Below is an excerpt from an artcle (one of many) dealing with the Sherman anti-trust laws, and how they pertain to Realtors......the point of the article was that in no way should agents carry on group conversations regarding commissions. It's not my opinion - it's the law. Here is the excerpt:
:"Agents and brokers in any setting, business or social, should take great care to never even discuss commission rates in any context. It's much better to be safe than sorry in this case."
"Never use the word "standard" or "prevailing" or "typical" when describing your fees and services"
When in doubt, I choose to air on the side of caution.
It's your prerogative to post whatever you choose. I wasn't trying to lecture..... just to be hepful.
A simple google search on this can be very enlightening.....but a call to your state Real Estate Commission will certainly clairfy it for you if your Broker can't.
I used to think as you do, when I was new to Trulia, that it was perfectly fine to discuss commissions openly here.....but then I read up on it, and other Realtors on Trulia helped educate me.
As I said.....everyone is free to post whatever they choose to...but since this is a public forum, I prefer to use caution. I just wanted to share this information with those who weren't aware of it. What anyone does with that information is certainly up to them
This discussion has taken place on many other threads here on trulia, so it' s not a new topic..
Our MLS shows 11471 active or active contingent listings. Starting at 1% and going up to 5% are the payout amounts to the buyers agent. Usually these fees are split evenly, so for example the 3% commission means that the seller is paying the listing agent 6% and the LA is offering half of that to another agent to bring a buying. Using that assumption, double these payout amounts to get the broker fee. But, not every agent offers an even split. For example, the 8 guys offering only 1% are probably getting paid more than 2%, but they will also never get a buyers agent to show their listing either. So, the number of listings at each incremental payout amount are as follows:
2%....... 101 listings
These numbers may not all add up to the total of listings, but you get the idea. I also do not have an average for you, but you can do that math. I hope this helps.
Real estate professionals *must* avoid the use of words such as "typical", "average", "usual" and never discuss commissions in all public circumstances, especially in public forums such as this.
Commissions are always negotiable.
The Keys to Charleston
You're right, discussions between competitive agents/brokers concerning commissions should be avoided, as they could be construed as "price-fixing". However, in a general sense, when questions are asked, even in an open forum, I feel it is perfectly OK to state what you charge. We often openly discuss our company commission policy in sales meetings with 50-60 agents present, since all agents work under one BIC. It's a fine line to walk.
You are right, as I stated, that commissions are always negotiable between a broker and a seller, but I differ with you in your opinion that Foster Smith's response was the only correct one. It is in no way "price fixing" to mention what your commission is and how you justify charging that percentage. Sellers have a right to know & I am not ashamed of what my commission is. Brokers have the right to accept any percentage or fee that they choose to accept. In the end, what an agent does for the commission they charge is what is important.
Agents should refrain from discussing specific commissions as it can be seen as price fixing, and is against the anti-trust laws. For those who question this - check with your Brokers or your board of realtors!
Careful all...this is a very public forum!
It is also my feeling that commissions above 3% do little to incent an agent to show a property.
What kind of an agent would not show a property that would be a good fit for their client because of % commission? An unscrupulous one. Are Real Estate Agents as a whole, unscrupulous? I don't think they are.
As you can see, real estate commissions in South Carolina are negotiable. I believe what Dan was trying to demonstrate is that while you may be able to find an agent who will list your house for less than the popular 6% fee, it's important to consider how your listing might be at a disadvantage if buyer's agents see they'll have to accept lower compensation for selling your house than another house.
In this economy everyone is looking to save money - I completely understand what you're after - however, with home prices continuing to slip, saving money right now means selling as quickly as you can. Saving 1% of the sales price by listing with someone offering to charge you less can very easily end with you losing much more than 1% if the home sits on the market with no offers. Before too long you're making price reductions, and a 1% drop isn't going to make much of a difference to a buyer in most cases.
Carolina One Real Estate
What is it that you would like to list? Call me anytime for advice, answers, or to get your property SOLD.