Author Topic: Fair Realtor Commission  (Read 2114 times)

rjack

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Fair Realtor Commission
« on: September 15, 2015, 09:19:26 AM »
I'm getting ready to sell my house and I'm interviewing Realtors. My house is worth approximately $350,000 and "normal" real estate commission are 6% but negotiable.

Is asking for 5% reasonable? Lower? Higher?

Are there certain conditions in which I can ask for lower? For instance, if the buyer is represented by a different agent in the same office, is it reasonable to ask for 4% for that situation?

Thanks!

forummm

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Re: Fair Realtor Commission
« Reply #1 on: September 15, 2015, 09:51:32 AM »
Good luck! The whole thing is a cartel so you might not have much success. I think if you really want to save money you can DIY (FSBO) and just pay to have it listed on the MLS.

iamlindoro

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Re: Fair Realtor Commission
« Reply #2 on: September 15, 2015, 10:01:19 AM »
The commission is definitely negotiable-- how hard you will have to push for the reduction will probably depend on how hot the market is, but I've been successful in the past in getting it down to 5%, and it's not unheard of for it to go even lower.  As with so many things real estate, it's likely very local.  It can't hurt to try!

Random Hangers

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Re: Fair Realtor Commission
« Reply #3 on: September 15, 2015, 10:03:57 AM »
I believe the 6% includes the buying and listing agent, both at 3%. You can ask your listing agent to reduce their fees to 2.5% or 2% and see if they're willing to negotiate, but I've read that if you drop the buyer's agent fee, sometimes they'll just opt to skip over your house to another with a higher fee (more money in their pocket!). In this day and age, with the Interwebs and all that, I wouldn't think that would happen as frequently (since buyers can look for houses themselves and just ask an agent to schedule the showing), but I suppose there could be people who just blindly trust their agent.

As for what happens if both agents are from the same agency, that was specified in our contract (it went down a bit; I think to 2.5% each perhaps?), so just ask what their policy is and push back if you don't agree with it. There was also a clause in our contract about charging $250 or the like if we cancelled our contract before I think 6 months. It's fairly standard, so we just left it in, but that's something you might also want to look for and/or question.

We've also looked into just listing ourselves, or getting a flat-rate agent, but then we'd have to either be available to show the house ourselves or make it clear in the listing that we'd only show at night and on weekends, and we weren't sure if that would hurt us somehow (we ended up being about 50/50 on showings during the weekday and weekends).

Good luck!

pl28

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Re: Fair Realtor Commission
« Reply #4 on: September 15, 2015, 08:28:56 PM »
When we sold our house, we found a discount rate seller agent, we took our own photos and he help us write the MLS posting and he also handle the paper work. We pay him 0.03% + plus $500 MLS fee and buyer agent 2.5 percent (our house sold for 600k). I believe 5% is reasonable and most agents in our area will not hesitate to list for that. 

ShoulderThingThatGoesUp

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Re: Fair Realtor Commission
« Reply #5 on: September 16, 2015, 03:53:25 AM »
You could try selling via Redfin, they do a commission "refund" so in effect you're paying a lower commission.

Axecleaver

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Re: Fair Realtor Commission
« Reply #6 on: September 16, 2015, 02:46:52 PM »
Quote
You can ask your listing agent to reduce their fees to 2.5% or 2% and see if they're willing to negotiate, but I've read that if you drop the buyer's agent fee, sometimes they'll just opt to skip over your house to another with a higher fee (more money in their pocket!).
This. Most contracts will split the fees to buyer and seller. I think it's worth it to pay 3% to a guy who brings a buyer to the table. I have always been uncomfortable with 3% to a listing agent, especially today when all of the marketing is automated. You can do a 5% commission, but insist that it's split 2% listing agent and 3% buying agent. If your realtor provides the buyer, great! He can take all 5% off the table.

I chose to sell my house recently by listing it on Zillow(for free). Had an agent in my driveway within 24 hours, with a client who was interested.  I told him I'd pay him 3% if he could deliver. In five seconds, he went from working for the buyer to working for me. Best $9k I ever spent.