Who Pays the Real Estate Commission?
Who pays the real estate commission?
that’s today’s topic and we’re getting started right after this!
Hi everyone, welcome back to my channel. I’m Kim Ward Realtor with Horizon Real Estate in San Diego California. If this is your first time visiting my channel go ahead and hit that subscribe button down below, and ring the bell! So that you get notified of my future videos, and if you want to laughs stick around to the end my video editor loves to add bloopers of me.
If you are thinking about selling you may be wondering “who pays the real estate commission?” Real estate agents are paid for the services they provide in a transaction based on Commission that is a percentage of the total selling price. It is usually paid by the seller and one question that always is on seller’s minds is “HOW MUCH?”
Commissions are negotiable the typical commission rate is between 5% and 6% of the actual sales price of the home. The Commission rate can reflect the level of help or service and expertise of the realtor you choose to help you prepare, market, and to successfully sell, for the most money quickly!
When you choose your real estate professional to help you you’ll both agree in writing with a listing contract and part of the listing contract is the total Commission agreed between you and your realtor. A portion of that agreed-upon Commission will be offered to the buyer’s agent. Here is an example of commission, assuming 5.5% total commission, with 2.5% being offered to the buyer’s agent, that means that your Realtors commission is 3%. Keep in mind for that 3% your Realtor is believing that they can sell your house and they don’t get paid not one penny until they get the job done (So, they’re taking some risk).
Your Realtor is believing that their time they put into preparing marketing and successfully selling the house will reimburse them when they get what you want, a sold house! You may be wondering “how can I save on the real estate commission?” with a full-time, full-service realtor sometimes all you have to do is ask!
Here’s a tip the way the agent responds could be your best indicator of how skilled they are in negotiating. If they don’t have the ability to negotiate for their own fee, their own commission, consider what may happen when it comes time to negotiate for you (just something to think about!). So, let’s quickly talk a bit about discount brokerages, you know the 1% Commission places, how do they do it? Maybe by;
- doing less marketing
- by being less available for buyer’s agents
- by providing less actual help for you!
What kind of help? Many of my clients don’t live in San Diego, and they choose to get a better selling result by preparing the home. A realtor that manages the preparation is giving a lot of additional time towards the best result for you should be compensated (don’t you agree ;-)).
You definitely want to be careful and aware of sales tactics and gimmicks when searching for your listing agent. The great news is that everybody wants your business! Please consider the following:
- you may want someone who will provide help with the preparation especially if you don’t live in San Diego
- if you do live here you, you may not have the time to manage the preparation yourself…
- Cost-effective repairs (painting, flooring, yard work, house cleaning)
- Providing staging expertise and items
- Rearranging furniture to maximize the space
- Items such as window treatments towels accessories
- Paying for professional photos
- Signage, flyers, lock boxes
- Someone who has assistants that answer the phone
- Or, reply timely to emails to schedule appointments and to address any questions about your house
- Someone who will take the time and have the skill to verify a buyer’s ability to actually qualify for a loan to buy your house
- Plus, negotiate on your behalf with buyers and their agents once in escrow
- An agent that will attend the buyers inspection
- Meet in person with the appraiser to avoid appraisal issues
- And, just as important keep you informed throughout the transaction by updating you regularly!
remember we get what we pay for! And, experience shows that when working with a skilled professional with a strong track record of performing well is a great option! Bottom-line is you want to sell the house quickl,y and for the most money!
Hope this video helps to explain real estate commissions better. If you found this of value please hit the thumbs up, I’d love to answer any questions or to hear your stories! Call or email me at: 619.741.0111, Info@HorizonRealEstate.net