I would love to know about this too. We recently started working with a realtor and need to buy and sell. The closing costs estimate she prepared for us to see how much we'd net from a sale at $x already had commission at 5%. Unfortunately, MH was the only one there when she walked through it, because I was kid wrangling, so I feel like I missed a natural opening to as about 4% if she handles both (I mean if she reps us and the buyer).
I hope someone else has actual advice for you on how to handle it!
Love of my life baby boy born 11/11. One and done not by choice; 3 years of TTC yielded 4 MMC and 2 CPs, through 4 IUIs and 2 IVFs. Focusing on making the world a better place instead...and running.
There was just a segment on our local news about realtor fees and they stated that most realtors in our area will drop from their usual 6-7% to 4-5%. When they bring up their fees, if it is higher than you were expecting, say something like "I was hoping for more around xx%" or Is your fee negotiable or can you lower your commission rate?
The worst they can tell you is no.
Our realtor, last time we sold a house, told us what her usual fee was but that she was dropping it to 4% for us (we were casual friends and our daughters were very good friends).
My understanding is that 5% is the discount rate for Boston but you can't go less than offering the buyers agent 2.5%. So that is why it's 4% if they are dusk agent. You might be able to go down to 4.5%, in which case 2% goes to sellers agent and 2.5% to buyers.
I know that a lot depends on their position in the office (the one that holds the brokerage license or just a regular realtor) or if it is part of a national chain, etc. Some allow for wiggle room and some don't. Sometimes they have an number of sales they can discount over the course of the year (like moolarkey 's agent did for them.)
I know of some who have negotiated down if the same agent is handling both the sale of their current home and the purchase of their next home.
And from what I can tell, their "rack rates" aren't that bad. Around here 6% is the norm for a standard sale.
I know that a lot depends on their position in the office (the one that holds the brokerage license or just a regular realtor) or if it is part of a national chain, etc. Some allow for wiggle room and some don't. Sometimes they have an number of sales they can discount over the course of the year (like moolarkey 's agent did for them.)
I know of some who have negotiated down if the same agent is handling both the sale of their current home and the purchase of their next home.
And from what I can tell, their "rack rates" aren't that bad. Around here 6% is the norm for a standard sale.
Since you "know" the area that we will be dealing with this year, do you think that since we have 2 interested parties already on FIL's main house (2 neighbors have called Mr. P that may want to buy), we have a REA for his other properties, but we don't have a contract on the main house. The REA (an independent) is charging 7%. Honestly, I don't think we should pay that for the main house. Of these options, what do you think we should do: 1. If we get an offer, should we just go to a RE attorney. 2. Tell the REA we've got 2 potential buyers and we will pay 5 or 6% on the main house. 3. Get a new realtor.
I haven't been overly thrilled with the service we've had so far. I have done a massive amount of "leg work" that I think they could have assisted us with. We originally went to them because the REA was someone we thought FIL would be more comfortable with when he was still around the properties. Sorry to crash RNV's post but wanted to get your home state perspective about this.
Pom I would say for the main house, treat it like a FSBO since you already have interested parties, haven't signed on with a realtor and go with the RE attorney. Especially since I wouldn't pay another 7% (or even 3.5% with you bringing the buyer) to someone who you aren't thrilled with (and who is charging you such a high rate even with two properties listed with him/her. Usually in a multiple property situation like this, you should get discount IMO).
I would also say that if you haven't signed a contract with your current realtor, get a new one. 7% is high for MI from what I know talking with my realtor contacts. 6% is pretty much the standard rate.
To answer OP, your deal is exactly what we had here in Texas when we sold our last house. The agent we used started out asking 6% but we negotiated down. We met with a couple of agents and told him another agent was coming in less so he matched it. Considering we/FIL is paying 7% in Michigan, this rate option sounds pretty good but it never hurts to ask. Depending on how hot your market is, I'd say there is negotiation.
Post by Balki.Bartokomous on Jan 31, 2015 10:59:16 GMT -5
I think you could probably get at least half a point off of those rates, if not a full point. 3% doesn't sound like much but when you consider the price of the house & the absolute $ figure you'll be paying, it could be fair compensation for the amount of work the REA does.
Here's what we did (the actual rate will depend on your market):
6% is the standard starting point here (but nobody actually pays 6%) Our REA offered to go down to 5% if he was our selling & buying agent We got him down to 4.5% plus some $ back when we closed on the house that we were buying, so at the end of the day our effective rate was about 3.75% For the sale of our place, he gave the buyer's agent the full 3% & took 1.5% for himself because he knew he'd make it up in commission when we bought our next place.
Post by bostonmichelle on Jan 31, 2015 17:07:23 GMT -5
Definitely ask. I know we've made deals with certain clients that are buying and selling. We've also done reduced fees if we get the buyer as well. I know a lot of fees near me are 2% for the buyer's agent but not sure about closer to Boston or your city.
Not sure if you can find the information on realtor or not but maybe see what they are offer for buyer's agents in your price range in your city, whether its 2%, 2.5%, or 3%.
We bought and sold with the same realtor. Standard is 6% here and she brought up that if we used her for both transactions, it would just be 5% for the house we sold (2% to her, 3% to the buyer's agent) before I could mention it. It's pretty typical for them to do that around here.