Is it rude to ask a realtor for their commission?

3 Reply

Billy Daniel

Rental Property Investor · Russellville, AR · Member since 2014 · 684 posts · 509 votes

5y

The commission should be a normal part of the "interview". Almost everyone asks what the commission split will be when they list. Is the new agent local? If not, I would go with your old agent, despite the cost. Even in this red hot market, there are still properties sitting for weeks. A local agent will know your true market conditions.

2 Reply

Lien VuongBusiness Member

Real Estate Agent · Boston, MA · Member since 2018 · 2k+ posts · 1k+ votes

5y

You have every right as a consumer to ask your agent what their fees and services would be, especially for selling what's likely your largest asset. I think this would be a situation where you're not only screening for their fee but important to assess their selling skills, portfolio of work, as well as recent experience working in your area. When you can have both agents present their work and compare apples to apples and who will perform the best work for you. I had recommended a local client of mine an agent in a different state and while he charged the largest fee and was the third agent in the interview process, he completed the sale in success. You owe it to yourself to go through the proper due diligence, it's not what you pay, it's who's going to give you the biggest net profit.

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4 Reply

Theresa HarrisPro Member

Member since 2019 · 15k+ posts · 11k+ votes

5y

Whenever you sell a home, talk to 2-3 realtors and have them view the home, tell you what they think they can sell it for and ask them how their commission works. Also ask them how they market the home and how many homes they have been selling as the seller's agent. You are interviewing them for a job to sell your most valuable asset.

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Russell BrazilBusiness Member

Moderator

Real Estate Agent · Washington, D.C. · Member since 2012 · 17k+ posts · 30k+ votes

5y

Negotiate it.

Be aware though, the agents who cave and drop their commission the quickest.....do you want them negotiating the sale of your house?

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9 Reply

Wayne Brooks

Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes

5y

Agree with @Russell Brazil.....agents who drop their commission are generally weak, or just need the sale. If they won’t negotiate hard for their Own money, how hard will they negotiate for yours? Stepping over dollars to pick up pennies.

7 Reply

Wale LawalBusiness Member

Real Estate Broker · Houston | Dallas | Austin, TX · Member since 2018 · 5k+ posts · 2k+ votes

5y

@Brian Keegan

Commissions split are generally negotiable in almost all states. It's standard 6.0% (3.0% to buyer's agent and 3.0% to seller's agent) in Texas.

The commission split should always be part of the questions you ask a potential listing agent during your first meeting or interview. Agents who quickly lower their commission are less experience and maybe desperate for sales.

Great agent will not lower their commission except you and the agent will be splitting the tasks to get your house sold.

Go with an agent that you trust and comfortable with so in this situation I would go with your old agent, despite the cost.

As @Billy Daniel clearly mentioned that even if the market is a seller's market and properties are selling above the asking price, there are still properties sitting for weeks or months.

All Real Estate is Local so a local agent will know your true market conditions.

Goodluck man!

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Tracy Minick

Rental Property Investor · Monroe, WA · Member since 2018 · 177 posts · 98 votes

5y

@Brian Keegan

I am not a fan of letting agents know what others are charging you so that the 2nd can come in lower. If you are looking for a discount consider using a discount broker or say this to each agent: can you give me your best and final listing quote for commissions?

Good luck

Angela Yan

Rental Property Investor · San Francisco, CA · Member since 2017 · 206 posts · 138 votes

5y

It is such a seller’s market right now. I think it is way easier to sell a place than to be a buyer’s agent. Certainly don’t be afraid to ask for the discount. Perhaps see if the listing agent will take 2 or 2.5 and the buyer gets 3? Or 2.5 and 2.5 i think is reasonable. Especially if you are 1031 exchanging and may use them again.

Jim Fichera

Investor · Amherst, NH · Member since 2017 · 42 posts · 20 votes

5y

@Brian Keegan There is nothing wrong with asking an agent their commission or asking them to come down on it. In this market agents are desperate for listings. On that note a good agent may be worth the additional commission simply because they are better negotiators. I’d first start with asking both how they handle offers. See if they bring up how they negotiate. Ask how they handle multiple offers etc. You could also ask if they can give you a reference of someone they have worked with in the past that involved a lot of negotiation. Just because a realtor is friendly doesn’t mean they are a good negotiator. Once you have narrowed down who you want ask about their commission rate. Tell them you are tryung and

Jim Fichera

Investor · Amherst, NH · Member since 2017 · 42 posts · 20 votes

5y

@Brian Keegan continued......

Tell them you are considering another agent as well and you would like the best rate possible even though you have already decided.

Henry Lazerow

Real Estate Agent · Chicago, IL · Member since 2017 · 2k+ posts · 2k+ votes

5y

The good agents won't give you kick backs. Sure you can find a lot of low producing desperate agents to do it but you probably will end up netting a higher amount from the sale using a good realtor.

George PaquettePro Member

Investor · Member since 2020 · 39 posts · 20 votes

5y

@Brian Keegan I would say yes. List it on a FSBO site or pay the professional a fair wage if you want professional service IMO.

Charlie MacPherson

China, ME · Member since 2014 · 3k+ posts · 4k+ votes

5y

@Brian Keegan As others have said, an agent who drops his commission quickly isn't a good negotiator - and negotiation is one of the skills you're screening for. A strong negotiator knows when and how to say "no" - especially when it comes to things like post-inspection negotiations.

Ask how and when they will list. There's a recipe for creating the best chance of a bidding war. That includes the right day of the week to list, a specific strategy for open house timing and solicitation of offers as well as a strategy for dealing with multiple offers. If they can't tell you step by step what that recipe is, I'd move on.

The other thing to watch for is agents who will try to inflate the asking price to win your business. That is a very common tactic and is really slimy.

Ask each agent you're interviewing to come up with an asking price and show you exactly how they got there. If they don't present current comps (within 60 days or less) for sold (not listed, pending, canceled or expired) homes, withing 10% of the living area and acreage, similar in age and condition, etc., they're winging it. That's not someone you want working for you.

Of course you can and should ask about commissions, but I'd much rather have a sharp agent at full price than a weak or discount broker who leaves a pile of money on the table.

Marian Smith

Real Estate Investor · Williamson County, TX · Member since 2011 · 1k+ posts · 961 votes

5y

@Wayne Brooks Probably varies by scenario. I use a "full service" broker who has presented two offers for me and kicked back 2.5%. They were clean, cash, full price offers and had he not written the offers I would have used a different 2% kick back broker I have used before. I plan to see what kind of discount he will offer on a listing I have coming up. I have used a $500 flat fee listing service in the past but I suspect KW blackballs those in my market but in todays market it probably wouldn't matter anyway.

Jon Wright

Real Estate Agent · Tuscumbia, AL · Member since 2015 · 47 posts · 26 votes

5y

@Brian Keegan I’m an agent and an investor. Everything can’t be measured in $. If you’ve had a relationship with this agent for 3 years that has to be worth something. If he or she has kept up with you or answered questions for you for 3 years that has to be worth something. The market is super competitive right now because people know if you list something it will sell. I’d go with the person who has invested their time and effort into helping you reach your goals along the way. Best of luck!

Caleb Brown

Real Estate Agent · Kansas City · Member since 2018 · 4k+ posts · 3k+ votes

5y

I wouldn't base the decision on the commission amount. Base it on reviews, track record, listing presentation, how they market, communication, honesty, etc. Which ever realtor would reduce their commission first shows they aren't the best negotiator. If they don't object and immediately drop the commission rate then how will they do during negotiations for offers, inspections, etc? Selling a home is a big decision and I wouldn't base it solely on who will take "less" on their paycheck

2 Reply

Joe SplitrockPro Member

Moderator

Rental Property Investor · Sioux Falls, SD · Member since 2015 · 9k+ posts · 18k+ votes

5y

There is a major inventory shortage and houses in many markets are selling the day they hit the market. Agents are fighting hard to get listings. There are plenty of highly capable agents who will discount to earn your business. If it was a slow market and they had to advertise your property for months, it may be different. Agents are working harder on the buyers side than they are the sellers side right now.

Just be honest with the agents. Ask them both to do a price analysis and provide you a proposal. Tell them you are asking everyone to include a discount on commission with their proposal.

Felix Andrei

Member since 2019 · 8 posts · 1 vote

5y

Yes it is rude. If you don’t want to pay them then don’t hire them and sell the home yourself.

Let’s suppose you work at the bread factory. Is it rude to ask for your wages when we buy the bread you are making so we can use it to buy the bread?

Everybody has to work for a living. And if they are willing to drop their commission which is earned by their hard work and through being licensed, being at risk of high liabilities etc. then how do you feel about them negotiating on your behalf with what is likely one of the priciest assets you own?

If you trust your agent make them fight for you, have them understand the importance of your loyalty and the trust you put in them and pay them LOTS. You will have an ally to your cause.

Dwayne Byrd

Real Estate Broker · Palm Bay, FL · Member since 2017 · 175 posts · 89 votes

5y

@Brian Keegan cheapest isn’t always best. It also depends on the price range of your home. What a lot of people don’t realize is that potential buyers agents sometimes skip homes with low commission. You will notice a higher amount t of showings and offers at the standard 3 percent rate.

Like others have said, if the agent caves in your negotiations, they will likely do the same on your behalf. The market is hot, but some people are missing out on thousands by trying to save money on the agent or trying to do it themselves. Pay a good agent, get it done and move on down the road with everyone being happy!

Scott WolfPro Member

Lender · Boca Raton, FL · Member since 2014 · 1k+ posts · 957 votes

5y

@Brian Keegan, I'm going to take a contrarian view, since a lot of people have echoed the "someone that quickly drops their commission isn't a good negotiator." sentiments.

Since you haven't mentioned your area, if the market is on fire (like most places) they might be willing to drop the commission to get the listing, as it may be a guaranteed payday vs. otherwise. I'd pay more attention to the pricing part of the equation. If they stick to their guns on the pricing and can back it up, (even if you want more) it shows true knowledge of the marketplace, and you'll be more likely to get a bidding war or quick sale.

As for telling the agents, I'd simply say, I'm interviewing multiple agents and picking the one I deem best for the sale. I wouldn't even mention cutting their commission until you get a full market analysis and what they would list it for.

Good luck!

Harrison Sharp

Real Estate Broker · DFW · Member since 2015 · 350 posts · 270 votes

5y

you get what you pay for. I know my worth and don't discount my services. A good realtor will net you more anyways.

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Michael K GallagherBusiness Member

Real Estate Agent · Columbus OH · Member since 2018 · 1k+ posts · 1k+ votes

5y

@Brian Keegan honestly, if your attitude is "any realtor can sell it" just FSBO it. If you see value in a realtor and they are not getting anything on the "buy side" because you are moving out of state then pay the full commission. In my opinion you get the service you pay for. Discounted cost gets discounted service.

Totally just my opinion though.

Tchaka Owen

Real Estate Agent · Merritt Island, FL · Member since 2017 · 974 posts · 1k+ votes

5y

Originally posted by @Brian Keegan:

Trying to decide who to go with. Since I feel comfortable with either, so I guess I would rather go with whoever will charge me less commission. How would you negotiate commission in this scenario?

This is a common mindset and it's also the wrong one. We all want to save money and the first place people want to trim is the commission and in a sellers market, most neophytes will come out with the, "oh, anyone can sell this house" routine.

NO. The question you should ask yourself is which agent will do the best job to net you the most. The agent who charged you 5% total and sold your home for $200k didn't perform as well as the one who charged you 6% and sold it for $203k. Chances are the agent who knows his/her worth will actually sell it for $205k, maybe more. For the record, I'm a licensed practicing agent as well as an investor and in the instances I've hired other agents, I've never paid less than 3% to one (that means 6% total). I don't negotiate commission, though I often ask for the purpose of hearing an agent's response.