Sorry, don't know that's yuou company who did the remodeling.

However, my second part of 'You don't kow that won't happen, do you?" goes wiith the part where you won't know the neighbor won't get $35K more than your friend when he sells; of course, unless you know something I don't know again. You are certainly much more an expert on that property than I am.

S- .

**..You and I don’t know the condition of ... You don’t know that won’t happen, do you?..**

Yep, I have a pretty good idea .. considering it was my company that did the remodeling ...


:^)

But now, Iman, you are talking about probability, not basic Math 101.

I never say that FSBOs can not be successful; and more power to your friend that he sold his house. We can dispute the probability and the ‘majority’ of that happening; and I won’t quote NAR statistics, because we both know you won’t agree with that so it’d be a waste of time.

As far as the $700K listing price vs the price suggested by the flat-fee agent he plans to work with; as I don't know the specifics, I can't comment. But you did say he is planning to use a flat-fee agent.

As far as the neighbor is concerned - You and I don’t know the condition of the neighbor’s house and/or when/if he sells, how much he might list and sell his house for if he does not use that flat fee agent. For all we know, the neighbor might come out $35K ahead of your neighbor. You don’t know that won’t happen, do you?

What IS interesting to me is that you did mention your friend will be taking in $700K; that he does not have to pay $11K to the agent, and that the neightbor will have to pay $35K commission - I might be wrong, but it seems to me it kind of says who you think really pays the commission.

O.K. back to work;; gonna earn that commisson. .

Sylvia

Kazeem: But if the commission is worked into the price, then it is actually the "buyer" that pays the commission. Correct?
~~~~~~~~~~~
Say the house sells for 350,000 and the seller has bills to pay that amount to 350,000. Who pays the commission, kazeem? That's right, the seller pays the commission.

**..Actually, often times, by the time those listings show up on MLS, the price might be lower than the oringial FSBO price. . **



.. Or, as in the majority of cases ... a friend in Florida just sold his house FSBO for $700,000 (asking) and won't have to spend that $11,000 that he contracted as a flat fee for the realtor because it's starts 04/01/2008 ..

So .. since the realtor thought his sales spread would be $660,000 to $675,000 .. it looks like he saved himself $11,000 in commish and "at least" another $25,000ish in roll down.

You betcha .. Beauty is all in the Eyes of the Beholders .. to the tune of $35 big ones.

This guy saved $35,000 .. the guy next door will spend at least $35,000 on a realtor to get there, that's a $70,000 swing .l.o.l..

reality math - 101



-

Absolutely, can't agree with you more :-)

A house listed on Craigslist for $600,000, FSBO. A few days later, a note says the seller will co-op with Buyers Broker at X% at $600,000. A month or two later, shows up on MLS for $600,000 and x% commission to Buyer Broker (MLS only shows co-op commission, assuming they pay listing agent commission also).

Actually, often times, by the time those listings show up on MLS, the price might be lower than the oringial FSBO price. .

Assuming full price offer, the buyers pays the sellers $600,000. Where does the commission comes from? 'PURE' Math 101 or not; Beauty is all in the Eyes of the Beholders.

I did have to look up what the whirling dervishes is though.

Sylvia

**..There are great debates about chicken and egg and we probably will never settle that..**


There is no great debate .. there is no chicken, there is no egg, hamster, glowing doorknobs or even whirling dervishes..

It's that plain old thing called: basic math 101 ...


: ^)

There are great debates about chicken and egg and we probably will never settle that.

However, the only thing is keeping an eye on FSBOs, I have not seen many that are FSBO to start with and their houses are priced lower than the market price (whether they co-op with buyer broker or not); nor have I seen many that after they chagned from FSBOs to listed with a Realtor after they give up on FSBO, that they raised the listing price to compensate for the commission the sellers have to pay now.

Sylvia

Michael,

**..But in the true nature of buyer brokerage the Buyer DOES pay their agent..**


Thank you for an honest and refreshing answer .....!


: ^)

Why is an alleged "Real Estate Pro" asking this question? Maybe this is a question for Trulia. How does one get the Trulia moniker of "real estate pro"? Is it a mistake a consumer can make when asking a question? Is it right below "Who are you? A buyer? Real Estate Pro?" However, If this is indeed a “Real Estate Pro” asking where the commission comes from it's allot like a gynecologist asking “where do babies come from”!!
WHERE does the commission come from? In a roundabout way from the proceeds of the sale which are supplied by the new loan or cash the BUYER is bringing to the table. WHO pays? Or better yet, who INSTRUCTS escrow to pay? If you look at most settledment papers in the greatest state of Calfornia, the SELLER is paying as it appears on his side of the sales expenses.
When the market was very hot we had some arrogant Realtor/Licenses stating NO commission to the Buyer will be paid by the Seller!! Yeah, I know, there's always one of these guys in every market isn't there!! But in the true nature of buyer brokerage the Buyer DOES pay their agent. Confused? Don't worry about it! Write up a listing saying the Seller pays, have them sign it, find a buyer, have them sign a contract stating the Seller pays and get all parties to sign. Close the escrow, get paid.

Max has a similar question here.

http://www.trulia.com/voices/Agent2Agent/I_am_a_new_agent_in…

Yes, net sales proceed for the seller is the purchase price minus commission, minus any closing cost, credit back. The commission will directly be paid through escrow to the listing agent's brokerage, not from the seller writing a personal check. . .

All the money went through escrow and the agents get their commisson check through the brokerage.

However, if you are talking about FSBO, then you have to get a special commission agreement from the seller; or if the seller does not do co-op, then you have to get agreement from the buyer if you are representing the buyer.

However, the bottom line is, you need to find a brokerage who will provide you with training and education before you start selling. I personally believe the courses we take to just get a liscence are really fundamental and do not really help us to become a great agent. Find and interview a few reputable brokerages to get started.

Good luck!
Sylvia

I am a broker located in a different state. I could tell you what is typical here but it may not do you much good. You need to speak with your broker.

But if the commission is worked into the price, then it is actually the "buyer" that pays the commission. Correct?

Khazeem Asadullah

Max,
the commission is usually paid by the seller. For example, if the seller is selling the house for $100,000 at 6% commission, at the settlement, the seller will pay $6,000 commission to the listing brokerage. The listing brokerage will then pay half of it ($3,000) to the selling brokerage (the brokerage that found the buyer).

Hope this helps.

In most cases, the seller pays the commission. The commission is built into the price of sale.