Real estate agents offer a number of services to help enable property sales between homebuyers and sellers. The commission charged in exchange for these services is usually how realtors make their income.
Typically, realtors charge 3-7% of the final selling price, depending on the agreement between the seller and realtor. The fee is split between the seller and buyer’s respective brokerages. If, for instance, the agreed-upon fee is 5%, 2.5% may go to the seller’s agent, and 2.5% may go to the buyer’s agent.
However, some agents can charge a fixed fee with a smaller percentage, like 1%.
In some cases, the buyer’s broker may also charge a separate fee.
Can Sellers Negotiate Commissions?
Many home sellers want to know if it’s possible to negotiate commissions because rates of 5% and above make less sense now than they did decades ago due to changes in the real estate market. Agents are generating higher sales revenue nowadays due to significantly higher home prices while working more efficiently, thanks to the proliferation of real estate technology.
Sellers can always reach out to agents and ask if commissions are negotiable. However, the likelihood of getting a positive response to this question from a random unverified agent is low. Additionally, it’s hard to tell if a seller with lower commission rates is trustworthy and reputable.
An excellent option for sellers is to use the empowering real estate marketing place called Nobul.
Due to the competitive nature of the platform, agents must justify their fee structures through the quality and scope of their services.
In an interview with BNN Bloomberg, the CEO of Nobul, Regan McGee, shared how his disruptive real estate marketplace is a truly competitive platform.
He explained, “Our marketplace is a competitive marketplace. Agents that want to charge 5% can justify the 5% through their reviews and service proposition. That’s great. [But] If they’re doing something that’s more like a 3% job, that’s going to come out as well. So, it’s really about consumer choice.”
On average, users are saving 0.5% on standard agent commissions on Nobul due to its innovative take on realtor fee structures.
Can Buyers Negotiate Commissions?
Since sellers usually pay the commissions on a sale, buyers typically can’t negotiate the commissions. However, they enjoy all the services of an agent for free.
Some agents also offer buyers cash back incentives. Here, they offer a percentage of their commission as a rebate to a buyer who chooses to purchase a home by using their services.
Can Sellers Avoid Paying Commissions?
Experienced sellers can avoid paying commissions by working directly with buyers and skipping the need for a middleman like a real estate agent.
Although the savings achieved from working directly with a buyer can be considerable, sellers must negotiate with buyers, market their property, and complete all paperwork themselves when working without an agent. Moreover, they must find buyers willing to purchase homes without professional help.
When Are Commissions Paid?
Commissions are usually paid after the completion of a real estate transaction. More specifically, the commission is deposited after the title is transferred to the buyer and all funds have been exchanged.
Consider real estate commissions carefully before matching with a realtor to sell your property. Knowing the exact commission rate will help you plan for the transaction and avoid unexpected hurdles.
On Nobul, you can always match with an agent who charges a rate you’re comfortable paying.
