Is 6% commission too high? (Fairfax: mortgage, credit, real estate)

[Greatday]

Originally Posted by ggjacobsen

You get what you pay for. If you want to pay only 3%, that's all the realtor service you will get. If you pay the standard 6% you will get the full package. My question: are YOU willing to work for half pay? Then why expect a realtor to work for half pay?

What standard 6% commission?

There is no such thing

[Margery]

Originally Posted by sunset bound

thanks everyone, that's very helpful. I know that the commission is negotiable and that there is no "standard" per se, but I just want to know what *most* realtors, i.e. the big ones, charge. i am happy with my agent so far, and have asked her what she does to market the ppty. she places it one 3-4 different websites, does brochures with pictures, and of course will do an open house. i was very concerned about staging b/c we have renters there now, but she said that by law they can't do any staging when the ppty is occupied by tenants. unfortunately, the tenants furniture is not overly attractive so i am a bit worried, but it's a great house in a fabulous area so hopefully it's charm will speak for itself.

i am considering asking her to take only 3% if the buyer has no agent though. any opinions on that, or what i shared in general? thanks again to all who responded!

edited to fix typos!

The fee you pay the listing broker is for bringing a buyer, which is shared with the buyer's broker as an incentive for finding a buyer. Any buyer that comes without an agent is going to expect you to lower your sales price accordingly and your agent will still have to do the work that a buyer's agent would have done. Why would you ask her to do twice the work for half the pay? Of course you can negotiate the total commission paid, but be reasonable, this is how she makes her living.

[sunset bound]

Okay, okay. Point taken. I will not ask her to take only 3% if there is no buyer's broker. I appreciate the honest opinions. I may, however, simply *ask* her if she would lower her fee, if that is a reasonable question. Thanks again for your help!

[arlingtonChris]

Has anyone tried Redfin.com ? They advertise that they charge a fixed fee for selling your house ($3,000) and also refund you 2/3 of the buyer's agent fee if you buy through them. I'm sure you don't get the same level of service that you'd expect from a normal agent, but if you're familiar with the area that you're interested in then I don't see what having an experienced agent really buys you.

[Zack]

The big thing if you do try and get a reduced commission is to make sure there is 3% on the buyers agent side. It's not legal, but a number of agents won't steer buyers to your property if they are only getting 2% or 2.5%. In a booming market it doesn't matter much since the homes sell themselves, but in a slower market you don't want anything to possibly keep a potential buyer away from your house. Consider if it's really worth saving a few thousand dollars if it takes an extra month or two (carrying costs, stress, etc.) to sell.

Also think of the quality of the agent you are getting that will work at a discount. It's probably someone who is working on volume or can't attract much business and might not do the things that will get top price for your place; an agent on 2% commissions has to sell 50% more than on a straight 3% to equate their salary. I'm not saying that every 6% agent is great or every discount agent is bad, but I don't know a lot of really great agents, the ones who have your best interest at heart, that work for a discount.

Really take a look at how much you are "saving" to see if going with a discounted agent is worth it.

[sunset bound]

zack--thanks for your post. you made a very good point and i may just leave it at 6% then. Thanks again!

[McScootch]

Originally Posted by Zack

The big thing if you do try and get a reduced commission is to make sure there is 3% on the buyers agent side. It's not legal, but a number of agents won't steer buyers to your property if they are only getting 2% or 2.5%. In a booming market it doesn't matter much since the homes sell themselves, but in a slower market you don't want anything to possibly keep a potential buyer away from your house. Consider if it's really worth saving a few thousand dollars if it takes an extra month or two (carrying costs, stress, etc.) to sell.

I've never understood that. I'll admit the basic premise sounds right.."Why bring a buyer to this house if I am only going to get 2% instead of 3%). BUT, here is where I get hung up on that train of thought.... everyday another agent bites the dust in today's market, they simply cannot keep afloat in today's lull.

That said, you would imagine that if there was an opportunity to make money, ANY MONEY, no one would turn there nose at 2%. If you are not listing or representing the 10 buyers a month you are used to in the recent market, then why on earth would any agent snub a 2% commision? It is still income, right? Not as much as 3%, but guess what, its better than ZERO!

[bjbond7]

My husband is a realtor and works very hard. He works 7 days a week. Do you give you boss a discount for the work you do? We have a family to feed too. I guess I get pretty upset at this because there are people out there who will try to pit agents by saying he will do it for 2.5 can you do 2% and the agents who work for that have made it hard for the good agents. I know this is not what you were doing but just had to comment. In this market you are going to have to pay 6%. My husband worked for Mcearney and is now with Remax. It does not matter what company you go with it is all about the realtor and how hard they work for you. If interested in meeting with him let me know.

[McScootch]

I dont agree with that, you will not have to pay 6% in this market. If you find someone who has stumbled upon the hidden secret of selling your house in the time frame you expect and has proven themselves time in and time out then, yes you will be required to pay 6%, otherwise there are plenty of people out there willing to work just as hard for that sale and willing to do so for less than 3%.

BJBond7, You shouldnt be offended at people trying to get the best value for their money. They are paying for a service and they will try to get that service at a discount.
It's similar to car sales.... you dont hear any car saleman's wife complaining that people are negotiating a better price do you? The price of goods and services will always be negotiated.

It is all about expectations. Say I hire a real estate agaent to sell my house.... why should that agent receive more money for selling my 500k home that is appealling to the majority of the shoppers and will require less work for the realtor to sell rather than a run down townhome for 150k where he is going to have to beg, plead and bargain with anyone to come look at this investment property??

By the way, he has done more work to sell that 150K townhouse to earn $4,500.00 than he has to sell my 500K house to earn $15,000.00. Working harder for less? It seems like it to me.

[McScootch]

BTW, if that 500K house was sold at 2%, the commision would have been 10K