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Consumers have been concerned about what they perceive as high real estate agent commissions for decades. Skyfor, a real estate consumer education and referrals company, recently conducted a review of closing statements to determine commissions typically paid by consumers to real estate buyers agents. The company reviewed about 80 closings that occurred last year throughout the United States. The review showed that on the buyer’s side, almost 100% of all closed deals still showed a 2.5% to 3% commissions based on the sales price allocated to the buyer broker at closing. A similar amount was also paid out of closing to the listing agent. This total of an average of 6% is the same amount of commission that has typically been paid to real estate buyer professionals for 2 decades.
The report may be seen at http://buyeragentsearch.com/typical-buyers-agent-fees-salary-expect-duties-definition/
The spokesperson for Skyfor said, “Our advice is to always ask for a discount” and ask the agent to justify their fees in an interview session. Many will make at least some slight discount. If the agent does not discount their commission in the up-front agreement , sometimes later in the negotiations process the agent offers to throw in some of their commission to help pay for needed repairs in order to keep the deal on the table, thereby protecting their commission.
The buyer typically does not pay any upfront fees as the buyer agent fee is built into the sales price of a home, land, or commercial property, and is covered in the seller’s listing agreement. The spokesperson who wrote the report said, “Most of the commissions we saw in this closing paperwork showed the typical commission to be from 4%-7% of the sold price of the property, with the average being around 6%.”
Sometimes buyers are asked to pay a reasonable retainer of $200 to $500 to the agent up front. Retainers are a somewhat infrequent practice, but can be as much as t $3,000. The retainer comes out of the agent’s commission at closing, so it is only an extra cost to the consumer if they don’t buy with that agent.
An example of the $200 retainer might be for a typical home purchase in the $200,000 to $300,000 range. This retainer is used to cover to cover initial work, gas and office expenses. The report talks about one agent who charges a $3,000 retainer because he uses his private jet to fly high-end buyers around the US and Costa Rica. Tom Vose, a broker who lives in Denver said “When they are serious buyers they understand and don’t hesitate to give me a $3,000 retainer”.
Skyfor encourages all real estate buyers and sellers to proactively become involved in understanding their agent’s fiduciary duties if they agree to be their agent. One duty that is common within all states is confidentiality of the client’s information. Nearly all licensees also belong to the National Association of REALTORS, which have high standards for the duties expected of a real estate professional, whether they are in an agent or broker capacity. The other duties are defined as obedience, loyalty, disclosure, accounting and reasonable care.
Many people do not realize that both listing agreement and buyer agency agreements can be customized through a mutual agreement of the parties. Cancellation clauses and duration of the agreement are two important items to be examined.
The report warns about how real estate professionals can enter into neutral “transaction” or “facilitator” roles that may be less beneficial to consumers than an agency relationship
An explanation of these roles and how to take control of the real estate buying or selling experience is available at the company’s Youtube channel https://www.youtube.com/channel/UCjbX1mE37g9WneSOEJe4Dbg
Release ID: 314674