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Well you are talking about the industry. 10% of the agents make almost all the money. The typical agent closes a few deals a year and makes about 40 grand. It’s only a lucrative field for those very few talented agents at the top of the heap.
Plus you cite the single closing of a $500K house at 3%. First of all, in most markets it’s more like 2-2.5%. Second, you failed to cite the many listings that don’t sell and the many buyers that don’t buy. For which you spend gobs of hours and also items like gas for the thousands of miles you might drive. And for which you get paid how much? Nothing!
Not saying it’s a terrible business, it’s actually amazingly fun. But it’s not the gold mine you might imagine for the vast majority of agents.
I think our market is Colorado is very lucrative for even the mediocre agent, given the movement of inventory.
I put in my listing that if I have both buyer and seller, i will reduce commission to 4 percent. But i also explain that it limits what i can do for them or tell them. I will usually suggest to a 1st time seller, that it might benefit them to allow me to get any buyer that I find is unrepresented, their own agent. Especially if buyer is a 1st time buyer.
I like working both ends in a way, because I don't have issues with an agent that is bad about responding, or uses a lender that does poor prequals, doesnt follow up on loan status, etc. But it bothers me to not be able to provide as much info or help as I might otherwise do when it comes to negotiating.
Hello, if we put our place on the market with a realtor, whereby the usual commission is 6%, is it fair to ask the realtor in advance of signing any contract that if she happens to bring the buyer to the table as well to lower the commission to somewhere between the 3% and 6%. I am thinking a 4.5% commission is fair in such a case, instead of 6% to her on both ends.
Thoughts?
Simply make the deal on the commission percentage at the beginning. Regardless who brings what to the table you pay a set percent on the sale
I think our market is Colorado is very lucrative for even the mediocre agent, given the movement of inventory.
The "market" is local.
Denver Metro is where I work, and most brokers don't make more than $30,000/year.
Very few make more than $100,000/year (before expenses.) There are about 35,000 licensees in the state. 23,000 in the Denver metro area.
The front range has 4ish markets - Ft. Collins to Loveland & Boulder, Denver, Colorado Springs, and Pueblo.
Then there are mountain markets, Grand Junction, and smaller eastern plain markets.
Hello, if we put our place on the market with a realtor, whereby the usual commission is 6%, is it fair to ask the realtor in advance of signing any contract that if she happens to bring the buyer to the table as well to lower the commission to somewhere between the 3% and 6%. I am thinking a 4.5% commission is fair in such a case, instead of 6% to her on both ends.
Thoughts?
Commissions are always negotiable—I have found it very useful to breaking a repairs impasse. Some money is better than no money.
Keep one thing in mind. No agent makes any money if the home is not sold. Buyer Agent, Sales Agent, Secret Agent, will be pushing for the sale to be made versus really "looking out" for your best interest.
Not sure if my figure is correct anymore but in over 95% of the sales, the listing agent will not be the sales agent.
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