who pays the agents commission the landlord or the tentant?

Asked by New to this, Chicago, IL Mon Jun 24, 2013

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30
Brendan Ross, Agent, Chicago, IL
Fri Jun 28, 2013
Typically the rental agent's commission is paid by the landlord here in Chicago. It is usually in writing in the listing agreement between the agent's broker and the landlord.

If your agent is asking that you pay his commission, you need to ask him why he thinks you should pay. Was there an agreement between the two of you?


Brendan Ross | Real Estate Attorney and REALTOR®

http://www.chicagorelaw.com
1 vote
Evelyn S. Fr…, Agent, Chicago, IL
Wed Jun 26, 2013
What type of agreement do you have with the agent? Did you sign a tenant/broker agreement? What are the terms? If you didn't sign an agreement then you are not required to pay.

Why the serious turn of events?

Too many missing pieces to properly address your concerns.
1 vote
Don Pasek, , Chicago, IL
Mon Jun 24, 2013
Hi, New to this:

I agree with my colleagues that in the Chicago area, landlords usually pay the commission on a residential rental. However, for commercial rentals (storefronts, office space, etc.) the property owner and the lessee each pay their own brokers.

One thing to remember as a tenant: the broker who works for the property owner and shows you an apartment does not represent you and does not have a fiduciary duty to you. This means that the broker will act in the best interests of the property owner, but not necessarily yours.

All leasing Brokers must act fairly with respect to customers, but their primary job is to protect and promote the interests of their client. In Chicago that usually means the property owner.

As a representative of the property owner, the listing Broker will encourage you to make an application to sign a lease. The Broker will promote the specific property you've asked to see and try to convince you that it's a better option than anything else in the neighborhood. Also, you'll only receive information about the property about which you specifically ask, is required by statute, or required by the owner's instruction.

If you really are new to leasing, it would pay for you to hire a Broker of your own to negotiate a lease for you. In Chicago, you typically won't pay for this service, since tenant representatives in residential transactions usually get paid by the owner's broker.

The benefits of having your own representative are many: you'll have someone to ask questions you wouldn't know to ask, you'll have someone who will help you to weigh alternatives, and perhaps most importantly, you have someone who will promote your best interests.

When you hire a leasing rep, ask about experience: how long has the Broker been licensed, how many tenants has the Broker represented? Also, do they charge any fee for their services to you?

Most tenant applicants in the Chicago area will have to pay a small application fee and credit check fee. These can range from $25 to $50 or more per person, depending on the thoroughness of the check (background checks cost more, simple credit report less). These fees are usually non-refundable and separate from any security deposit or rent. Your Broker-representative can help you to prepare your supporting documentation to make the best application possible, given your credit and rental history.

Regards,

Don Pasek, CIPS, TRC, ADPR
Omniterra Real Properties
Chicago
1 vote
What if my landlord is asking me to pay the fee because he let me out of the lease due to a hostile situation in the building? I am moving out on the 15th and was going to pay 1/2 a month of rent. He has rented the place, they will be moving in on the 17th and now is saying that i should be responsible for the brokerage fee (1 month of rent) and carpet cleaning (I caused no damage to the carpet) - it all sounds a bit shady to me.
Flag Fri Oct 30, 2015
Christine.w…, Other Pro, Fort Myers, FL
Thu Dec 22, 2016
Real estate commission is negotiable. And the question of who pays the commission on a rental, the landlord or the tenant, is also determined by local custom.
If a landlord hires a realtor, then he is more likely to pay for the real estate service. If the tenant is represented by its own broker, then tenant needs to pay.
0 votes
UpNest, Agent, San Francisco, CA
Fri Dec 16, 2016
It could really depend. Sometimes the landlord pays it and sometimes the tenant pays. If you're looking for a realtor who doesn't charge a hefty broker fee, I would try search on UpNest.com. You can compare rates in your local area or find a realtor who isn't charging a broker fee due to the down season (winter).
0 votes
Leslie Lee, Home Buyer, Atlanta, GA
Wed Dec 14, 2016
In Chicago the HOA include water n electric etc... Does the landlord charge it to tenant.

How much does the landlord pay to agent monthly to manage the apartment
0 votes
Matt Hoyt, Agent, Highland Park, IL
Mon Oct 21, 2013
My experience in Chicago, its the landlord. One months rent for a one year lease.
0 votes
Jacqueline S…, Agent, Chicago, IL
Mon Oct 21, 2013
In Chicago the landlord usually gives up the 1st month's rent to the listing agent, who then cooperates with other agents if it was in the MLS or other sharing agreement, and pays them.
0 votes
Elena Ravich,…, Agent, New York City, NY
Mon Oct 21, 2013
In Manhattan, when an owner is renting out her own condo or a coop apartment, commission is usually paid by the tenant and shared by cooperating brokers. When it is an open listing by a management company, sometimes they pay one month OPs ("owner pays") and sometimes it is CYOF (collect your own fee from the tenant). When the market is busy and demand is high, the burden of paying the fees is shifted to the tenant, when the market slows down, more management companies and even private owners are willing to pay broker's fees. However, from my experience OPs are paid on larger and high end buildings with high rents.
0 votes
Cindy Wilson, Agent, Chicago, IL
Sun Jun 30, 2013
Did you find a rental that wasn't listed in the MLS and didn't offer a cooperating commission after you'd been working with the rental agent? Without having any specifics, that's my guess. You cannot ask a rental agent to work for you but not be compensated for time and effort. If the landlord is offering a commission, then he/she should compensate your agent. This isn't NY, so the agents expect to be paid by the landlord or rental company. If you've gone to Craig's List or somewhere else on your own while your agent is also locating and showing you apartments, then you need to take care of your agent.
0 votes
Melissa Goss, , Center Moriches, NY
Fri Jun 28, 2013
In NY, the commission is paid by the tenant. Its usually a break down like this - 1 month rent, 1 month security and 1 month brokers fee.

The only time it is ever paid by the landlord is if it is a higher end summer rental.
0 votes
New to this, Renter, Chicago, IL
Tue Jun 25, 2013
the agent is now demanding I pay their commision, what do I do?
0 votes
David Green, Agent, Annapolis, MD
Tue Jun 25, 2013
Commissions should be discussed upfront! You do not need a surprise after the fact. Most state offer a contract to shop with a real estate person that will state who pays what and discuss why. Everyone and everywhere is different.

David Green, Managing Broker
0 votes
Joseph Santi…, Agent, Boca Raton, FL
Tue Jun 25, 2013
This would depend on the customary practice in your State or area. In New York the tenant pays. Here in Boca Raton, Florida the professional fee is the landlords responsibility.

http://www.FloridaMoves.com/Joseph.Santini
http://www.BocaRatonRealEstateBlog.com
0 votes
art, , Chicago, IL
Tue Jun 25, 2013
Hi

Typically, any fees are paid by the landlord, and set in writing on the listing agreement. Also, if you are looking for a rental to lease and need help locating your perfect place, contact me!

Art Jarrett
Real People Realty
773 551 4103
0 votes
Ivan Sagel, Agent, Chicago, IL
Mon Jun 24, 2013
Hello,

Typically, any fees are paid by the landlord, and set in writing on the listing agreement. I have heard that in NYC tenants pay to retain brokerage services.

Best regards,

Ivan Sagel
312.515.7823
ivan@atproperties.com
http://www.atproperties.com/agents/IvanSagel
0 votes
Meir Aloni, Agent, Plantation, FL
Mon Jun 24, 2013
In South FL, landlords pay broker fees; I personally own multiple number of houses for rent
I don't recall hearing, ever, about tenants ever paying broker' fees, in our market...


Did you like this post? If so please click on the "green thumbs up" or the "best answer". Thank YOU!

With enthusiasm,

Meir Aloni & Team

CRS (Certified Residential Specialist)

CDPE (Certified Distressed Property Expert)

RECS (Real Estate Cyberspace Society)

Successfully selling Broward County since 1986!

Direct phone# 954-338-5220 http://www.WeSellBroward.com
0 votes
Helen Mandel, , Chicago, IL
Mon Jun 24, 2013
On residential property landlord usually pays the commission.
0 votes
Gemini Tamon…, Agent, Morton Grove, IL
Mon Jun 24, 2013
The landlord usually pays for it.
0 votes
Matt Laricy, Agent, Chicago, IL
Mon Jun 24, 2013
The landlord typically does. All agents charge different things, so ask a few what they would charge. I typically charge one months rent.
Web Reference:  http://Americorpre.com
0 votes
Santiago Ken…, Agent, Chicago, IL
Mon Jun 24, 2013
The client that hire the agent in the 75% of cases
0 votes
Jason Kaczma…, Agent, Brookline, MA
Mon Jun 24, 2013
Although I am not from the Chicago area, I do have a different take and answer on this question. Fee structures will differ vastly from market to market depending a few different factors. From my experiences a broker's fee can be paid by the landlord, the tenant or the combination of both. This is decided solely on the demand of the property or neighborhood and how the "rental market" is at the time. For example, in the Boston area we are at record low inventory (2.8 -3.1 vacancy rate) and record high rents with $1945.00 to $2050.00 being the median rent for the Boston area. Rental properties in areas that are located in neighborhoods or buildings that have a much higher demand can see rents 2X or 3X that amount. I have yet to have one landlord pay an agent's fee this year. Be sure that you have a reputable agent that is not trying to be paidd on both sides. This practice is called "double dipping" and is frowned upon. In short if the property warrants paying the fee then do so, otherwise I am sure your agent can find you an alternative that will meet or exceed you needs.
0 votes
Joanna Zator…, Agent, Chicago, IL
Mon Jun 24, 2013
The landlord should pay the commission. Please let me know if you have any other questions.
Joanna Zatorska-Moore
Hometown Real Estate
773-599-2662
0 votes
Philip Sencer, Agent, Chicago, IL
Mon Jun 24, 2013
Almost always the landlord, but anything is negotiable.
0 votes
Jacqueline S…, Agent, Chicago, IL
Mon Jun 24, 2013
Landlord, unless you make a separate agreement with the tenant agent, but who would to that.
0 votes
Sohail Salah…, Agent, Chicago, IL
Mon Jun 24, 2013
In Chicago, the landlord pays the commission. I have yet to see the tenant pay.



Sohail A. Salahuddin | Founder and Team Leader

Innovative Property Consultants Group | Sales and Leasing

http://www.innovativepropertyconsultants.com



Jameson Sotheby’s International Realty

425 W. North Ave. | Chicago, IL 60610 


O: 312.335.3230 | C: 312.437.7799 | F: 847.805.6030

"Extraordinary Service For Extraordinary Lives"
0 votes
Timothy Gall…, Agent, Orland Park, IL
Mon Jun 24, 2013
In Chicago it is the landlord but your first months rent check will be written to the agent's company. (Not to the agent himself).
0 votes
Daniel Porter, Agent, Chicago, IL
Mon Jun 24, 2013
Typically in Chicago the listing agent, working for the landlord will have an agreement to get paid by the landlord and share their commission with the broker who brings in the tenant.
0 votes
Bill J Delig…, Agent, Naperville, IL
Mon Jun 24, 2013
It depends, but in the Chicago area the Listing Agent makes an arrangement with the Landlord to pay the commission. From this commission both the Listing Agent and Selling Agent (if there is one) get paid.
0 votes
Thomas Moser, Agent, East Northport, NY
Mon Jun 24, 2013
There are different conventions in different parts of the country. Here in NY, it is the tenant, but I know that in some other parts of the country, the norm is for the landlord to pay it.
0 votes
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