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COMMISSIONS & HOW THEY ARE PAID More than 90 percent of commissions paid in the area are either 5% or 6 %. These are divided equally between the selling and listing agent. Roughly 7 percent of listings fall outside of these percentages with nearly 6 percent above the 5 or 6 percent mark and about 1 percent below these standards. The trend has been towards higher commission rates amongst full service brokers as longer listing periods and greater marketing efforts in time and expense are required in order to sell. A recent sampling I took from the 95758 Elk Grove area, revealed 452 Active Listings on 233 @ 2.50% (nearly 52%) 185 @ 3.00% (41%) 007 @ 2.75% (<2%) 007 @ 4.00% (<2%) 006 @ 5.00% (<2%) 006 @ 2.00% (<2%) 003 @ 3.50% (<1%) 001 @ 1.00% 001 @ 2.25% 001 @ 3.25% 001 @ $2500 (flat fee) 001 @ 3.00% (plus $5000 bonus) The Listing Agent is usually paid the same as the Selling Agent but when commissions go above and below the industry standards the Listing Agent may be called upon to lower his commission rate. My recommendation to you if you are selling is not to lower the selling commission below 2.5% as it will reduce the number of your showings and hurt your ability to sell. Property inventories are high and when professional compensation is compromised the property can easily be overlooked. In general, all brokers will be more motivated to show and emphasize your property when they are professionally compensated. A professional fee for professional services rendered is understood. Discount brokers cannot possibly give you the time and attention that you may require. Services and time allotment have to be cut in some way. They must by definition look to volume for sales numbers and conduct more transactions due to their discount. Their time and resources are compromised. When you sell your home at industry standards you greatly increase the number of showings which in turn increases the odds of more offers and consequently a better selling price. Your success is greatly enhanced by the use of a qualified Realtor, like me. In todays market, I believe it is best to think first that the main priority is to obtain a qualified buyer rather than saving a few dollars in the process. You save nothing if you do not sell. Terms and conditions are all negotiable by law. Keep in mind that there is a lot more to a transaction than only commissions. For example, FSBO (For Sale by Owners) often are motivated to pocket more money at the end of the sale of their home and yet statistics show that sellers represented by a real estate professional average 16% higher selling prices that a non represented seller. You have to ask yourself if saving 6% offsets a lower price of 16%. Come talk me and lets discuss your particular situation and the value that I can offer you. I will show you how I can put more money in your pocket at the close of the transaction. I also provide a Net Sheet (estimated closing statement) to help you evaluate if selling is the right thing for you to do. |