About Real Estate Commission Rates

Did you know real estate rates can be negotiated? Two out of three sellers hire the first agent they contact and end up missing huge savings because they do not negotiate the commission rate.

                                                                           

 How rates work

The average commission rate (depending on the area you live in) is 6% to 7% gross sales on the property. However, because of a recent proliferation of discount and the Flat Fee MLS by owner, (this gives the seller the edge in real estate competition), firms have lowered commission rates to just above 5%. This number may not seem like a lot compared to your homes value, it actually represents a large portion of your home’s equity. (Equity is the amount of money the seller gets to keep after all expenses are paid). To properly negotiate the commission rate of what your home should be, determine what the value of your house is so that you can make a fair negotiation.

 What to consider before negotiating

1)    Do you have other properties to sell?

§  If so, you may be able to negotiate for a volume discount!

2)    Is your home in good condition to make a quick sale?

§  The longer your house is for sale, the more money your agent spends on marketing it.

3)    Are you in a buyer’s or seller’s market?

§  In a seller’s market, houses tend to sell faster and for more money.

4)    Does your agent have a buyer ready to purchase?

§  Your agent makes twice as much if they list and sell your house without a second agent involved.

5)    Does the broker have a variable commission rate?

§  You will pay a lower commission rate without a second agent involved!

6)    Are you able to offer a loan to the buyer?

§  When selling your home, offering a loan will make your property more attractive to buyers, therefore it will make it easier to sell.

7)    Are you willing to do some of the marketing and selling of your home yourself?

§  If you are, consider the Flat Fee option. Fees are determined on where you live, VT real estate commission rates are low depending on what broker and agent you use. A package could be $350!

 Other options to consider

 If you cannot find an agent that will settle with a reduced commission rate, consider a flat fee company. Flat Fee companies are there to offer the seller services on an “a la carte basis”. This allows you to choose the services YOU want to use, instead of the traditional route and bundling all the service together. It is based on a fixed price instead of the percentage. Keep in mind that this Flat Fee is paid when everyone agrees on the listing.