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In my area listing agents like to ask for 6% commission but usually take 5% if that's what the home seller will pay.
Assuming that the listing agent isn't also the Buyer's agent when it sells, ie; dual agent, how does the commission split break down between Broker, listing agent, and Buyer's agent?
I want everyone working hard to sell my house but prices are down and I need to trim my costs and fees, or else why bother.
Will, trimming your cost by asking an agent to give up one third of his earnings is not the best way to net more money for your home.
Usually it is the agents who are hungry, and don't know how to market as well and negotiate as well, who are willing to give up one third of their pay to get a listing. That agent can cost you money.
It's been written in other threads that some agents will either accept a discounted fee, or will tell you that they can get you more money for your home (they can't) in order to get your listing.
What you need is to find the best agent available who can show you her market plan and demonstrate to you that she is the best for you. The agent should show you the comps for the Actives, Expired, and recently Sold homes, and should explain that you need to be priced at the bottom of those prices, and priced competitively with the Actives.
If an agent tells you that you can list your home higher and sell it, then that agent will net you less money. The reason is that the home will not sell, and you will have to reduce the price, and chase the market down.
The third through the fifth week usually bring the most traffic because the listing has been discovered, and it's new on the market. That is when the home should be priced right. If it's too high it won't sell, so in the fourth or fifth week you will have to reduce the price, and you have missed an opportunity to sell when the traffic is highest.
If you listen to the agent that has a great market plan and tells you that you must list it competitively (this is what you don't want to hear) in order to sell, that agent will get the home sold faster and at more money than you would have gotten from the agent who promised you the pie in the sky at a discount. You will net more money.
As far as the commission split among the agent and his broker, you need not be concerned with that.
You need to be concerned with how much your listing agent is offering to the Buyers agent.
If the commission is 6%, then he should be offering 3% to the Buyers agent. If his fee is 5%, he should still be offering 3% to the buyers agent, to make sure that the house will be shown. Agents are supposed to show all houses regardless of the commisison amount, but we know that some will not show a home if the commission is less than 3%.
Your listing agent is the one who will be taking the financial risk. He will be investing money into marketing your home to bring it to the attention of buyers and agents so it can be sold. If it does not sell, then that agent loses all of the investment of time and money. So why would you want to take away some of his incentive by asking him to take one third less pay?
Thank you Captain Bill. I always learn from your posts.
I've sold two other houses in this locality in the past eleven years. Both times I paid 5%.
The house I'm selling next month will list at $195K. I have to pay the $12,000 commission at 6%, $900 sales tax stamp to the state, $700 for Title 5 septic test. I'm probably going to skip the lawyer. Minimum $2k to mover.
I'd like to get out with something, ie; new underwear, or a few bucks for dinner that night. In part, I might ask them to take less commission because so many were greedy on the way up. I'm not paying for plumbers and carpenters now either.
Thank you Captain Bill. I always learn from your posts.
I've sold two other houses in this locality in the past eleven years. Both times I paid 5%.
The house I'm selling next month will list at $195K. I have to pay the $12,000 commission at 6%, $900 sales tax stamp to the state, $700 for Title 5 septic test. I'm probably going to skip the lawyer. Minimum $2k to mover.
I'd like to get out with something, ie; new underwear, or a few bucks for dinner that night. In part, I might ask them to take less commission because so many were greedy on the way up. I'm not paying for plumbers and carpenters now either.
I hope you're able to come out well on the sale. I just signed a contract on my CA house and it didn't get sold during the three years of not being our primary residence. We put it up for sale early, but then the slow market hit. So after paying off the large mortgage (we had refinanced to do other things) and paying federal and state tax, we may not have dinner money.
My accountant will be trying to get us in under the "unforseen circumstances" provision of the IRS rule. We had the home on the market in time for it to sell in a normal market, but very soon after being listed, the market in that area came to a screeching halt, and we went beyond that 3 year period.
Such is life. Our agent out there was marketing very heavily, and it was an upgraded home in a highly desirable location, but the buyers were just not there.
Thank you Captain Bill. I always learn from your posts.
I've sold two other houses in this locality in the past eleven years. Both times I paid 5%.
The house I'm selling next month will list at $195K. I have to pay the $12,000 commission at 6%, $900 sales tax stamp to the state, $700 for Title 5 septic test. I'm probably going to skip the lawyer. Minimum $2k to mover.
I'd like to get out with something, ie; new underwear, or a few bucks for dinner that night. In part, I might ask them to take less commission because so many were greedy on the way up. I'm not paying for plumbers and carpenters now either.
You can also try FSBO and offer 3% to the buyers agent and get a lawyer. You will still make more money and I had an agent and had to show the home myself, so I'm not going to pay an agent anymore if I have to show the home myself. As a realtor mentioned "buyers agents are greedy" so to have your home sold, you need the buyers agent more than the sellers agent since the buyers agent brings the buyer not the sellers agent. I would only use a sellers agent if he/she will put in writing how much adds they will run and what else they are willing to do to sell my home. Just list a home and put it on the MLS is what everybody can do themself so to use the help of a realtor and pay a lot of commision , the realtor should show that they will work for it. It isn't 2004/2005 anymore.
Please explain what that would mean to us in Colorado, where we have been slow and stable since 2001?
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