Rental Basics in New York>Question Details

William Bost…, Other/Just Looking in New York

Rentals in NYC and commissions

Asked by William Boston, New York Fri Jan 18, 2013

In the case where you have an agent listing an apartment for rent in New York and a different agent representing the tenant, who determines the commission paid to each agents? The agent representing the landlord or the agent representing the tenant? How does it work?

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The listing agent determines the commission rate. This agent is representing the landlord or owner of the apartment in the case of a co op or condo rental.
1 vote Thank Flag Link Tue Jan 22, 2013
Percentage of the broker fee is determined by the landlord when hiring a listing broker; the split between the listing agent and the tenant's agent is determined by the REBNY Universal Co-Brokerage agreement, which calls for a 50/50 split between 2 agents.
0 votes Thank Flag Link Fri Jan 18, 2013
REBNY rquires all it's member agents/brokers do an even split on all co-broke deals, full stop.
0 votes Thank Flag Link Fri Jan 18, 2013
Quick clarification, the landlord (property owner), not the Broker, makes the decisions. The Broker simply represents their client's interests. In markets where there is a very low volume of vacancies, it is more likely that the tenant will have to shoulder more burden for the commission, sometimes paying the entire commission that is split between the broker representing them and the broker representing the owner.

Sometimes the owner will be willing to pay a portion or all of the commission. There are many variables, but the full commission rarely exceeds 15%. If your offer is sufficient to warrant doing so, you may be able to negotiate the portion you pick up vs. the portion the owner pays.
0 votes Thank Flag Link Fri Jan 18, 2013
There is a standard in the Manhattan marketplace unlike other areas of NY.
The standard is 15% of the years rental. This 15% is split between the 2 brokers.

All the best,
Elizabeth Caruso
Realtor, CBR, SFR
917-662-1846
0 votes Thank Flag Link Fri Jan 18, 2013
Hi William,

Real Estate firms that belong to REBNY(the Real Estate Board of New York) are required, by rule, to share (co-broke) their EXCLUSIVE listings with other REBNY firms.

There is usually have a 50/50 split of the commission, regardless of the commission amount, between the landlord's representative and the tenant's representative. Representation does not follow the compensation.

This is why New York State requires all brokers/sales agents to present their customer with a Disclosure Form. This is to clarify the nature of their agency relationship, and to make sure that the tenant or landlord knows for whom the agent is working, as well as the rights and obligation this agency creates. You can see a Disclosure form by clicking on the link below.

The landlord's representative, who is the one holding the exclusive listing will have the decision making power when it comes to determine a potential commission discount, as the tenant is the one "making an offer" on a listed unit.

http://www.dos.ny.gov/forms/licensing/1735-a.pdf
0 votes Thank Flag Link Fri Jan 18, 2013
If you have an agent listing an apartment as a exclusive agent, then he is the one who determines the commission and usually is 15% 50/50 commission split. that is a co-broke between two agents. When you are representing the tenant and have and other agent representing the landlord, you should ask the exclusive agent about the commission and commission split, before you show the apartment to your client.
0 votes Thank Flag Link Fri Jan 18, 2013
If it is an exclusive listing of the agent representing the landlord, and another agent is representing the tenant, the two agents will split the 15% commission (15% of the yearly rent) 50/50. This is usually the case.

There are some scenarios where the exclusive listing agent may reduce their portion of the commission in order to incentivize other agents to come show the apartment.

And sometimes the listing agent may be paid by the landlord, allowing the agent representing the tenant to collect their own fee from the tenant.
0 votes Thank Flag Link Fri Jan 18, 2013
Hi William
Standard commission for a rental in the city that is paid by the tenant (in most cases and todays market) is 15%
When 2 agents are involved it is basically split in the middle
0 votes Thank Flag Link Fri Jan 18, 2013
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