I saw on tv, a real estate guy sold a malibu house for almost two million and he got $173,000 for commission. He showed it too a friend for two showings and some paper work...how did the realestate percentage get set at current rates??? I will never get it. Rick
2007-01-26 13:33:50 · 6 answers · asked by ellonysman 2 in Business & Finance ➔ Renting & Real Estate
First off, even if he listed at a full 7%, that adds up 140K, not 173K.
Second, unless the buyer had no agent and asked him to be THEIR agent to (which rarely happens), he split that with the buyer's agent, lowering his commision to 70,000.
If he is an agent and not a broker, he splits that with his broker. He probably got about 60% or so of the 70K, which gives him $42K.
That said, million dollar home owners SHOULD NOT be paying 7% commissions. On most homes a 6% is MUCH more common, but on a million dollar plus home, the comision is structured differently-- usually 6% of the first 100K and then 4.5 or 3% of the rest.
A buyer's agent or a seller's agent almost always is making 3% since they each get half of the sale. An agent has to split it with their broker from there.
Also, Real Estate agents have LOTS of out of pocket expenses. I did it for a few months and hated it, and in 6 months it cost me over $1500 to get started, and I made one sale to break even and stopped. Not becuase of money-- just becuase i hated knowing I'd have to waste a lot of time without knowing if a sale would result. Agents get LOOKEY-LOOS galore.
And FYI--- Most properties don't take just two showing and that's it.
2007-01-26 14:16:30 · answer #1 · answered by Anonymous · 3⤊ 0⤋
Excellent answer Amanda. I couldn't have said it better myself. I've been a realtor for 7 years. Brokerage fees are still typically 6% with half going to the buyer's agent. In some areas a lower brokerage fee is standard. In LA, for example, the standard fee seems to be about 4-5%. In the desert, where I work, I very rarely accept less than 6% and in this declining market I often get 7% and offer 4% to the buyer's agent. It does seem like an amazing amount of money, but like Amanda said, the cost to market a home is also amazing and often does not result in a commission check -- especially right now when buyers are few and far between.
2007-01-26 15:01:04 · answer #2 · answered by Anonymous · 2⤊ 0⤋
My property was done at 6% but still, that was a lot.
It is just the default standard but buyers & sellers are free to request a lesser rate.
Also, that is why you see many listings that say FSBO (for sale by owner) and principals (no agents) only.
AND during the housing price runup , lots of people got into being agents but now there are not enough properties selling for them all to make a living at it !
2007-01-26 13:43:46 · answer #3 · answered by kate 7 · 0⤊ 0⤋
i'm a actual sources agent and have and nonetheless am energetic in view that 1979. i might say in case you haven't any longer offered and offered lots you would be money forward by utilising itemizing and promoting by way of a competent agent. On conventional now its pronounced 18% extra appropriate off even after paying fee.
2016-11-01 09:29:36 · answer #4 · answered by deliberato 4 · 0⤊ 0⤋
I paid 4%. It is all negotiable. I would check out the flat fee Realtors.
2007-01-26 13:54:33 · answer #5 · answered by Michael 2 · 0⤊ 0⤋
thats crazy...the regular r. e. commision is 4 -5 %...you as, a seller can set any price you want...you can say 2% if you want...but, they wont be very agressive at selling your house...
dont believe everything ok?
2007-01-26 13:45:22 · answer #6 · answered by Winters child 6 · 0⤊ 1⤋