Determining The Commission To Be Paid On Your Home Article

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Determining The Commission To Be Paid On Your Home

There are some simple steps to determining the commission to be paid on your home. The commissions that are paid out with the sale of a house are based on a couple different factors and decisions of the sale.

Author: Tireddadoffive

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However in general it is roughly 5%-6% of the total sale of the real estate.

When you are determining the commission cost, it is a good idea to know where that commission goes. Here is a run down of what the Realtor, listing agent or broker will do for the commission you pay.

Help prepare the property for sale
Complete a market analysis
Follow up on the property inspection
Recommend an asking price
List the house and publicize the property to prospective buyers
Show the house
Negotiate the final price
Complete the legal documentation at the closing
Make referrals to other professionals that are key players in a real estate transaction

When you are considering the different commissions that can be paid out, there is also a cost for the buyer’s agent. However this cost is usually a split from the 5%-6% you are already paying.

With the numbers you are looking at, if your house is worth $200,000 then the total amount you are paying out in commission is around $10,000 to $12,000. Here is a break down of where that money will be split up and used.

There are three main areas that the real estate commission is usually split up.

Fee for services completed by the Realtor, agent and or broker Buyer’s agent split Advertising of your house

Often times people thing that they can save money, by negotiation of the commission from the sale of their home. When you figure out the actual amount of money a Realtor, agent or broker makes from the sell of a home, it is not likely that they will negotiate their fee. This is because for the amount of hours a good Realtor will put into the sale of a home, there is not that much that they receive.

Therefore the commission on a home of $200,000 is $10,000. That seems like a great deal of money, though look at the actual split. Out of $10,000 $3,000, goes to the advertising of your house. This includes listings, signs, open houses, literature and more. Then the final $7,000 is split between the buyer’s agent and the Realtor. If a Realtor works for 3 months 5 days per week to sell your house, they are paid $58 dollars a day approximately. That is not much different than the average wages.

Therefore when you want to negotiate the fee on the commission for the Realtor, agent or broker, you may be negotiating the cost of the Advertising. That advertising is going to be what makes your house sell faster, and for a better price.

With roughly 83% of all homes being sold today, a Realtor or some type of agent are used to complete the sale. Roughly 70% of all homes sold with a Realtor sale for more money.

Most homes that are sold with the assistance of a Realtor or agent are roughly 12% more.

So, instead of $100,000 you could get $112,000. That is a bit of a profit, just from paying out for a Realtor.

Remember that though owners have sold many homes, they usually sell to family or friends and sell for less. It also takes longer to sell a home without a Realtor and therefore will continue to cost you mortgage, utilities and hassle of upkeep.

When you are trying to determine the commission and what it is used for with the sale of your home. It is important to consider the hassle and cost of both money and time you will be cheating yourself out of. It is well worth the cost for the profit you can make, the time you will save and the convenience of having a professional on your side.

About Author

Chuck Lunsford is the content for Tina Abraham, a well-known Wilmington North Carolina realtor. To learn more about how Tina can help you sell your house or buy the Wilmington NC real estate of your dreams click here or call us at (910) 790-7484.

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