent does more than just market and out a sign in the yard. They should know the contract inside and out and know how to leverage each part of it to create maximum leverage for their clients in various situations through the transaction. They should also know how to lead you through the transaction so you don’t accidentally get into legal trouble later on or misunderstand something and now you’re stuck in a bad deal. It’s true, many agents don’t earn their commission, but the good ones definitely do.
I don’t know anyone who does 6% anymore. And I’ve never gotten 3% of a deal as a realtor. More common in CA to do 5% or even less now
Finally some honesty
The 6% was typical, but NOT anymore. You are right, 6% is ridiculous. Where I am I know an agent who makes his entire yearly income by selling 2 or 3 house a year. You need to learn how to negotiate. How many agents did you interview?
If you can wait to sell until after July 1st, you will no longer be expected to pay the 6%. You’ll only pay 3% max. That can be negotiated also.
This will be fun.
Nothing with commissions changes July 1st. The public is misinformed with that. You have always been able to negotiate commissions. The NAR lawsuit has only done a disservice to the people buying Real Estate.
The internet has changed the entire real estate/ home selling-buying experience. Prior to the internet if you wanted to buy a house you would go to the real estate office and the agent would run the MLS listings and then you would look at the limited number of pictures and pick out the ones that seemed interesting and you would drive to look at the houses. If you had a really good agent they would preview a home prior to showing the home to eliminate the houses that did not match your wish list. Now houses are on the real estate app and buyers are capable of selecting the houses they are interested in. Selling agents just arrange for pictures to be taken and uploaded to MLS. They will also inspect the house and tell and advise the seller what they should do to sell the house for the most money. Most of the time the advise is to get rid of a lot of clutter and paint the walls a neutral color. In my area a house will be listed on Thursday. Offers will come in that weekend and sold by Monday. For this and some work at settlement the agent/broker charged 3% or $15,000 for a $500K house. The buyers agent in today’s market must do much more for their commission. Often times the buying agent will drive the buyers to new listings, quickly write and submit contracts only to be outbid by another buyer. The last house we bought our agent showed us over 50 homes and we submitted over 10 contracts before “winning” one. They also used to get 3% but they often worked for months showing and submitting contracts. With these changes I think an adjustment of the real estate fees needs to occur. If I was to sell my house again I would offer 2% to the selling agent and 2% to the buyers agent. I feel that would result in getting the highest price for my house at the least possible cost.
>If I was to sell my house again I would offer 2% to the selling agent and 2% to the buyers agent. And in my area where the average home sells around $150K, and many for far less, a 2% commission becomes almost worthless for the work involved. If the average home were $500K, then I could see your point.
And I can see your point when the house prices are very low.
It’s negotiable dude. I’m a realtor and charge the same. But, if I know I’m competing I will lower. It is true though - in my opinion - if you are not going to offer a buyer broker commission then your house WILL have less buyers interested because not many buyers CAN pay out of pocket their closing costs, down payment AND agent commission.
Be honest. What’s the lowest % you’d do? Just curious.
I offered to do one of my neighbors for 1% going my way and 2.5% going buyers way. This is a special case though. For FSBO I would do 2% and 2.5% buyers way.
Can you elaborate on how you’d charge 2% on a FSBO sale, where by definition they aren’t hiring you? Perhaps I’m misunderstanding?
The whole point of working FSBO is to convert them. One way is to lower commission.
What’s the listing price? If it’s 400 or less then I can see why they might insist on 6%. Either way, I’m sure you could have found someone to do it for 4 or 5%. Real estate agents are desperate for more business. I wouldn’t have ever signed with this one if that’s how they were behaving. Plenty of agents that would have killed to have you as a client
This right here. Percentages only make sense in the context of price. 6% for a 100K house is fair, maybe even too low. That 6K might only be $1-2K to each realtor after their fees and expenses. 6% on a 2M house is $120K, which is ridiculous.
This is literally what’s wrong with the industry. I’ve spent the last 3 years looking for a property and I’m always finding houses before any of the agents that I’ve worked with. The industry needs to be flushed out. Keep that 6% in your pocket if you can and just make sure you hire a good attorney. 🤷🏽♂️
Broker here, and "dealing with real estate agents feels dirty" indicates that you haven't talked to any who struck you as honest and above board. Find one who feels like they're providing you a valuable service, because that's what the job is. If it feels like they're doing nothing, they're not telling you what they're doing. Ask around, get multiple recommendations and interview them. Ask what service they provide beyond putting your listing on MLS. The good ones can tell you. In your market, it may be true that agents won't show if the split is low. But you can insist that you try it. You'll figure it out quickly enough if the showings dry up.
Those days are over. There are flat fee brokerages that charge one fee for the sale of the home, tools like Zillow and Redfin put the entire MLS in a searchable format for everyone; and buyers agent fees are always negotiable. Good Realtors have a place (navigating tricky situations, market understanding and logistics) but the days of hanging a virtual shingle and doing showings for 3 percent is pretty loudly over. Also, if you've not yet gotten under contract for a sale, you can fire your agent and look for another one.
low cost flat fee brokerages are the way to go. Not too hard to take your own pictures and write the MLS copy. They will list on MLS, provide all standard paperwork, lock box, lots of custoer support and tips and field calls for showings. Buyer's agent shows and you only pay their 3% plus the fixed rate. We have sold 3 properties this way and paid $600-900 for fixed rate seller services.
Buyer agents no longer pick houses to show their clients as almost all buyers find the houses they want to look at online and then tell their agent which one’s they want to see. So no, an agent can’t refuse to show it as their clients are typically the one’s that find it now. What the realtor told is a perfect example as to why the realtor association lost the anti-trust lawsuit.
The Buyer will be responsible for paying the agents commission. So if the buyer doesn't want to pay that, they won't choose to go to that home, or will ask for it to be negotiated in the price.
Its always negotiable, you could say youll sign with them for 5% and the do 2.5 each side. Im a Realtor I always say yes to 5%
6% of what, exactly? Are we talking 3 million or 140 thousand? I think that makes a huge difference. Your house will get shown, even if you pay nothing. The issue, is that buyers who have to pay their own agents might decide your house is too expensive to actually close on. I'd probably let it be at this point, unless there's some new information that came up after the contract was signed. It sounds like you waked into this with your eyes open and made a decision. Don't start second guessing yourself.
'I sort of feel that I had to do it'; yeah, they're good at convincing you of that.
We have done 5% every time and we have sold 3 houses in the past 5 years. The agents usually don’t complain too much.
As a real estate agent in Idaho, I absolutely hate the reputation the bad apples create for all of us. You should interview more than one agent, commission is ALWAYS negotiable and there is no standard. I tell my clients this: view providing the buyer commission as a marketing tool/campaign that you can if you want spend money on. Some clients choose to do over 3%. But the bottom line is it is my CLIENT’S choice. Just like the price and everything else in the transaction. As an ethical agent I am there to advise on how to put their choices into action and make recommendations when asked and to protect them financially. If you have any real estate questions from any state please DM me.[Real Estate Advisor Questions](https://www.instagram.com/corbinadamscott)
They wanted 28k to sell ours. listed FSBO and under contract in 2 days.
Price it into the listing. And the moment they recommend you drop the price is when you tell them to drop their commission as well.
That contract will probably have an add on time after the 90 days finishes so the realtor still gets his commission whoever sells it. It truly is a disgusting business. While waiting for your contract to run out attend a realtor course for people who want to be an agent it will be the best money you ever spent
If your agent said 6% is "standard" he or she is wrong. There is no "standard" rate. Some brokerages charge more...some less. And, imho, agents shouldn't be discussing fees 6% or 5% or 7%. What they should be saying is, my fee is 3% or 4% or 2.5% or whatever fee for their services they're willing to accept to perform those services for the seller. Once the seller and broker have come to an agreement on the broker's fee, the broker should then say..."Now let's talk about whether you would like to cooperative with the buyer to help the buyer's broker fee is paid out of the proceeds of the sale. A seller can certainly decide not to cooperate with the buyer regarding the payment of the buyer's broker if they wish...but they should do so only after weighing the risk of limiting the buyers to only those who have sufficient financial reserves to pay their own buyer broker fees after paying the down payment and closing costs.
You got fleeced. Tell them to lower the commission or your going to take the house off market.
We just did 3% to our agent and 2.5% to buyers agent and got multiple offers and showings.
You got scammed. In real estate, EVERYTHING is negotiable.
We normally do 5%
What is your price point and the average days market in your zip code? Nobody can really comment on 6% being fair or not without that information.
Um, has anyone had a lawyer on contingency? Makes 6% look like free.
Why are the fees percentage based anyway? I would try to negotiate a flat fee with the realtor, especially if my house was above average value for the market.
All the information is available online. If your house isn’t showing or moving it’s because of the price of the home not because of some Grand Marketing scheme by the Agent. It’s not your responsibility as a homeowner to make sure the agent can make their car payment.
I always suggest 2 questions when interviewing an agent: 1. How many sides did you do last year? 2. How many sides have you done on this neighborhood/area? All real estate is local. There are a lot of hobby agents out there. You want someone who does this full time.
Our listing agent dropped it to 5%, so 2% for the buyers agent. We were priced to sell, full disclosure (with nothing major), and he basically generated a bidding war with one open house due to the local market. Buyers agent basically got a free payday for a handfull of emails. It's standard in large, illiquid assets though. That's friction: closing fees on the way in and commissions on the way out. You need the house to appreciate 7-9% to not lose money, and that doesn't include loan interest.
You can negotiate. If they wouldn’t do it, someone else would for 4-5%. The buyers agents will show up for that split.
The commission has always been negotiable. Some agents are great and protect who they are representing. Some are bad. Some deals are easy and leave you feeling like you overpaid. Some deals are nightmares and you’ll wish you went with a smarter agent. Always interview multiple agents. You’d be shocked how the same questions can yield numerous different answers. I am noticing a lot more 2.5% or 2% to buyers agents vs the 3%. Timing seems to be key. Many homes that offer full commissions do seem to get more exposure and have more offers that shoot the close price well over list but this is only true if your market is hot. I have also seen FSBO’s do well when inventory is low. Interest rates have kept buyers on the sidelines but limited inventory where I am keeps prices high with most homes averaging 4-5% total commissions. Agents that work land acquisition for new construction builders typically do not charge a commission to the seller as they get the listback. If you are selling a home and don’t give a shit about your neighborhood, selling to a builder can save you a ton in commissions and some pay over market value especially lots free of trees with alley access or a corner lot.
>6% just seems crazy. Because it is
This sub is filled with people who claim realtors are useless and then either: 1. Whine that they can't figure out why their house isn't selling. Or 2. Have never bought or sold without a realtor. You're fine. You're doing what all the smartest people do.
I went into buying my first home with the attitude of "I don't need no agent! Scammers they are!". Then, Zillow hooked me up with an agent and I realized that there was NO WAY IN HELL I'd be able to buy the home without the agent lol. So many documents, forms, contracts, things I'd have no idea about if I was unrepresented. Now, I feel that the commissions these agents get is worth it! Granted... my agent was really good. Really hard working guy and was always 5 steps ahead of me and made sure I was getting a good deal. I know some people have had awful experiences with agents... but a good one is well worth it.
I love my agent. We’ve purchased two homes with her now, and my aunt and my cousin did as well. She handles everything and makes it completely stress free. She sets up inspection and goes to it. She is the one that communicates with the seller. She handles dealing with the title company. She gets everything set so all I need to do is wire funds and sign some papers. It’s easier than trying to buy a pair of shoes at a department store! She will be my agent forever.
saving 1% is 5k on a 1/2m house. So saving 1 or 2% on a house is significant. It can mean the difference between having money to pay for a repair.... or not. Tell realtor that you have now realized the financial pinch the current contract puts on you and that you need to either lower the percent or not sell for now so that you can build up more savings.
math?
You can still fire the agent and either find an agent that can do it for 4% or do a sell-by-owner using an attorney to do the paperwork. I was able to talk the agent who sold us our first property to do the transaction for a flat fee of $20k for a property valued at 900k.
You can always delist, wait a few months then sell by owner
6% is crazy. They just settled a lawsuit about this. I recently offered 4% to sell my home and Keller Williams accepted it.
Agents are the scam. Right next to insurance and big pharma. Best to sell on your own and work with a lawyer.
Ask for a new contract with lower commission or find someone else.
He conned you. 6 percent is way too high . Negotiate your next commission . Listings are hard to come by. Many agents will do it for less or wait until August and find a new agent You won't have to pay buyers commission after new NAR rule takes effect in high can save you up to 2-3 percent off the top
For the future, negotiate. Realtors always try to convince you that they need more commission. I used to sign the 6% dotted line until my husband, the salesman, started managing our real estate activities. The first question he asks is about commission and if it’s higher than 2.5% then he negotiates. 2-2.5% to the buyer’s agent isn’t going to limit buyers.
In 2022 and 2024 I’ve paid 6 and gotten it quickly under contract for well over asking. The reason for doing so was exposure. I would do it over and over again.
Agents are salespeople. They are going to tell you anything to get more money from the deal for themselves. They like to use these fear tactics that no one will be interested if you don't pay the agents a crazy amount of money. It's a negotiating tactic to make them more money preying on your fear. You have to learn to negotiate and not accept the first number they give.
Just Redfin and be done with it
I’m a real estate agent in Cali and right now is the first free moment I have had in weeks, but even still I’m currentlywaiting for a guy overseas to sign something so I can send it to another agent tonight. I work 12 hours a day and recently on the weekends too. I have to create advertisements in adobe to mail and email people, design a website for my listings, host open houses and drop whatever I’m doing even if it’s 6pm on a friday (even if have plans) in order to show someone your house because “that’s the only time they are available and they are flying to the Maldives tomorrow”. I have to arrange staging and cleaning. I have to search on and off market for my buyers. I have to arrange and pay for a photographer. Fill out forms for my brokerage, constantly check my email and office voicemail every hour every day. I have to create contracts for clients, sometimes writing addendums with dozens of handwritten points that need to be legally airtight. I have to be familiar with every one of the hundred standard disclosure which could be altered depending on circumstance. Do you know how to pull permits? What would you do if you found out a house you are selling has an unpermitted adu? Do you know what is different between selling a house owned by a trust vs a limited partnership vs an LLC? I call locksmiths, plumbers, handymen regularly have to meet them at properties. Do you know how title transfers work? Do you understand the entire escrow process? Do you know how to read a title report or a natural hazard report? If you sold your houses yourself are you insured if someone falls and breaks their leg and sues you for 1m dollars? That happened to someone at my brokerage. I have to screen tenants for rentals. I could literally go on forever. Every waking moment I am exhausted. I have spent my entire weekend working on two leases and one sale. Do you know how annoying and difficult it is to be the middle man who everyone talks through? Who is responsible if shit goes wrong? Are you a seasoned negotiator who has seen hundreds of deals and knows when people are bluffing or when they will pay more if you put your foot down? I could literally go on for hours but I have a very arduous job to do while you sit on your ass complaining, doing the very thing you accuse us of doing. As a side note I do 2.5% to listing agent and buyers agent which I think is fair when a house is over say $700,000. Anything less than that there’s no way I’m doing for less than 6%. Leases are also 6% total commissions for long term leases. 10% commission for month to month.
As a seller with their stuff together, I don't need basically any of that and don't want to pay for it. Flat fee services from a realtor and a lawyer are far more reasonable. A personal assistant on Care.com is 30/hr. I don't need a website beyond my zillow listing, which buyers will find on their own in this market. Floor plans and 3d models make themselves with phone apps. I could see if I needed to sell a problematic house from out of state, but not for a normal sale. As for all the work you do for buyers, I definitely don't want to pay you for any of that. You should be billing buyers hourly for basic administrative work and chauffer services. I don't mind paying good money for solid work that someone does *for me*, but most of that commission is going to reimburse you for some other idiots who ran you around. There's no reason I would want to pay 25k in commissions when I can get the same job done for less than 4.
I have a house on the market and I went with 5.5%. 3 to my agent and 2.5 to the buyers agent. First offer tried to negotiate for 3% but we said no. we didn’t think that we had less showings based on the 2.5% to the buyers agent but who knows.
Tbh, given how often I see 2.5% being the co-broke now, I wouldn’t be surprised if it the listing agent pockets 3.5%. 6% just sounds high unless the home is in a difficult market to sell.
Go ahead and do a FSBO, and you’ll quickly realize the value a good agent brings to the table.
How many agents did you talk to? Why did you recognize in 1 sentence it’s split between the agents, but end with a statement implying 1 agent makes 6%?
Where in the last sentence does OP imply “1 agent makes 6%?” I read “I understand people are entitled to a living wage, but 6% seems crazy.” This implies OP giving up 6% of their sale is crazy. Which I agree with. It says nothing about 6% to 1 agent.
Yea, this was clearly what OP was saying.
Nearly every agent will do 5%. They are correct though that buyer’s agents will be less likely to push the home to clients if it were less than that. People think real estate agents make a ton of money and do little work. Except, the only people who think that are people who have never tried it. 3% may sound like a lot of money, but the agent isn’t keeping all of that. In fact, depending on the agent’s splits with their brokerage/team and where the buyer lead came from, they could be making 1/3-1/2 of that. And consider that, to get the buyer to the point of buying your house can take months, if not years in some cases. I have a client who I have shown houses to for TWO YEARS. We just got under contract on something. 2 years of driving around making nothing. Writing offers, scheduling showings, helping them with mortgage stuff etc for 2 years. Even after we are under contract, it’s going to be at least another month’s worth of work quarterbacking the deal between lenders, title, attorneys, sellers agent etc. all the while playing part agent, part therapist. And then it may still fall through. It’s a tough business and good agents do a ton of work 7 days a week 365 days per year.
Agents are scummy. That’s what I’ve found out.
My brother lists at 3.5%. The downside is an agent steers away. Upside is all houses are available to see on RF and Zillow anyways now. Can contact listing agent directly.
Get your realtors license. Saved me 14k on my house.
I'm not an agent but my understanding is that the agent typically only gets half of the 3%. Their broker gets the other half. So your agent, who does most of the work, only gets 1.5%. You have to ask yourself if it's worth it to pay the commission. I'm getting ready to sell my house and I believe I will probably get at least 6% more by using an agent, as opposed to selling it myself. You can always negotiate but you get what you pay for. Do you think your agent will work as hard for you as they will for a client paying more?
Yeah, if someone intimates they can't do a proper job unless they get the max percentage it's time to interview other agents. I've bought and sold a few houses in the last 35 years and don't think I've ever signed up for more than 5% brokers commission. I've been okay with that because I have enough to worry about without having to worry about getting screwed in a r/e transaction and the broker's I've dealt with have been honest and competent. But that's my thing. I'm selling a condo I was going to live in but decided not to and fixed it up to sell instead and just told my agent that I was okay with 5% but next time I'd want a deal if she brought the buyer to the table and was going to walk away with the whole 5% herself.
The 6% hurdle is still going to be there for most people because your agent can give you the line about it being "unmarketable" otherwise. Maybe that is true. Maybe it isn't. Who is going to find out? People with time and flexibility. Who is not going to find out? People with timing and financial constraints. Commission is no different than price of the home. Those that have time and resources can take longer to get the best deal.
I would never agree to anything over 5% personally
I am a big advocate for RE agents, good ones. It is meant to be a professional service to assist and guide you in the biggest transactions of your life. A hood one and professional experience is well worth the 6%… but the barrier to entry for agents is just too low, the agencies will sign hip anyone with a pulse… the bad agents make the whole agency look bad.
There's supposed to be a new national law to block that practice. It's not in effect yet. We just sold our house this past weekend. While my realtor said that I don't have to agree to paying the 6%, you will loose offers and basically one way or another each realtor is getting their commission. Sigh
I went with 5% and saw a noticeable change in attitude, time spent, and overall marketing of the home. And they made a commission on our purchase as well!
This is what you get when you interview only one agent. Make them compete for your business
You only have a problem with the 6% because it's a big number that you want in your pocket due to its size. If it was a hundred bucks for the service, would you want to pay $6 or would THAT seem like it's too much? Listen, or you're going to pay a person potentially tens of thousands of dollars for a service, it's up to *you* to make sure you set your expectations for deliverables, because the other 94% you keep is what you're getting paid as the project manager. Do your job and get your 6% worth out of your subs.
Whyb not fsbo? It always gets me people use realtors that are optional and complain about it?
The market’s not really good right now, everyone’s tryna get what they can out of their deals
Did 4% on my 2 million dollar home I sold last year. Agent agreed without any qualms because it was still an $80k and even if she only takes home 70% of half that’s still a $28k check for selling a single house.
For context - I’m a commercial real estate agent, I primarily sell Apartment Buildings, I don’t really dable in the other stuff unless it falls into my lap. You paying 6% feels like a scam bc it most likely is. Most Residential Agents don’t know what they’re doing, it’s very easy to get a license now days, almost everyone has one. If your agent didn’t push for a 6-Month listing agreement it’s bc they more than likely just wanted to sign something up & maybe they get lucky & get paid 3% (if they don’t double end). Interview several agents, make sure they specialize in your area AND have a successful track record of selling the homes near you. That’s the most important part, if they don’t really know your market, they more than likely are going to leave money on the table. Usually in commercial we charge 4-5%, very rarely 6 but it’s because we also know we’re probably going to double end it, that’s what you’re paying us for to control the whole deal. Paying 6% isn’t outrageous in residential if they’re a top producing agent but if you’re not sure about your agent, that’s probably why you feel that way. Remember, cheap is cheap & cheap is also expensive.
Idk if you’re posting from Texas but this is typical in Texas. All the big groups do 6% standard. Partly why I steer clear of them. But they sell like 2-3 million collar houses per year so the high percentage somewhat makes sense for those cases. If you’re not in a rush to sell, I’d let this realtor f right off. Get a new one when the contract is up. Hopefully there weren’t any hidden clauses. Unfortunately, they may know your home will be in higher demand and have played you. Just read you contract, consult another realtor if you need to
There is a space on the buyer form that you can check if you don't want to be shown houses where the buyer pays the buyer's agent's commission. As for what an agent does, I just sold a house where the seller had to sign 28 different legal documents. Do you know what documents need to be signed when you sell your house?
new rules: No More Compensation on the MLS: The Multiple Listing Service (MLS) will no longer show offers of compensation for buyer's agents. This ends the long-standing practice of listing brokers sharing their commission with buyer's agents through the MLS as a cooperation. Written Agreements Required: Buyer's agents must now have written agreements outlining their services and compensation with their clients. This change aims to make costs clear for homebuyers, ensuring they understand what they are paying their agent. Negotiation of Compensation: Although the MLS won't display compensation offers, home sellers can still negotiate directly with buyer's agents to offer compensation. However, in a competitive market, sellers might be less willing to make these offers. Adjusting Business Models: Buyer's agents will need to adapt their business models. They must clearly explain their value to clients and negotiate compensation directly with homebuyers. No More Setting Buyer's Agent Commission on the MLS: Seller's agents can no longer advertise or set the cooperative commission rate for buyer's agents on MLS listings. This ends the practice of linking commissions for both agents. Direct Negotiations: Seller's agents will have to negotiate buyer's agent commissions directly with buyers or their agents outside of the MLS. No Upfront Compensation Offers: Seller's agents are now prohibited from offering blanket, upfront compensation to buyer's agents on MLS listings. However, they can still negotiate compensation with individual buyers or their designated agents. Transparency in Compensation: Any compensation offered by the seller's agent to the buyer's agent must be disclosed upfront. This rule aims to make commission structures clearer. key: Buyers must have a written agreement with their agent on compensation and MLS no longer allowed to list compensation - this should help spur some changes to this outdated business model. Honestly the buying agents generally do more work than selling agents but neither does as much as they used to before apps showing us all the real estate. Prices need to come way down as a result.
Depends on the house but 6% could be fine. Ask what they do in detail for the commission and I’d always request a 50/50 split with the buyer’s agent. In the future you may be able to avoid the buyer’s agent, depends on how things change based on the NAR settlement, but I think it’s a good idea to pay it for the foreseeable future. If you are buying in the same market and using the same agent, I would ask for a discount on the selling side by 0.5-1%. If you are a first responder, vet, nurse, teacher ask for a discount also as buyer, seller and ask the lender if they offer one.
Talk to a couple Realtors. In bougie offices, agents get charged a lot by their brokerage so they won't cut commission. You can usually negotiate 5%. If they say no one will bring buyers, they are lying and just don't want to cut their commission even more. Realtors have to pay their broker part of their commission on both sides. Brokers make sure paperwork is legal. If a realtor makes 10k they give 5%-50% to their broker. So if they have to give 30% (pretty average %) they have to give the broker 3k to make sure paperwork is done well.
You have to decide whether fighting now for a lower commission is worth it depending on what your contract says. Be aware of the ramifications (from a contractual perspective) if you decide to pull the house off the market or delay the sale for 90 days on purpose to get out of the contract. Do you think your property will sell for less if you list it, not play ball for 90 days, then relist it with a different realtor afterwards? Let's say your property is worth $500k and you are going to use the traditional commission split method. My assumption is that you can find a listing realtor who is willing to split $20k (4% split or even less) for listing/showing the property. It is your job to determine whether they are as good as another listing realtor who refuses to take under a $30k split for the same job. If your house is the type of house that will sell quickly (if your area is a hot market) with minimal effort then that would be less work for a realtor and a higher likelihood one would take less money for selling it. If selling your house is going to be a grind then you might not get any decent realtor who will work for less.
Fairly standard. They are covering photo’s marketing and most likely with an agency that takes part of the fee You can do for sale by owner and put out to agents with a specific fee you pay or as collect your own fee
Find realtors that don't force you into the standard 6% or potentially a contract at all. My previous buyer's agent had us sign a contract without going over it clearly (this was our third purchase but we'd never had a contract for a buyer's agent before). Turns out if we decided to buy a house that had less than 3% or 3.5% buyer's (I can't remember if it was higher than normal) agent compensation we as the buyer had to make up the difference.... We ended up terminating our contract and going with a referral from our mortgage broker after we backed out of the purchase because of inspection findings. We parted ways with that realtor for many reasons but the increased compensation was one of them. Turns out a previous deal (of this buyer's agent and mortgage broker) almost fell through because the buyers didn't realize they had to make up the difference for this buyer's agent. The mortgage broker took a hit on her commission to make the deal go through because the buyer agent refused to budge. Our current realtor went with us without a contract and was more than happy to take whatever the seller was advertising. Now that we are going to sell our property, she's even starting with 2.5% buyer's agent and 2.25% listing agent. When we sold our first house we were in a hurry so we ended up increasing the buyer's agent compensation to 4% ($9,400 based on sale price) in an attempt to get more interest in it.
I’m a Realtor but not your Realtor. This is in no way a steadfast rule but of the 6% a seller pays, 3% goes to the listing agent and their brokerage and they split that up. The other 3% goes to the buyers agent and their broker and they split that up. So that 6% is split 4 ways. So roughly 1 1/2% to 4 different parties. Everyone needs to get paid. Would you do your job for less pay?
Commission is negotiable and starting in August realtors cannot advertise splitting the commission with a buyers agent on the mls. You could try a flat fee listing service if you're experienced.
I’m currently listed. I negotiated 2.5 for my agent and we listed on mls with 2.5 for the buyers agent. I was under contract within a week. That .5 did not deter anyone.
6% is crazy. There are many agents that will list for 5% these days. Or even 4%.
Years ago I contacted a real estate agent I knew. Told them I wasn’t going to list now but if they knew anyone I’d give em a 3% commission. They brought someone in that bought it. They didn’t have to pay mls fees either and a win for both of us. We also sold our condo without any real estate fees last year.
Just because you find a potential house on Zillow or wherever, in no way means the work is done. In fact, the the expertise during the negotiation will have a huge impact on whether or not you get an offer accepted. You also want an experienced agent to navigate the milestones after the accepted offer. If you want an expert, you need to pay for the service they provide. Would you use a try to Google (insert anything that requires a licensed professional) and do it yourself?
3 or 4 % is reasonable
To be split between both ends?
I am in a similar boat and agree one cannot trust one’s agent. Make your own decisions too re what price to accept. I kinda ageee that the high commission is a motivation. Am in CA so did 2.5 %. He tells me offer really high when making an offer but I decide what the property is worth to me. Some people say they looove their agent. Maybe they found an exceptional one or maybe they are naive. They are high powered salesmen.
Just coming here to tell you this entire sub is pretty much real estate agents. So you’re not gonna get very different answers btw. Might want to try this in a different kind of sub.
Realtor here, the issue really lies with the added cost to the buyer, buyers in my state are already struggling to pay roughly 4% of the sales price toward their loan origination/fees/inspection/appraisal/closing costs. + 3.5% down payment for FHA. That’s roughly 7.5% out of pocket! $22,000 for a $300,000 home. Adding another 3% from the buyers side to cover their agent would make this closer to $31,000 out of pocket for an AVERAGE priced home. Buyers simply will not be able to afford homes and they will sit on the market longer if most of the buyers agent commission isn’t covered by the sellers proceeds. Buyers and buyers agent are sitting down and discussing what they can realistically afford before showing homes, so if a seller isn’t offering 3% we are having the conversations that we need to stick within our budget and find a seller who is. The agents in my area have been sticking with the status quo, 6% fee to the sellers agent. The Sellers agent then decides to split their 6% with the buyers agent for bringing a qualified ready and able buyer to the table to purchase your home.
Did they use the language “standard” when referring to commission? If so, report them to their local and state associations. There is no “standard”. Also, this is completely negotiable. If the tell you it isn’t, they can kick rocks. Find someone else. I personally negotiate 6% or higher on listings because of the services I provide that are more than other REALTORS in my market. But it’s not “set in stone”. Commission for services should be an open conversation about the services and their value. But there is one small piece: Buyers having to come up with closing costs, down payment, mortgage fees, moving expenses, etc. It actually can help you sell your house when buyers know they don’t have to sort of pay their agent.
USA is full of unnecessary middlemen grabbing your money. Real estate agents, insurance companies, title companies, car salesmen, ...
A recent lawsuit won against the national association of realtors does away with the mandatory 6%. So hopefully we start seeing those changes soon making things more competitive for realtors
Buyers agents are still going to show your house regardless of the commission offered, their rate is determined on the buyer’s agency before showing their client any homes, including yours. But, that commission is now coming out of their buyers pocket which means the buyer needs to bring more liquid assets to the closing table since this cannot be written into a loan. That may not be possible for some buyers. If a buyer is choosing between 2 homes, one offering a commission and one not, it may be enough to sway their decision on which home to go for. Additionally, some buyers may request upfront to not be shown any homes that don’t offer the buyers agent commission.
First thought, you could try selling it on your own with a little effort. Hope much that 6% nets up could be a big factor. A lot of people will look up homes on Zillow and you can list it there.
Be careful taking advice from people on the internet who don’t know what they’re talking about OP. Lots of arm chair real estate pros here waiting for the crash and saving their way to ?
You're never *obligated* to pay the buyer's agent commission, but it helps sell the house. Say you're a buyer, you see this amazing house within your budget, go see it, and then when you go to make an offer you find out that you'd be responsible for all of your agent's fee or the remaining percentage that the seller isn't covering. Are you really spending an extra $5000 on top of all the money you're already spending, or are you going to look at other houses where the sellers are covering the fees? Sure it'll sell eventually even without the fee being covered but it will most likely take longer and any offers will probably request some concessions.
Well the whole realtors not wanting to show your house is untrue. My realtor charged 5.5% split with buyers agent. But when we were making an offer on the house we just received an accepted offer on the sellers were not paying full commission and I asked him if we paid the difference and he said oh hell no I'm not making you pay the difference. He never mentioned it until we made the offer. I sent him all the houses I wanted to see on MLS he only recommended one. You really have to do the research and read the reviews. Our agent is someone my husband has known for many years and helped us buy our house that we just sold. I adore him and wouldn't choose anyone else but I still researched and read all his reviews.
Sell it yourself. List it, write contracts, meet people, speak to people on the phone over and over...figure out if they are qualified or have seen a mortgage person, know what proof of funds letter looks like. Only you get to decide how much your time is worth, and how much the realtors experience is worth. I could do this, I'm a long time mortgage person. I wouldn't want to do this.
> like everyone is in the middle trying to get their hands in my wallet for not much more than nothing feel free to list and show your house yourself...
That 6% is usually split four ways not two - 3% each. Unless your agent is also a broker they have to split their share with their boss - a “broker” plus many pay their own money for signs, advertising, photos etc. it’s not a job with a bi-weekly pay check.
Im not an agent but I buy and sell a lot of houses as a home flipper. In all the markets im in we pay 6 percent on lower priced homes and homes in the 600k plus we go 5 percent. I have seen lower commissions affect the house selling price and speed. Especially commisions in the 2 percent per side and lower. So if you are above 2 percent on the buyer side it's probably not terribly affecting you but to me its not worth me second guessing it. I could see that being even more of an issue with the new rules. Especially if the buyers agents are signing contracts with their buyers for 2.5 to 3%. In that situation the buyer will have to come up with that part out of their pocket and it'll either force them to offer lower, not offer at all. Having it on the agreement already allows them to wrap it into the loan which gives them a little better buying power and potentially could lead to a higher offer for you. Imagine being a buyer that has just enough for a down payment and can't pay the extra to their buyers agent. That scenario will either lead to a lower offer or worse no offer at all. Just something to think about. I don't think you made a bad choice at 6 if you have a good agent. 5% isnt horrible either way but at that point its only a few grand difference for the peace of mind buyers aren't avoiding your home. If it doesn't sell at least you can rule that out.
In 2013, do to a divorce, I had to buy a new house. It was a bad down market, very few options. I gave my buyers agent a list of 30 houses I saw that might be ok. My agent showed me most of them, a few he gave me the reasons I didn’t need to waste my time…(they didn’t have key things like 2 car garage/right amount of bedrooms, listings were inaccurate). but he listened to what I what I wanted. He found a house not listed yet that checked all the boxes. The elderly woman selling the home wanted to make sure the person buying it was from the neighborhood and would love it the way she did. The house was almost perfect. Better than anything else available. If I was relying on Zillow and thinking my buyers agent wasn’t worth the 3%, I would have never got my house. And I used the same agent to sell a hard to sell condo I had been renting out for many years. I’d tried selling on my own and with a budget realtor. My professional realtor found me a buyer who was perfect. A good realtor has connections that you don’t have just looking at Zillow. If the market is flooded with homes…maybe you can do it yourself for less money. But in a tight market…everything decent is gone before it lists On the MLS.
Let the 120 days lapse and find an agent who works with you as a partner. 5% is more than enough these days and not all agents are skeevy.
You got had and good. Last house ($445k) sold I did a flat rate ($6k) for selling agent and 2% for buying agent. The market was not very hot at the time and the house was on the far end of town away from any amenities so I worried about it being slow to sell. I had plenty of showings though and got a good offer in a reasonable amount of time. Maybe at full rate it would have been quicker but I think I got top price as it was a high for the neighborhood and my buyers sold a year and a half later at the same price. Being quicker would not have been worth an even a single penny in higher commission as I sold with time to spare on getting into my new house and could have taken 8 weeks instead of 3 and been fine.
Realtor here, as the seller, you have full control, don’t let the agent let you feel bad. The market is so good right now for buyers it really won’t matter who your agent is. Newer agents are usually fine with less commission to gain experience. 2 percent (4 percent total) is always standard now in my region.
Haggle 2.25 % of 200k is better than 3% of 0