Who Pays Commissions?

Who pays commissions in a real estate transaction? 
 

Most people are unaware as to who pays commissions — unless you work in real estate. We’d like to shed some light on this subject. 
 
Here are the details:  
1. Typically, commissions paid within a real estate transaction are 6% of the sales price. Three percent goes to the listing agent (the seller’s agent) and 3% goes to the buyer’s agent.  
2. The total 6% is paid by the SELLER. The buyer pays ZERO real estate commissions when purchasing. 
3. Keep in mind, Realtors® — who are independent contractors — do not get paid salaries. So the commissions they make from a sale help pay for professional photography and/or staging, signage, MLS membership & dues (so the listing is advertised to as many people as possible), additional forms of marketing, broker splits, taxes, gas, insurance, time, and more! 
 

Furthermore, it’s important to know that not every Realtor® is created equal. Some discount agents will give sellers a discount — and therefore give discount-quality attention.

“But if I can save money, why wouldn’t I hire a discount agent?”

Know that a real estate expert will work hard to give the proper real estate advice based on market research, area knowledge, and experience. An expert will market and advertise your home appropriately, ensuring that you achieve top dollar for the sale of your home. There’s a lot that goes into selling your home, and making the right moves from the moment it hits the market is very important — so pricing correctly from the beginning is imperative.

What we see with discount-commission or flat-fee brokerages is that they don’t have the experience with varied sales, they are unwilling to go the extra mile to market your home, they will only add the listing to the local MLS and do little else, and they won’t communicate effectively. We’re not saying all discount brokerages are like this, but many are.

Think of it like this — would you hire a discount doctor to operate on your heart? Probably not. You want the doctor to be an expert, to have completed many heart surgeries, to know the potential problems that can arise (and how to navigate them), and to be able to make sure any and all details of the surgery (before, during, and after) are communicated effectively with you. Whereas you wouldn’t accept a discount doctor with your heart, don’t trust a discount agent with arguably one of the biggest transactions of your life. Great realtors know their value and their commission rate reflects it.

Finally, the great thing about our brokerage is that we work hard to earn your business and maximize your real estate goals! We are honest and will tell you the hard truths to help you get from point A to point B. You can trust that we have your best interest at heart when it comes to helping you with any real estate transaction.

Contact us today at 512-601-6365 or visit www.HomesteadandRanch.com! To get a start on selling your home, click here!