Question friends, I have a realtor that found a buyer for my home but my question is he asking 5% for the deal and its a one party listing. Is that to high here in Milwaukee Wisconsin
5-6% is the norm in my market. I'd actually prefer if it all went to my agent (who is my "partner" without the partnership)...splitting is fine too.
Would you rather pay 6% and have a buyer in 2 or 3 months?
Wayne nailed it - and that's assuming you can find a buyer. In my opinion, 5% is well worth the time you should have saved with the single party listing.
5-6% is the norm here in KY
@Jose M. 5-6% is normal; however, you can ask for less. Was this listed as an FSBO and, if so, did you have a stated buyers agent premium in the listing? Normally that 5-6% gets split two ways 2.5-3% for the buyers agent and 2.5-3% for the sellers agent. If the listing agent also finds the buyer they get both. If you are acting as the listing agent on your property it would not seem unreasonable to me to offer them a 3% buyers agent commission. The question you have to answer is, is the deal too good to let them walk if the agent balks at the 2% difference?
5-6 percent is most common in my area. It does not matter whether it's a dual agency or not.
In fact, I've been asked by a seller to do a reduced commission amount AFTER contractually agreeing to 6 percent, because the accepted offer was a dual agency where I'd be representing the buyer. What? You want me to reduce the amount you've agreed to already give me, just to be nice? I politely said no, and that I would certainly never ever ask them to reduce their fee if they were my doctor or lawyer.
I think it's important to note something here that non-agents may not understand: if your agent is doing dual agency (representing both buyer and seller) they are doing twice the work they would otherwise do because they have to act as both buyer and seller agent. Normally they would split it with a buyer's agent brokerage because the buyer's agent has to deal with the headaches of representing the buyer (scheduling inspections, removing contingencies, giving the lender and escrow company everything they need, constantly advising them how to proceed, etc), which warrants half the commission amount. The seller's agent always has the seller's portion of the work to do (showings, presenting/interpreting offers, communicating with the owner/tenants to make sure inspections/appraisal goes smoothly, making sure the title company has everything to close, etc) which warrants that half of the commission. If they do both, should they not be paid for both?
I have purchased property with reduced commissions when not using a buyers agent, but it was in my offer. I have also sold property without a listing agent and only paid a courtesy to the buyers' rep (equal to their customary commission split) when they have representation.
If however, your listing agent finds a buyer, you should pay them the agreed upon commission. As Max Gradowitz stated, they've done the work of both representing you and the buyer. Why shouldn't they be paid for both?
I would like to ask a question that I don't believe has been addressed yet.....what is the price point that we are even talking about?
5% is fair all day long in just about any market.
Thank you so much for your time and your answer.
Free eBook from BiggerPockets!
Join BiggerPockets and get The Ultimate Beginner's Guide to Real Estate Investing for FREE - read by more than 100,000 people - AND get exclusive real estate investing tips, tricks and techniques delivered straight to your inbox twice weekly!
- Actionable advice for getting started,
- Discover the 10 Most Lucrative Real Estate Niches,
- Learn how to get started with or without money,
- Explore Real-Life Strategies for Building Wealth,
- And a LOT more.
Sign up below to download the eBook for FREE today!
We hate spam just as much as you
Join the Largest Real Estate Investing Community
Basic membership is free, forever.