He's most likely going to be making a nice commision already, as I am buying a new place at the same time. I know there is a range, but give me some numbers so I know what is reasonable.
2007-01-23 10:54:54 · 8 answers · asked by nikayw 2 in Business & Finance ➔ Renting & Real Estate
i guess that you mean that he will be your buyer's broker for the new house. meaning, to you, that he will get one half of THAT commission?
just to let you know, the pie gets cut up into smaller numbers. the brokerage house that he works for will get one half and he then gets whatever he and his managing broker agreed to, as his "split" in their broker-salesperson agreement. let's pretend that the total commission THERE were 5%, and your sales amount is $200,000. 5%, paid by the seller to the listing broker (who then pays her salesperson some part of that), is a total of $10,000. if your buyer's agent gets 50% of what his "house" takes, then he gets $2,500--which, all things considered, isn't that much considering that he does not get a commission once a week or anywhere near that.
the feds would call it "price fixing" if members of real estate boards in one location all agreed to charge X% commission, so commissions are ALWAYS negotiable between broker and the hiring party. i.e., there is no specific percentage that all of the brokers charge on residential property. it may be common in your location that they charge 6%. since almost 99% of the time, your listing agency is not the one that brings in the buyer, it means that half of the 6% you pay to your listing agent (your brokerage house, under which your agent hangs his license) is going to go to the brokerage house that produces the purchaser.
the total amount you'd pay when you close would be $10,200 if your purchase price IS $170k. so now, divide $10,200 by 4, and that will tell you how the pie is usually split. it means that your sellng agent, his broker, the purchaser's agent and her broker all take 1/4 of that amount.
please do not begrudge what you pay for brokerage: you have no idea how much money agents have to pay just to stay in business until the next pie comes along. ads cost a lot, so do phones, offices, assistants, bookkeepers, the multiple listing service, and on and on. the agents and brokers have families to feed and cars to pay for and a home to keep up, just like you do. only their income comes in in chunks, and those chunks have to be very carefully managed so that they can continue to make a living by HONESTLY and FAIRLY and ETHICALLY representing YOU, who is the boss. just make sure that you are working with one that knows how to explain what the concept of "agency" means to him. then apply it to both him helping you purchase and to helping you sell.
may you always have a happy home.
2007-01-23 11:52:13 · answer #1 · answered by Louiegirl_Chicago 5 · 0⤊ 0⤋
There are no legally set fees for real estate commissions. (at least here in California). 6% is the going rate but that is negotiable between the agent and his client. As such, there may be a different amount negotiated for a very expensive home vs. a small shack. But that is not a given. All things being equal.. if the commission rate stays the same then yes, twice the house value = twice the commission. The difference in your example is that the MacD or the Ford worker is not paid on the volume of his/her sale but on an hourly wage. That person gets paid if they sell NO frenchfries or fenders. The commission concept means that the agent is motivated to sell the property for as much as possible since they will then receive a greater commission. Obviously there are many common elements in both sales, but selling a small shack can be just as hard as a large mansion since you are dealing with different levels of buyers. While I agree that the concept of a flat commission rate is flawed, it is very tough to buck since, if you want a good an agressive agent who will sell your property quickly and at the best price, you have to pay for it. .
2016-05-24 02:09:12 · answer #2 · answered by Anonymous · 0⤊ 0⤋
The commissions are negotiable and don't be afraid to negotiate on it. Interview more than one realtor, and make sure that they are in fact a realtor not just a real estate agent. Realtors are better because they are members of the State and National Association of realtors.
What many realtors will do is offer you a discount on the second home that they represent you on. Get it in writing and I would only sign a 90 day listing. That way if things aren't going well you can switch.
Very best of luck
2007-01-23 11:08:49 · answer #3 · answered by Anonymous · 0⤊ 0⤋
5 to 6% assuming that he shares the fee with another agent. The scale moves as the price goes up. Keep in mind that this is $8500 to $10,000. That gets split between two agents, then the house gets a chunk, then the desk charges and such. Whatever is left is subject to income tax, state income tax if applicable and self employment tax. Everyone thinks that agents make tons of money, some do. Keep in mind that there is no other pay, no other benfits, associated with the job.
2007-01-23 11:05:43 · answer #4 · answered by domainguy 2 · 1⤊ 0⤋
Depends on your area, but if you are in a soft market shoot for 5%...listing fees are definitely negotiable. If you have like an assist 2 sell in your area they do it for around 4.5% thats what they charged me anyway.
2007-01-23 11:09:43 · answer #5 · answered by miztiffany 3 · 0⤊ 1⤋
Most realtors want 6% however if you are buying from them I have heard of realtors who will go down to 3%.
2007-01-23 11:03:47 · answer #6 · answered by Answerman84 2 · 0⤊ 1⤋
5-6% Its worth the fee to not have all the head aches that go with it.
2007-01-23 11:03:04 · answer #7 · answered by frankie b 5 · 0⤊ 0⤋
shouldn't be anymore than 6%. i believe it should be less than $10,200.00. i am probably embarassing myself and should use a calculator - i hope not! lol
hope you find a great home! SD
2007-01-23 11:05:04 · answer #8 · answered by SD 6 · 0⤊ 0⤋