I understand your concern. It is a normal clause in the contract that should you sell the home to the tenant, that the REALTOR would be due a commission. Why? It is known as "procuring cause", which means the person is buying the home as a result of the marketing and listing of that home through that agent. In other words without that agent not only would you not have rented to the people, but they wouldn't have ever seen the home and ultimately end up buying it. 6% is high; however, if you arleady signed for 6%, then you'd be obligated to that fee. I put 3% for my rental listings who later end up in a purchase. You can try to negotiate it down to that figure since 6% is normally split between buyer and seller side. In this case your agent would be representing you still in the purchase and 3% should be more than enough. Try to talk with him or her and ask for an addendum changing it from 6% to the new figure you both agree upon.
Keller Williams Realty Centre
Everything is negotiable, but your rental listing agreement should have spelled all this out upfront.
Yes, it is standard to put a commission payment in if the property is sold to the tenant in our area as well.
There is no "standard percentage" as that would be price-fixing and is illegal.
Since the rental agreement was exclusive, it doesn't matter where the lead came from or even if it was your best buddy. The agent and the broker still marketed your property and they have office expenses to pay.
What is "heavylifting" anyway? So, if an agent works for a year to rent or sell your home, do they get more percentage in commission for their time and effort than if they sold it in a week? The answer is No, but yet you want to judge how much effort and work they do in "showing the property" and "paperwork."
The 6% is only paid on the price you agree to sell it at. What do you care if you get the Net price you want for the home after closing costs, loans, commissions, etc. are paid?
Of course, you could do it all yourself from the rental to the sale. Just get your real estate license and pay your office dues, local mls dues, state dues. Then you need to take some contract law classes since they don't teach you that in real estate school. Plus you probably need to run the contracts by your broker and make some contacts with a title company or attorney to assist with the closing, And..., well you get the idea.
Of course there's no "heavylifting" so you should be just fine on your own.
Based on your collective comments, I discussed the commission with my realtor and negotiate it to lower acceptable amount. I was not opposed to paying the commission - I just didn't think it was fair to have 6%. It was also good to understand the "procuring cause" reasoning.
Thanks again for all your prompt responses.
Check your original listing agreement with the brokerage to find out if it is in there, and if it is not, you may want to call your agent and the broker to figure out how to proceed.
Keller Williams Excellence Realty
Talk to your realtor, try to negotiate the fee and if you need to go to the broker as well.
As I see below, you received good advice. Yes, this is pretty typical, but the fee is negotiable. It sounds like you worked out a more favorable commission, which is probably the right thing to do since the agent wouldn't have to do the full marketing of the home in the future if you and the tenant would work on selling/purchasing the home.
Thanks and good luck.