What’s a Fair Realtor Listing Fee?

Even though the world of real estate has greatly changed since the emergence of only realty and home listing websites, there are still many real estate agents who are actively giving their services to those who are looking to sell their homes. While it may sound easier to have a real estate agent take care of everything regarding the listing and showing of your home, the reason that many people are trying to avoid them is that most real estate agents charge a listing fee for listing your home for sale. That fee usually averages around 6% and if you consider the fact that listing a house is something that you can often do on your own it may seem like 6% is a high amount to spend on listing your home. 

Do realtors avoid flat fee listings?

There is often the question asked of whether buyer real estate agents may choose to not show a certain house to a prospective buyer because the house was flat fee listing, and quite frankly in most cases that is a myth and not something that occurs. The buyer’s real estate agent only cares about one thing and that is pleasing their customer and showing them any house that may appeal to them and fit the bill of what they are looking to buy. What’s more, even if the listing was added on a flat fee, the buyer’s real estate agent’s commission does not change, therefore they have no reason to not show their prospective home buyers any listings that fit their wants. 

What is a realtor’s commission?

The commission the real estate agent receives will depend on which side of the transaction they are employed by. A seller’s real estate agent will usually receive a higher commission as they have to prepare the home listing and plan open house events to show off the property. This means that generally, the fees that they require are higher. Oftentimes, many sellers may choose to avoid having to pay the seller’s real estate commission by putting the house on the market on their own. This in most cases will save them a good amount of money since they won’t need to pay a high commission to their real estate agent. 

A buyer’s real estate agent, that is the real estate agent employed by those looking for a home will also receive a commission for their service. While the buyer’s real estate agent receives a commission, they are not the ones responsible for the listing of the house, drawing up closing documents, or advertising that the home is for sale. All of those tasks are the seller’s real estate agent tasks and as such, they are not something that the buyer’s real estate agent will have to worry about. 

The way that this real estate commission is paid, is through the seller. That is the seller may be paying a 6% commission to their real estate agent for the sale of their home and then their real estate agent will usually split that commission between them. The split is typically 50/50 but there are occasions in which the commission rate is not split evenly between the two parties. 

What percentage do most realtors charge?

The average percentage charged by realtors as part of their commission fees is 5-6% but depending on your area you may notice that that percentage is either higher or lower. In any case, that real estate commission charged for the sale of the home is normally split and covers both the seller’s real estate agent and the buyer’s real estate agent. Most homeowners will factor the commission rate into the price that they are selling their home for so that is something that you will need to consider both in cases where you are selling or buying a property. 

What is a fair real estate commission?

A fair real estate commission may vary depending on your area, but normally the seller’s real estate agent will charge 3.5-3% and the seller’s real estate agent will charge a similar amount. There are some areas where the commission fees that real estate agents request may be as high as 10% but those high commission fees are usually dependent on the area. To determine what the average commission fee in your area would be you may want to contact a number of agents who work in your area, they will be able to assist you by providing you quotes for their service. By averaging those quotes, you may find that the commission that is fair and normal in your area is lower or higher than that 5-6% that is average nationwide. 

Are listing fees negotiable?

Most things in real estate are negotiable but that does not mean that your real estate agent will necessarily be willing to lower the listing fees that they are requesting. Still, there is no harm in you asking the question, especially since you may find that your real estate agent is indeed willing to negotiate the listing fee with you. 

What is a reasonable real estate commission?

In most states, the average commission is 5-6% so anything within that range would be considered a reasonable real estate commission. However, there are certain places where the real estate commission fees may be higher or lower, therefore it is important that you take some time to research the agents in your area and to see what the commission rate that they are requesting is. 

In general: 

• Average Real Estate Commission total 5-6%
• In some places, the real estate commission may be as high as 10% 
• Average seller’s real estate agent commission 2.5-3%
• Average buyer’s real estate agent commission 2.5-3%
• The real estate commission is usually split between the seller’s and buyer’s real estate agents. 

Do you pay estate agents if you don’t sell?

Whether you will need to pay the estate agent’s fees if you do not sell will depend on a variety of different factors. 

1. The contract: If your contract has a ‘ready, willing, and able purchaser’ clause and you withdraw from a sale you may still be required to pay the agency fees. This is because your real estate agent will have gone through all the steps needed to list your home, find the prospective buyers, and initiate the sale of your property. 

2. If however, you do not have that clause within your contract you may be able to just pay the fees incurred by the creation of the photos for your home and the advertising costs. This means that you will have to pay a very small amount of money and one that is often negligible when compared to the entire amount that you would have to pay a real estate agent. 

Is Realtor commission negotiable?

Most things in real estate are negotiable, the realtor’s commission fee is one of those things that you can always ask and see if they would be willing to negotiate with you on. However, do be aware that most real estate agents may not be willing to lower their commission fees a great deal and that the average commission fees that real estate agents tend to settle on are around 5-6%. 

How can I lower my realtor fees?

Lowering your realtor fees is not always an easy thing, but as a seller, there are a number of different options that you could consider if you are looking to lower the amount that you spend on your real estate agent. 

1. List your property on your own. 

By listing your property on your own or through a service that offers a flat fee for listings you may be able to sell the listing fee commission which is normally around 3%. As the seller, that means that you may be able to sell your property without having to pay a seller’s commission fee. 

2. Negotiate with your agent. 

Negotiating the commission rate that your agent is requesting can be a great way of reducing the amount that you are called to pay for that sale. This is a great way of benefitting from having an agent while also limiting the costs of the transaction. 

3. Avoiding Sole Selling Rights clauses. 

If the real estate agent that you are selling through makes you sign a contract that gives them sole selling rights, then you will be required to pay their commission fees even if you find a buyer entirely on your own. This is a clause that most people in real estate avoid since you can never know whether you will be able to find a buyer on your own or you will end up needing your real estate agent. In any case, avoiding this clause could potentially help you save quite a lot of money in real estate fees. 

What is a standard real estate commission?

The standard real estate commission in most areas ranges between 5-6%. That commission fee is normally divided between the seller’s and the buyer’s real estate agent. The usual split is 50/50, but there are occasions where the two may decide on an unequal split of the commission fee. In a case, the standard is that the seller’s real estate agent will receive 2.5-3% and the buyer’s real estate agent will receive an equal amount. There are some areas where that amount will be higher and the average real estate commission fee is larger than 6%, with it sometimes reaching values closer to 10%. This might depend on your area so it is always best to check with the real estate agents in your area to see what the commission rate that they are charging averages out to. 

Why do Realtors get 6 percent?

Realtors carry out a number of tasks that make the sale of the property much easier for the seller. That 6% commission fee is usually split between the seller’s and the buyer’s real estate agent. For the sale of property, both of them will have to carry out several tasks, although in most cases the seller’s real estate agent will have to carry out more tasks than the buyer’s real estate agent. These tasks usually include: 

• Arranging the photography for the listing
• Completing market analysis and research
• Staging the home
• Advertising the Property
• Arranging open house events
• Representing the seller during negotiations
• Arranging and drawing up the closing documents

The buyer’s real estate agent on the other hand usually handles the following. 

• Brings prospective buyers
• Helps with buyer’s offers
• Represents the buyer in any negotiations
• Assists with closing on the home 

Can you work with more than one realtor?

Working with more than one realtor is usually possible if you have not signed an exclusivity contract with a particular real estate agent. Some real estate agents may request that they are the sole representation for your home, and they may add an exclusivity clause in your contract. In the cases where your real estate agent has added that clause, you will be unable to contact and work with other real estate agents, but if such a clause does not exist in your contract you are well within your rights to seek further assistance and representation. 

Summary:

Real Estate commission fees are there to cover both the tasks carried out by the seller and the buyer’s real estate agent. In most cases the average fee is around 5-6% but depending on the area that you live in that amount may be larger or smaller. Before signing on with a real estate agent it is often best to shop around and negotiate the commission rate where that is possible.