when selling real estate does the realtor get 6% of the entire purchase price?

Answer 1

Commissions are not fixed, and you should not believe anyone who tells you that a certain commission is "standard", particularly not in the real estate market as it now exists. While years ago, a commission rate of 6% was the most common, the rate is part of the listing agreement that you negotiate with a Realtor - and the rate can be anything that you and your real estate brokerage agree upon.

Because the traditional "one size fits all" model of real estate brokerage agreements is becoming increasingly less popular with sellers, many brokers now offer "a la carte" services, a system that alllows you to pick and choose the services that your Realtor will provide. Some brokerages are so-called "discount" brokerages, that advertise smaller commission fees - other brokerages may agree to charge you an hourly fee for the services they actually provide.

Keep one thing in mind - almost all Realtors are paid strictly by commission - they don't receive any other wages, and only earn a paycheck when they successfully complete a transaction on behalf of their client. When a transaction occurs, any earned commissions are split, not between the seller's and buyer's agents, but between the seller's and buyer's brokers. The brokers have a private arrangement with their sales agents to share the commissions.

I mention this specifically because the appeal of finding an agent who is willing to help you sell your home for a low commission needs to be balanced against the inescapable reality that buyers' agents look at the offered commissions before deciding which properties to show their clients.

For example - a 6% commission on a $200,000 home is $12,000. Typically, that would be split evenly between the seller's broker (not agent) and the buyer's broker - $6,000 each. Let's say the agents have a 70% "split" with their broker - if that's the case, each agent would wind up making $4,200 on the sale (the brokers on each side would pocket the other $1800, which goes to pay the broker's overhead plus profit.)

Let's say a realtor is approached by an buyer who asks for assistance in finding a home. Suppose there are three identical homes the realtor could show the client in the same community. One home is offered with a 6% commission, a second is offered with a 4% commission, and the last is advertised with a discount brokerage's 2% commission.

Be honest - which property do you think the Realtor is going to show? The property where he/she stands to make $4,200, the property where the potential commission is $2,800, or the home whose sale might earn the agent $1,400?

An appropriate commission is partially determined by finding out what other similar homes in your community are being offered for. If your commission is competitive with other similar properties, your home has a good likelihood of being shown. If your commission is slightly higher than other homes in the area, you may see more showings than average, and possibly a faster sale. If the commission that you're offering cooperating agents is below other homes in your neighborhood, you may well experience fewer showings, and a longer time on market.

The "right" commission depends on several factors - what you can afford - how quickly you need to sell - and what other, similar homes in your area are offering. Talk to several agents and let them know that you're looking for the best (but not necessarily cheapest) deal. Let them tell you what they're going to do to get your home sold - and go with the agent who you feel most comfortable with.

Answer 2

What ever the commission is on the listing contract is what the commission to be paid is, a percentage of the selling price. You pay that only at closing unless there are circumstances in your listing agreement that state otherwise as in unusual circumstances.

Due to Sherman anti-trust laws licensed real estate agents are not allowed to discuss their firms brokerage fees with outside brokerage firms or set commissions collectively as OPEC does. That is anti-competitive and against the Sherman laws. Commissions are based upon that brokerage firms cost to do business. Where does the commission go? Example: of a 6 % fee 50% goes to a co-op agent who assisted with the sale, leaving 3% to go the the listing firm. Then of that, one third goes to expenses, one third to the brokerage and the rest to the agent who then has to pay taxes. I assure you there is much more to selling property than driving around all day showing homes. That is just a part of it but not all of it.

A good licensee (not all licensees are Realtors) will earn their fee. Unfortunately there are also those that do not. 20% do 80% of all sales. That is not to say 80% are bad or not earning their fees. But the more successful have mastered the use of technology- lap tops, digital cameras, email, website, etc. and therefore can handle more business. Any licensed agent you employ should present you with their marketing program in writing and review it with you.

Do not hire your agent based upon his commisson or because his proposed list price is higher. List with the agent who has demonstrated competentcy, knowledge of the area, one who can advise you on what the market is doing and what buyers expect. One who also will review with you the things you need to do to get ready for presenting your home to the public and how they will get the job done.

Many times I have saved sellers money even though my commission is a little higher than some because I coach them in what we need to do, assist in getting things set at affordable prices if they are unable to do things themselves, and would usually get the job done in substantially less than typical market time.

I am the manger broker of my office, and have to train new agents. When working with sellers or buyers we have a crash class in Real Estate 101. It is my job when I list your property to provide you with the best knowledge and information available so that when decisions are made they are great decisions. I was rated #7 out of 800+ agents before I went into management in 1999.

My staff typically will outsell our other offices on an average per agent basis. Our clients are super and many will not do one thing with real estate without consulting one of us first. We earn our fee, get the job done and done well.

You may also ask for referrences, they should not hesitate to provide them. Ask too if the real estate commission or regulatory agency has ever fined them and if so what was the offense. A home is the most important investment most people will ever make, you want somebody that is in good standing with the license department of the state- not a "bozo" that can't even renew their license timely. And ask for a full licensed broker, they cost approximately the same in gross commission but are much better trained in getting you top dollar and the job done right the first time.

Answer 3

Realtor/agent typically splits that (oftentimes 4-ways).

Realtor has errors/ommissions insurance to ensure you get treated right -- it costs money.

Realtor drives people around and answers the phone in the middle of dinner, on Sundays and holidays with the hopes that someone isn't going to waste half their day and not buy or sell with them.

Realtors need frequent certification to stay up with legal issues in their particular state.

How funny! You'd think I was a realtor -- I'm not

Answer 4

The Realtor's firm gets the money, the Realtor gets a "share" of it.

Answer 5

Generally but you can look at other options such as working with an "exclusive" which can sometimes drop the percentage to 4%. You can also sell the house direct with something like BuyOwner.com which might save you some cash.

Answer 6

That is the typical commission. They have to split it if the buyer uses an agent.

Answer 7

It depends on the listing contract. Commissions are always negotiable.

Answer 8

yes exactly and thats 6 percent if you are lucky some are 8 percent

Answer 9

Usually it is split: 3% per Realtor.
It is negotiable.

Answer 10

Try this website

http://www.realtyhelpusa.com