What is a commission?
The commission is the compensation real estate agents receive for professional real estate transactions they perform. This fee is negotiable and therefore, varies from agent to agent. Agents in these matters could be the seller’s agents or the buyer’s agents.
How much is the real estate agent commission?
The commission is negotiable and varies based on experience, companies, etc. However, the average commission is around 5-6% of the total price of the property. For example, let’s assume that your client bought a $300,000. Your average pay will be $18,000 which is 6% of $300,000. The percentage is calculated before closing the deal. This commission will be split between the seller’s agent and buyer’s agent.
Who pays real estate agents?
It is sometimes hard to explain who pays real estate agents. When you are buying a house, your agent may tell you that the buyer will pay the commission fee. It is easy this way and everyone is happy in the end. Where do sellers get the money for these fees? Well, they take a percentage of the money you gave them and pay the fee. This cost is usually included in the total price of the property.
What do real estate commission covers?
When you buy a house using a real estate agent, you will do little work from start to finish. Your agent will show you listings, analyze the property, market conditions, locations, etc. Furthermore, your agent will help you with offers, negotiations, coordinate home inspections, appraisal, repairs negotiations, and closing paperwork, etc.
The fee will cover all these activities performed by your agent and many more we did not include here.
