Home Selling in 90068>Question Details

PoliEcon, Both Buyer and Seller in 90068

Are broker/agent rates negotiable?

Asked by PoliEcon, 90068 Thu Feb 23, 2012

How do I determine the market rate for a listing agent/broker in my neighborhood? What is the best way to negotiate the rate? I want a motivated agent but I don't want to overpay a commission on a $2MM sale.

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23
Dorene Slavitz’s answer
Dear PoliEcon,
Yes, commission rates are negotiable ! Commission rates can vary from 10% down. The best way to talk about commission rates is just to be straight forward with the agent about that issue. I would caution you that high end property does require additional marketing, however, you may want to pay for the additional marketing yourself in order to keep commission rates low. Also, you do want to offer the agent who brings in the Qualified buyer additional commission. Most homes are sold by agents with buyers.

Good Luck to you!
0 votes Thank Flag Link Thu May 17, 2012
BEST ANSWER
Rates are negotiable though more important than the rate is the service and marketing they provide.

Experience counts, look for an agent who has been working full time at least 5 years, more is better. Ask for documented evidence of how many transactions they closed in the past year (any less than 12 a year and you're probably wasting your time) Ask for a list of the current listings and then start doing your diligence, check Trulia, Realtor.com, Zillow etc and see how their presenting their listings. Do they use a professional photographer to shoot homes, are they appearing in a dominant position all over the web etc. Finally ask what their position is on dual agency (one agent in the middle working both sides of the transaction)

I've posted a link to a piece I wrote and posted on my blog here on Trulia that offers more advice on this subject.

I wish you the best of luck and that your home sells quickly.
1 vote Thank Flag Link Sat Apr 14, 2012
Beeing an owner of my own Real Estate Company offers me a great flexability on the commission - I will be able to offer you the best deal in town!


Please call me anytime - 424-777-9377


Should you have any questions - please feel free to call me Toll Free: 1-855-TRUST-55 (1-855-878-7855) ext. 777.



Sergey Fednov

President - Realtor®
- Trust Sale Realty -

Residential & Commercial Real Estate
_______________________________
Toll Free: 1-855-TRUST-55
Toll Free: 1-855-878-7855
Phone: 424-777-9377
Fax: 310-356-4925
http://www.TrustSale.com
http://www.TrustSaleRealty.com
Lic# 01896869
11 votes Thank Flag Link Fri Apr 6, 2012
Good to know! i might gonna have to sell my house in the future.
Flag Fri Apr 6, 2012
You can only "overpay" when you pay more than is standard for something, and is really worth less than what you paid, right?

This thinking of real estate sales as a commodity usually leads to lower net for the seller.
You see - not all agents are the same.

I recently had a conversation on the commissions, with the seller who assumed that he would "save" money by offering less in commissions. His opinion changed quickly when we went over the direct relation between Days on the Market (DOM) and sold to asking price ratios for houses with lower than standard commission percentage. The lower commissions houses were not shown as much, and their DOMs were longer and sold to asking ratios were lower as well (stale listings sell at lower prices). This is public information, by the way. We also looked at how different properties were "presented" or "not presented" in the MLS and internet - and looked at their commissions offered and their DOM, sold to asking price ratios...Those that were marketed better - sold at much higher price than those that were not - no surprise there.

There is a lot of work and investment by a realtor when selling any type of real estate - and luxury real estate especially. Agents don't get paid if they don't sell, regardless of how much time, effort, marketing dollars they pour into showcasing property.

For the seller I spoke with (above), I bought furniture and decorative pieces for staging, cleaned the place up, de-cluttered, donated his unwanted furniture, and advertised extensively on the internet etc.) The place sold higher than the market value and higher than what the seller was hoping to sell for, within 21 days. The seller paid full 6% commissions, and his 1% difference (between 5 and 6%) paid off five-fold. He was also very happy...

I feel that the real question here is: "How do I make the most money on my sale?" or, "What should I do to maximize my net on the sale of my property?"

If you find an agent that will make your investment in commissions (read marketing) well worth it,
standard compensation will be well deserved then, and your return (along with your net) will be gratifyingly massive.

Best of luck with your sale, and hope this helps,

Irina Karan
Beachfront Realty, Inc.
IrinaKaran@gmail.com
1 vote Thank Flag Link Sat May 5, 2012
Yes they are negotiable. You want a commission that is fair for all parties involved.
0 votes Thank Flag Link Wed Feb 11, 2015
Commissions are negotiable with most companies. Most important is what you get for what you pay.Discount brokers can mean discount services which can hurt your sale. For clarification no agent should be posting any commission rate in an online forum such as this. it is against the federal anti trust laws and there are LARGE fines for violating these laws. For the agents posting commission rates or averages, they have broken the law and should seek advice from their broker or lawyer.
0 votes Thank Flag Link Sat Aug 30, 2014
You do get what you pay for. A agent who is not going to fight for his own money will most likely not fight for someone else's.
0 votes Thank Flag Link Fri Aug 29, 2014
Rate are certainly negotiable, BUT be careful any agent who can not negotiate his/her commission without selling themselves too short, may not be the best choice for you.


Kawain Payne, Realtor/Notary
0 votes Thank Flag Link Thu Mar 27, 2014
Yes, rates are always negotiable. But there is a balance that should be reached between too low and just right. Use the rate as a test of your potential agents' ability to negotiate (a much undervalued requirement for a high-end realtor). Ask the agent if there is play in their commission rate and see how well they negotiate with you. If they won’t stand up for a fair rate, how strong will they be negotiating the sale price of your home?

Mack MacReady
mack@kw.com
0 votes Thank Flag Link Mon Nov 11, 2013
Okay, you've gotten the same answer many times, but a solid explanation behind "you get what you pay for"...the agents that are effective and sell a lot of houses (the ones you want) are not usually the hungry, cut-rate agents that you're looking for to get a low commission rate. Buyer beware...
0 votes Thank Flag Link Wed May 16, 2012
Broker/agent rates are negotiable and some believe you get what you pay for. You want the best agent for the job sometimes the commission is discounted as well as the service provided.
0 votes Thank Flag Link Wed May 16, 2012
You bet, commissions are negotiable but care should be taken to not "get what you pay for." As always, we would strongly recommend requiring a written marketing plan that outlines in detail the agent and their company's commitment to you.

Consider beginning your shopping by becoming informed about the top area agents and companies in your location and then begin the interview process. Knowing what to ask can bring you the clarity you require. Total volume sale for both the company and agent, market share, internet visibility, services provided, ease with which to contact the company's call center, etc.

Hope this information is helpful.

Good luck,

Bill
0 votes Thank Flag Link Sat Apr 14, 2012
Broker of Record sets a model business plan. If their is "no" flexibility I would assume alot of Listings would be lost!
0 votes Thank Flag Link Sat Apr 14, 2012
Real Estate Broker commission is negotiable in every situation.
0 votes Thank Flag Link Sat Apr 14, 2012
OK SERGEY, we're all owners of our own businesses. Therefore we can offer just about any deal we want. We can even give away our commissions. But what is the quality of service we provide?
0 votes Thank Flag Link Fri Apr 6, 2012
Good point John! Trust Sale Realty is a Full Service Real Estate Company.
Flag Tue Apr 10, 2012
The sky is the limit as to what you can negotiate with an agent/broker. But bear in mind you get what you pay for and in the overall scheme of things the commission is the most insignificant part of the overall deal and worth every penny you pay if you get what you want.

But thanks for asking. We're dealing with an issue now where a client wanted to demand that an agent lower their fee right in the middle of a deal just to get the asking price lowered within their budget. This approach will certainly make your agent's skin crawl and send you packing.
0 votes Thank Flag Link Fri Feb 24, 2012
Hello PoliEcon,
I can do 1.5% as the listing agent and 2.5% for the buyers agent, and if your looking for another property as well I can represent you at 2.5% as your buyers agent with the listing at 1% instead. Goodluck! Definitely find an agent that best fits all your needs!
Socorro Lopo
(626) 827-6280
Evergreen Realty
0 votes Thank Flag Link Thu Feb 23, 2012
Hello,
Commission is always negotiable. Please feel free to contact me if you'd like to discuss different possibilities you are interested in when looking for an agent.
0 votes Thank Flag Link Thu Feb 23, 2012
Commission is always negotiable between you and your agent, there are no set standards; therefore interview in person a few local agents from different realty companies, then choose the one you like best and who has the most to offer. Choose your agent with care, and not by commission alone.
0 votes Thank Flag Link Thu Feb 23, 2012
commission rates are deffinately negotiable, Your best bet is to talk to a couple of different agents in your area and ask what their rate is. This also gives you an opportunity to see who you feel comfortable with since you will be working together you need to make sure you trust and feel good with who you are dealing with
0 votes Thank Flag Link Thu Feb 23, 2012
Hi PoliEcon,

Commission rates for brokers/agents are negotiable - some brokers may also charge a minimum commission rate which the agent is not able to lower further. Customarily, the average commission rates charged to sellers in the LA area is between 5 - 6%, and half of that amount is usually offered to any agent who brings and represents a buyer who purchases the property. For a property in that price range, you should have no trouble finding a motivated agent, even for a commission on the low end of the scale. Good luck, hope this information is helpful.

John Barry, Realtor
DRE #01856079
Coldwell Banker Residential Brokerage
Cell: 323-810-7976
Email: john.barry@coldwellbanker.com
Facebook: http://www.facebook.com/RealtorJB
Twitter: @RealtorJB
0 votes Thank Flag Link Thu Feb 23, 2012
PoliEcon,

Commission rates are certainly negotiable but you need to remember that you get what you pay for sometimes. The best approach is to interview 2 or 3 different agents who work locally in your area. They'll present you with their marketing plan for your home and go over pricing with you as well as discuss the local market with you. Many agents will offer a discount on the listing commission if you work with them to purchase your next home. Here in the Chicago area, listing commissions are around 5% but I know that other areas differ.
0 votes Thank Flag Link Thu Feb 23, 2012
All commissions are negotiable. The way to deterimine what an agent expects to be paid is to simply ask. Many agents will accept a lower commission on a higher priced property than they might on a lower priced property. Their job will be to sell your home for as much as possible as quickly as possible, regardless of what they will get paid to do so. I would be happy to discuss the particulars of you situation with you.

Jenny Durling
Broker Associate
213-215-4758
0 votes Thank Flag Link Thu Feb 23, 2012
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