Are there many agents that will list a house for less than 6% commision?

Asked by Jill Carey, Lubbock, TX Tue Jul 13, 2010

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12
Keith Sorem, Agent, Glendale, CA
Tue Jul 13, 2010
Jill
There is no set commission rate, legally there cannot be one.

In the real world, both list price and commission are marketing tools. If your goal is to sell your home for the best price, meaning net profit to you, then I would focus your efforts on maximizing that number.

You do no sell homes for a living, so you'll have to ask professionals that do.

Here are some facts that will help you ask the right questions:

Homes that sell in the first 30 days sell closest to asking price. In any given market that means that about 20-30% listings sell within 30 days, the rest (70-80%) sell in two, three, four, five months.
In my MLS, homes that sell within 30 days are selling at 99.9% of asking price. at over 120 days they are selling for 93% of asking price. That is a 6% difference.

New listings are expected to have 10-12 showings or one offer in the first two weeks, otherwise we lower the price, usually around 5%. No showings...price is too high. Showings and no offers, price is too high.

How does this relate to commission? You want to sell for the most money. If 70-80% of listings are overpriced, what are the chances that the Realtor you like...offers you the highest price and lowest commission..is right?

Truthfully you need a Realtor that will tell you the truth up front. My newest listing has six offers, most above asking. It's been on the market for five days. My next listing had a full price offer in the first week on the market, will sell at full asking price.

The fact is that if a Realtor's ONLY tool is to offer you a discounted commission, then I would probe deeper. You are paying a professional to:
1. Analyze your home and advise you what you need to do to get top dollar.
2. Figure out what features in your home will attract the most buyers and market those features.
3. Price your home so the other Realtors, who 90% of the time represent the buyer, will say "wow, this is a great deal, let's go and look at this property" so you can get multiple offers
4. Be an effective negotiator, counter back and forth, start a bidding war, and get the most for your home.

Good luck.
2 votes
Joe Luca, Agent, North Providence, RI
Tue Jul 13, 2010
As previously noted commission rates are negotiable up to a point. Some factors you need to consider are: where is the market in your community? (ie; are there more buyers than sellers or vice versa;) how anxious you are to sell your property? (a higher commission rate will motivate both Listing and Selling Agents;) does your property have any marketability "challenges"? (ie: is it a tough sell due to location, cosmetic/structural condition, or other property-specific issues.)

Generally, you should try to find a Broker/Agent who you are comfortable with, has good references, a strong "digital footprint", and the resources to market your property. Don't lose sight of your goal; to sell your property for the maximum amount the market will bear in the shortest time. If you save 1% on the commission and it takes longer to sell your property, the real estate market could turn for the worse or interest rates could increase - thereby reducing the number of qualified potential buyers.

Don't be penny-wise and pound foolish.
1 vote
Wain Berry, , Fort Lauderdale, FL
Tue Jul 13, 2010
First all commissions are negotiable however in south florida 6% seems to be the most popular rate.
Sometimes when the agent has both sides of the deal he will lower his rate to 5% but is not required to
do so unless specified in the listing agreement.

-Wain Berry
David Wain Realty
1 vote
Frustrated, Home Seller, Lunenburg, MA
Tue Jul 13, 2010
5% is the average...6%doesn't get the job done any better than 5.
1 vote
fsecola, Home Buyer, Lubbock, TX
Sat Jan 4, 2014
There are many agents that are willing to negotiate and there are also websites that specialize in matching home sellers with these agents. Take a look at http://www.agentbidding.com
0 votes
Phil, Home Seller, Lubbock, TX
Sat Jun 23, 2012
Jill,
The short answer is "yes." Most agents will cut their commision if it will get your business. Just remember that the real estate market is no different than any other market. You get what you pay for. A larger commision is just more motivation for an agent to get you property sold.
0 votes
Angie Willia…, Agent, Lufkin, TX
Sun Dec 12, 2010
Jill, brokers/agents do not have a set commission rate, however alot of them do tend to charge 6%. When you looking to list your home think about a few things. Right now home selling is a very competitive process. Think about this, if there are two homes in the same price range, same condition and similar areas,one has a 4% commission and one has a 6%; which one do you think the agent is going to try and show first? I am not saying this is necessarily right on the part of the agent, but it does happen. Another thing you need to consider agents typically pay for their own advertising and any promoting of individual properties from their commission, if you cut their commission how can they effectively market your property?
I dont know what you do for a living, but would you cut your rate if I asked you to? If your boss came to you and said, this project is easier than what you did last week so I am going to pay you 30% less this week, what would you do?
0 votes
Christine Mc…, Agent, Valparaiso, IN
Thu Nov 11, 2010
Hi Jill,

I'm sure it's different in all states and even local areas. One thing that is constant is that the commission is negotiable. I know agents that provide different services scaled to the commission.
I would also advise you to look up the agents you have narrowed your search down to. See what their listings look like. How are the pictures? Can you find their homes on the internet? Do they have a video of the home, text messaging or voice signage? Is there a flyer box in front of the home?
Ask what you get for the commission. It may be worth the extra 1%.
0 votes
Mary Benton, Agent, Lubbock, TX
Thu Nov 11, 2010
Each Realtor sets their own commission. While I usually charge 6%, if a client is in a distressed situation with home value I try to adjust my rate. A great deal of work and time goes into listing, measuring, photographing, marketing, showing, negotiating and managing the process from contract to close. The 6% is split 50/50 with a Realtor bringing a buyer. Of the 3% I retain, my broker keeps a share, I pay for marketing of the home, and then take my pay. Be sure to look at your net...making more money on the sale of your home. And not just the commission percentage. See Keith's answer...he is right on. Thanks for asking and let me know if I can be of assistance.
0 votes
Kalah Sprabe…, , Lubbock, TX
Wed Nov 10, 2010
Jill,
My name is Kalah Sprabeary and I'm with Rush Realtors here is Lubbock. We list homes for 4% total commission. Commission is not a set number, so we choose to save our sellers money by only doing 4%. We also do not have any up front costs and all of our services as well and advertising are all included in the commission rate. If you would like to know more about listing your home with us, as well as a complimentary market evaluation and home evaluation please feel free to call me at 806-470-6572 or email Kalah.vision@att.net. I'd love to help you!
Web Reference:  http://www.rushrealtors.com
0 votes
Voices Member, , Benton County, OR
Tue Jul 13, 2010
Jill

From the Dept. of Justice...

"Brokers typically charge a commission based on a percentage of the home’s sale price. Over the past decade the average commission rate has remained relatively steady between 5.0 and 5.5 percent."
http://www.justice.gov/atr/public/real_estate/save.htm

A lot of good and current info on the DOJ site regarding Commissions and other Options, please give it a look...http://www.justice.gov/atr/public/real_estate/index.htm
0 votes
Anna M Brocco, Agent, Williston Park, NY
Tue Jul 13, 2010
Keep in mind that commission is always negotiable between you and your agent, there are no set standards--interview a few different agents, and choose the one you like best and the one who has the most to offer in order to get the job done.
0 votes
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