Listing Commissions and Related Issues
About
Commissions
In most areas there is a
customary percentage that real estate agents expect to earn
as a commission. When completing the
listing agreement, you and your agent will negotiate and agree on the amount of the
real estate commission.
When you
discuss commission with a listing agent, you should
keep in mind that there are usually two agents involved in
most transactions. Most of the time, only part of
the commission goes to the listing agent's company.
The other portion goes to the company representing the
buyer.
Some
commission-related questions you could ask:
Will your property be listed in
the Multiple Listing Service?
Being listed
in the MLS expands your sales force. Every
agent is invited to bring potential buyers to
your property. This larger supply of buyers
effects your pricing power and the ability to
sell your home more quickly.
What is the effect on the company
representing the buyer?
Since part of the
commission usually goes to the company representing the
buyer, you may want to ask whether that portion of the
commission offers the customary amount. As mentioned
above, the more agents that show your property, the more
pricing power you have and the more quickly your home will
sell.
What is the effect on marketing? Very
few properties are sold through advertising or open
houses, but it does happen. Most often, those ads generate calls from potential
buyers or sellers, who end up as clients for real estate
agents -- and you want agents to bring potential buyers to
your property. Advertising your property to other
agents has a higher impact than direct advertising to
consumers.
Will you be tied in to other
services? A real estate company with
bundled services has more income opportunity which may
allow them to offer lower prices. However, there are
a few companies whose additional services are not priced
competitively with opportunities you can find on the open
market. You should be sure to ask lots of questions
and determine whether you are limited to certain choices
or you have the freedom to also explore the open market.
copyright 2000 RealEstate ABC, revised 2002,
2003, 2003
|
