We’re often asked if real estate commission is negotiable? The answer is yes, in fact if an agent tells you no then question them why not. The agent and or the brokerage the agent is employed under may have a policy to not negotiate off a certain amount which may be what they charge. Additionally an agent that doesn’t negotiate off their commissions might be offering more than other agents so ask whats included in their price.
Traditionally sellers will more often try to save on commissions when the market is either slow or normal. When the market is hot usually sellers just want to get their home on the market asap and sold in the shortest amount of time. In times like these there may not be much time to haggle with an agent over a point or two in commissions. Providing that an agent is or will be charging the seller a reasonable amount like 6.0% then the seller is normally fine with that and lists the home. In a seller’s market, marketing and advertising don’t play a huge role as properties sell almost as soon as their listed so the variance of agent marketing strategies and experience doesn’t become a large factor.
Real Estate Commission is Negotiable… Always!
From an agents point of view when a seller asks to discount the agents commissions, the seller is essentially saying I want a better deal but I don’t want to discount the service and marketing the agent normally provides in any way. Some discount brokers that charge less than the normal 6.0% also discount their service so be careful employing a discount broker or agent. Another point to consider with a discount broker is that many times their clients are handled like cattle because the agent has more business than they can handle. If you’re wanting great customer service and a full marketing strategy definitely go with a full service agent, the full service agent will likely charge you a full service price but you’ll probably be much happier in the end.
Depending on the property, real estate market conditions and how the seller wants to structure the sale, an agent will probably deal with you on commissions. Most of the time in residential real estate the deal is pretty straightforward and so as long as the property isn’t funky and the real estate market isn’t in the dumps then you might try to save yourself a couple bucks. One item to consider is the condition your home is in, for instance a property that is turn-key and pristine will require much less interaction from your agent to other agents but a property in disrepair and deferred maintenance will likely require your agent to be more involved answering numerous calls from other agents about financing terms, things wrong with the property, sellers motivation, etc.
When you list your home for sale and agree to pay a commission to your agent, your agent will probably have to split that commission with another cooperating agent. A cooperating agent is an agent that assists with the deal by bringing in their own buyer client. When a 6.0% commission is agreed upon and your listing agent has another agent on the other side then the commissions will be paid out usually 50/50 which is 3.0% to the listing agent and 3.0% to the buyers agent.