Charging a brokerage fee for renting an apartment you own

[Kevin Hutchens]

Hi Everyone,

I was helping a client find a rental in the metro west area outside Boston and I noticed real estate agents who owned and managed the units they are listing were charging a brokerage fee to the potential tenant (my client) to move in to their home.

I thought this was weird because why would an agent want to collect a fee from their potential tenant on top of first, last & security. I know they’re going to take that fee, split it with their broker and use it to count toward their commission goals for the year, but still it just didn’t seem necessary. Plus it can add thousands of dollars on top of the already high move in cost.

Normally, a landlord (non-agent) would be putting up the brokerage fee to pay their listing agent to market, screen and place the tenant for them and sometimes the renter’s agent who brings the renter gets a piece and sometimes not.

Any thoughts on charging a brokerage fee in this way?

[Nathan Gesner]

I set up a stand on the side of the road and sell bananas and hot sauce for $2 each, you may drive by and wonder why I'm doing that. It's stupid. Who buys bananas and hot sauce together? Why is both products priced the same when one is typically more expensive than the other?

It doesn't really matter. A product is on the market and your client decides whether they want it and what price they are willing to pay. The seller's reasoning shouldn't factor into the decision.