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"Sales commissions for residential real estate brokers historically average nearly six percent of a home's closing price. Do brokers add sufficient value to justify those commissions? We address this question using a unique data set pertaining to sales of faculty and staff homes on the Stanford University campus. We find no evidence that the use of a broker leads to higher average selling prices, or that it significantly alters average initial asking prices. However, those who use brokers sell their houses more quickly."
What was your experience, did your realtor add enough value to your house sale or not? If house got sold quickly, was saving of a couple of month of house expenses higher than money you spent on commission?
"Sales commissions for residential real estate brokers historically average nearly six percent of a home's closing price. Do brokers add sufficient value to justify those commissions? We address this question using a unique data set pertaining to sales of faculty and staff homes on the Stanford University campus. We find no evidence that the use of a broker leads to higher average selling prices, or that it significantly alters average initial asking prices. However, those who use brokers sell their houses more quickly."
What was your experience, did your realtor add enough value to your house sale or not? If house got sold quickly, was saving of a couple of month of house expenses higher than money you spent on commission?
Realtor commissions are too high and so are closing costs. It's crazy.
We haven't paid 6% commission in a long while. We typically pay 3.5 to 4%, 2.5% to the buyer's agent, and 1% to 1.5% for our agent, with the caveat that we will use them to buy our next home, which is typically around the same time as our sale.
Once you get above the 5 million mark, commissions are typically lower as well, but obviously that applies to a very small subset of people. (We've never paid that much or sold a home for that much, but if prices keep rising...)
In a seller's market, which is what we've had for years now, you will find an agent absolutely willing to take 1%. We've also negotiated a structured fee scheduled on top of a base commission that agents like. Example, listing price is $1.5 million, if we sell for 1.3-1.4, it's the standard commission, but if we sell for higher, we do an additional 3-4% on any amount above the 1.4. Keeps agents from wanting to lower pricing and negotiating, also let's agents work out a deal between themselves to maximize their own commission, while getting me the most money possible. I would say doing that absolutely leads to higher selling prices.
Realtor commissions are too high and so are closing costs. It's crazy.
Yes and it adds up to a higher price, not a higher value, making both (seller and buyer) to lose more money. However, a good realtor can be an asset to get the job done.
"Sales commissions for residential real estate brokers historically average nearly six percent of a home's closing price. Do brokers add sufficient value to justify those commissions? We address this question using a unique data set pertaining to sales of faculty and staff homes on the Stanford University campus. We find no evidence that the use of a broker leads to higher average selling prices, or that it significantly alters average initial asking prices. However, those who use brokers sell their houses more quickly."
What was your experience, did your realtor add enough value to your house sale or not? If house got sold quickly, was saving of a couple of month of house expenses higher than money you spent on commission?
Do you not think that the sample only consisting of Stanford faculty, who have use of a faculty and staff housing office, might skew the data?
"Sales commissions for residential real estate brokers historically average nearly six percent of a home's closing price. Do brokers add sufficient value to justify those commissions? We address this question using a unique data set pertaining to sales of faculty and staff homes on the Stanford University campus. We find no evidence that the use of a broker leads to higher average selling prices, or that it significantly alters average initial asking prices. However, those who use brokers sell their houses more quickly."
What was your experience, did your realtor add enough value to your house sale or not? If house got sold quickly, was saving of a couple of month of house expenses higher than money you spent on commission?
Location: Sarasota/ Bradenton - University Pkwy area
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The estimated total pay for a Professor at Stanford University is $224,986 per year as of 2023.
The median gross income of REALTORS®—income earned from real estate activities—for 2022 was $54,330.
Perhaps it's time to take a serious look at how much academics are making at these large universities?
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