So I'm ready to put in my first offer, a small single family rental property, and received an offer agreement from my agent. Scanning through the pages I came upon a "compliance/transaction fee due to broker at closing" of $1,495, and when I pressed the agent he said that it's a compliance fee that his office charges for properties below a certain purchase price. My first reaction was to tell the agent and broker to take a hike...to me this is clearly some add-on fee used by the broker to increase their profit margin on smaller transactions. But on the chance that I'm being too hasty, I figured out reach out to you guys to get some feedback. Are broker fees customary? If so, is this is a reasonable amount?
Many brokers will not service properties below a certain price point, or will have a minimum fee to offset the low price point. I personally do not service properties if the commission is not at least $5,000.