Real Estate commission (for sale by owner, broker, how much)

[JB00JB]

What is the going rate for real estate commission? I understand discount brokers charge less, but is 4% or 5% reasonable for a full service realtor?

[Belmarin]

Probably 5-6%

[London]

We paid 6% on a house we closed on in Chicago this April, but I think some realtors will accept 5%.

[naeem5]

Originally Posted by JB00JB

What is the going rate for real estate commission? I understand discount brokers charge less, but is 4% or 5% reasonable for a full service realtor?

My house is under contract as of yesterday.
My selling agent was "called" by a looker 1 time out of the 7 showings.
If my agent had found the buyer, such as the above phone call, the commission would have been 5%.
If another agent finds my buyer, which was the case, it is 6%.
My agent can arrange for you and her to work together with you "selling by owner". I think the commission is 3%. She does the same things basically to help you sell, but you are active as well.
As far as me, my commission would have been 5% if I had found my buyer, but really my only source would have been to advertise on Craigslist or word of mouth or luck.
There was a thread somewhere about an owner wanting to know the ins and outs of FSBO. Well, if your looker brings their own buyer's agent, the seller pays the 3% commission. I found it worth the extra 3% to let a pro handle my sale.
I had mine for sale by owner with nothing but a sign in the yard for 4-5 weeks. I got phone calls from people wanting to list my house on their site for $299. I got mail solicitations fron agents who spend some of their time riding thru neighborhoods looking for FSBO.

I never looked into discount brokers. I was told in Az. there are zero real estate agents. They are called "brokers". I've never heard the word broker used around here, related to real estate.

A full service real estate agent is 5-6% depending on who finds the buyer. That is what I was told by my agent who helped me sell and is helping me buy. The seller always pays the commission for both the buying and selling agent. Other seller costs are deed stamps and legal fee of about $150 and the property taxes up to closing, which are your expense any way, whether you sold the house or decided to live there. Other seller cost are the buyer asking you to contribute to their cost.
I got an unusual offer, they asked for me to pay 0 of their closing cost. They did ask for the refrigerator so I let it go.
I could encounter cost if the inspector finds something or the appraiser or pest inspector find something and the buyer's expect me to pay it or share it. I accepted their offer with no restrictions, so if some issue comes up they've been hinted not to expect me to bend. I bent over backwards to accept their offer.

The 6% is split 4 ways so I doubt you find lower around here.
1.5% to each agent and each of their agencies.

[EliseTimpe]

Realtors aren't allowed to even hint that there is a "going rate" for commissions. Saying there is could cost them their license. Commissions are negotiable between sellers and their agents/brokers.

Each agent or brokerage decides what they need to charge in order to maintain a profitable business.

However, it is helpful to understand how the commission incorporates into the transaction.
First off, you and your agent negotiate a commission. Then, the agent puts your listing on the MLS. The MLS is actually like a "help wanted" ad service between Realtors. This is true because we can not list a property there with "0" commission. There, listing agents offer a portion of the negotiated commission to any agent who can produce and represent a buyer for the listed property.

If you interview 3 agents, you'll get a good idea of what commission you can expect to pay. A word of caution....don't select the Realtor on the basis of how much they say they can get for your property. That is called "buying the listing". Some agents will play off your desire to get the most money so that you will choose them. They know full well that they'll be having you reduce your price after you see, first hand, that your home is only worth what a buyer is willing to pay regardless of the Realtor. That can be assessed with a Comparative Market Analysis which each agent should provide.
The other common mistake sellers make is going with the cheapest commission. You get what you pay for. When agents see on the MLS that they will make less than they need if they promote your property to their buyers, they'll be less than enthusiastic about showing it. Realtors have no other income or benefits than their commission...they must even pay for your advertising, the sign they put in front of your property & the gas to show buyers out of that commission....

The third mistake some sellers make is going with the agent who says they have buyers.... so that agent brings the buyer or buyers....is it guaranteed that yours will be their dream home? Instead, pick the agent with the best marketing plan including Craigslist, YouTube, Realtor.com, Trulia, Zillow, etc. Your listing agent's first job is to market your home not only to buyers but to buyer's agents. It is the interaction of agents that gives them the power to find the right buyer.You want the most money you can get for your property. The way to get it is to expose it to the biggest pool of buyers. Once it is listed on the MLS, the agent's description and pictures will autopopulate to numerous websites for public display....if the agent includes lots of pictures and writes a good description that will help zero in on the right buyer and save you the trouble of showings to the wrong buyers.

I'm a California Realtor. Although the laws and process are different state to state, these things are the same.