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This is not a trick question, nor is there necessarily a right or wrong answer.
I'm interested to understand how people (both consumers and agents) perceive who is paying for the buyer's agent commission so please submit your poll response just based on your initial view. The scenario that I'm asking about is the typical arrangement where there is a seller's/listing agent who puts the house on MLS offering a commission split with buyer's agents/brokers. For example, 6% overall commission with an offered buyer's agent commission split of 3% (agents/brokers split commission 50/50 in this example).
Please select the statement thatmost closely describes your view of who pays for the buyer's agent commission. Responses are anonymous.
Last edited by just_because; 08-07-2017 at 03:57 AM..
Of course buyer's agency is a buyer cost embedded in the price and increasing the price.
"Seller pays?"
Just like Dad (Buyer) giving his 6 year old (Seller) $10 to buy Mom a birthday gift, and the kid giving Mom a nice gift and proclaiming, "I paid for it myself!"
Surely Dad knows he is $10 lighter than he was before they went to the store....
Sellers and their agents want to claim the expense to justify their price, as if they are falling on a sword, but it is a nearly direct buyer expense.
"Buyers agency is free" is one of the biggest lies supported by NAR Code of Ethics and the CFPB, and is bought into by consumers who fall for the concept because.... Who doesn't like a freebie?
Some Buyers agents capitalize on the lie in their advertising.
Last edited by MikeJaquish; 08-07-2017 at 04:36 AM..
This is the chicken or the egg to me. Commission negotiated by seller and paid from sellers funds. There is no commission without the buyer. Technically the list agent pays the co-broke according the MLS. All sides have a reasonable point.
I agree that this is like the proverbial "chicken or the egg" type question. Technically, it is the Seller's Listing Broker that pays my commission, since I have no written agreement with the Seller to pay the commission. The Seller is (oftentimes) on the hook to pay the full commission whether or not a Buyer's agent is involved--so it is the Seller's cost.
As a Buyer, I don't really care what the Seller's costs are or what they ultimately net on the sale. If they signed up to pay a high commission, that's their problem. I have a maximum price I will pay regardless of whether the Seller will be paying a high or low commission, or whether they will be paying a commission at all.
Of course, it is the Buyer's funds which enable a deal to take place, but when I buy a property which is listed for sale at a set commission, the commission amount I would receive is credited against my purchase price. Likewise, I will sometimes rebate some or all of a commission to one of my clients, lowering their purchase price via a credit. I just rebated $6,000 on a sale last week--the equivalent of lowering their purchase price by $6,000.
To me, it's the Seller which bears the cost of the commission (that's why people prefer to sell FSBO if they can) with the technicality that the Buyer's agent's commission is, in fact, being paid by the Listing Broker.
Food for thought: if it's the Buyer who is paying the commission, then the amount of the commission agreed to in a listing agreement shouldn't matter to the Seller. They might as well sign up to pay a 20% commission rate. After all, the Buyer is paying for it, right?
Food for thought: if it's the Buyer who is paying the commission, then the amount of the commission agreed to in a listing agreement shouldn't matter to the Seller. They might as well sign up to pay a 20% commission rate. After all, the Buyer is paying for it, right?
Sure. Pump up the Property Price!
And specify cash deals only with no appraisal, and a 20% nonrefundable Due Diligence Deposit with any Offers!
Well, unless you refer to internal rumblings of realty reality?!
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