By the way, discussing commission â€“ including what you want to be paid â€“ is not against the law. Not even in a public forum such as Trulia.com. We have not given up the right of free speech.
What is against anti-trust law is for agents to agree as a group as to what the commission should be. That is price fixing and it is illegal.
So yes, there are average commission rates, close to 6%, but that can really vary depending on the location and price of the home you're wanting to sell. Many agents are willing to be flexible on commission rates, but it's not something they like to advertise. And most clients are not very capable or comfortable negotiating rates.
At UpNest (http://www.upnest.com), we created an online marketplace where home sellers can confidentially submit their homes, and multiple top local agents will compete to obtain your listing. Some agents lower their commission rates to stand out, and every agent that submits a proposal is an experienced agent, so it's not the same as working with a low grade discount brokerage.
Hope that helps!
That said, I also see listings by full commission brokers that are initially well above the market (having sold the seller on unrealistic expectations to get the listing), only to have to drop the price multiple times.
One problem with FSBO's is that the majority of buyers use a buyer's agent who won't show them homes that don't pay a full commission, so the seller doesn't get much traffic.
The notion that sellers pay the commission is a myth. The commission comes out of the price the buyer pays.
There is no 'average commission' rate in Denver. This is something to discuss individually with each of the agents you choose to interview. What is more important is what each one will do for you for your agreed upon commission. What you don't want is an 'average' agent working with you with what could be one of the biggest transactions you will do in your lifetime. Find an outstanding Realtor to assist you with this important matter. Best of success with your endeavors.
Robert McGuire ASR
Your Castle Real Estate
Direct - 303-669-1246
Real Estate Professionals answer to very strict rules and guidelines that do not allow this kind of discussion in a public venue. I have been in the real estate arena for a long time and would be happy to meet for coffee to discuss how to market your home effectively, research a new purchase and answer any other inquires you may have.
Looking forward to hearing from you.
HomeSmart Realty Group
Sorry I can't be more specific, but I believe that the why's are discussed pretty adequately below.
Your Castle Real Estate
The the Denver Metro market, many (most) homes sell within a matter or hours or days. Realtor fees are typically split 3.2% to the seller's agent, 2.8% to the buyer's agent. I can tell you with certainty, the buyer's agent DESERVES the 2.8% -- it is so difficult to find a property, especially between $200-$300K in this market that most have multiple offers within hours.
I tried a "Flat Fee" Commission program in Denver in 2014, and my former company, RE/MAX would not allow me to do it, so I left. I've been thinking about re-starting a new campaign with a variable flat fee rate again this year. I think a flat rate is fair ... period.
Cherry Creek Properties, LLC
Commission is negotiated between Seller and Agent and while there may be an average, there is no fixed 'standard'. That is what is not allowed under our license. When you negotiate with your listing agent, you will come to an agreement about the percentage of commission to be paid. The listing agent generally shares 2.8% of the sales price with the Buyers' agent, takes the balance and gives whatever split they may have (not all do) with their employing broker, subtracts marketing costs for your property (because we pay for that whether you sell you home or pull it from the market) and keeps the remainder.
It's a great question and you'll get many answers from many agents and as you can see, a few gripes from people who don't value the profession and most likely don't tip their waiters.
Personally, I've never let the commission discussion break a deal. We either find a number we are both comfortable with or we move on. Life's not about the b.s.
However, Robert, That is not the case.. You know as well as I do that the MLS (Metrolist) charges us all a flat rate for as many listings as we have into their system. With IDX designation, all of our listings are automatically uploaded to Realtor.com, Realtor.com, and 100's of other sites as well as your own personal website for the public to view...all for the same flate MLS fee. Signs, lockboxes and brochures, which I do in color and on photo paper for both inside and outside, are all expected and provided to anyone listing their home with me. We all use the same real estate commission approved contracts and most of all use electronic contracts.. too make our jobs even easier.
Not sure I agree with you regarding losing money on $995 as you are not considering that I stated that amount was if someone was also buying a home. You are also not taking into consideration being able to sell my own listing. I do see your thought process as this is the perception most agents give the public becase they don't have all the information
Robert be careful using the term "representing" becasue you know as well as I do, that we are not attorneys. We are too look out for the sellers best interest and follow ethics as Realtors.
As I stated below in a previous answer below, 'you get what you pay for'. If a 'Realtor' marketed your home correctly with the proper advertising, flyers, Realtor.com, Open Houses, signs in place, lockboxes, etc.; he would lose money at $995.00 and quickly be out of business. The discount brokers will come to your home with a menu of items that add up to the same commissions as a professional broker.
Most discount brokers offer this 'bait and switch' approach because they can't compete with the rest of us who are doing business the right way and have all available resources and marketing materials available and charge enough to 'represent' you fully and look out for your best interests. Look over the discount broker's paperwork if you must and then interview a couple of other reputable local Realtors before making a decision. You also don't want to buy a 'cheap' parachute or have surgery with a doctor who will do the surgery for a 1/4 of the normal rate or less.
Your Castle Realestate
Julie states that the 2.8% co-op is not negotiable???? Is that not price fixing??? In this current market with homes basically selling overnight, why are you as a seller not able to negotiate the CO-OP??
Michael if I can assist you in anyway, please let me know. I have been saving my clients thousands for over 20 years!
Broker / Owner
Metro Broker Total Realty
Here's some good advice: when selecting someone to represent your best interests in what's likely to be the largest investment you'll ever make, don't cut corners. The reality, is real estate is one of the only professions in the world where literally anyone can get a license. No education, experience required. Just take a six-week course that teaches you "how" to pass the real estate exam, and they turn these people loose on the public (who, of course, assumes we're all the same). That's like saying all doctors are the same or all attorneys are the same ... you always get what you pay for in any industry.
Good Realtors with years of experience, knowledge and talent, like any other profession, are worth they're weight in gold (literally). Julie Montgomery, Elite Denver Homes, http://www.jmontgomery.com
From my almost 39 years in the real estate business, the most prevalent 'Average' selling
commission rate has been 6%. Of course there are 'discount' brokers who will work for less;
the caveat is "...you get what you pay for..." In any market, you want a broker who is honest,
one who has integrity, a broker with a good reputation who can also provide references. It
will pay dividends for you to shop for the best service and then see if you can negotiate a
fee for their service. On occasion, we have agreed to reduce our fee if we are also helping
a Seller buy a replacement property where we get paid 2 commissions.
Broker, CRS, ABR, NCE, SEC
stimson KENNEDY Realtors
Cell: 303 478.9494
Bill Pearson GRI, SRES |"Your Denver Realtor For Life"
ERA Herman Group Real Estate| 201 Columbine Street| Suite 301| Denver CO 80206
5280 Magazine FIVE STAR Real Estate Professional â€“ 2010, 2011, 2012
It varies from agent to agent and company to company. It can also depend on your situation. For example, if you are planning on selling and buying using the same Realtor, you might be able to negotiate a reduced commission. For some reason this topic is always such a taboo to discuss, but I think buyers and sellers in Colorado should be more aware on how we get paid, so I dedicated a blog post to this. http://www.trulia.com/blog/marina_jensen/2012/07/how_realtor
I hope you find it helpful!
Realtor with Cherry Creek Properties
You should find agents that work in your area regularly and ask them individually what their fees are, and what service they provide for those fees.