How Much are Realtor Fees and Agent Commissions? - YouTube

Real estate agent commission can seem like a huge chunk of your home sale

profits.

But the truth is there's a ton of added value behind realtor fees that doesn't

always show up on the closing balance sheet.

We did extensive research and spoke to a few top agents to learn where every

penny of that commission goes and whether or not it's worth the cost to you.

[inaudible] hi, everyone Corinne here with HomeLight.

Let's talk about real estate agent commissions.

You're getting ready to sell your home, punching the numbers,

calculating your potential profit and boom.

The real estate agent commission looks like a major cost.

The standard real estate agent commission is five to 6% of the sale price.

So if you sell your house for $300,000,

your real estate agent will earn $18,000. What at burst,

that number seems like too much. I get it.

But the agent isn't pocketing that money to spend on a new car or a vacation.

In fact, they take home less than a quarter of it.

Here's how the commission actually works.

Your real estate agent receives 6% of the sales price when they close on your

home, but they split that 6% with the buyer's agent, 50 50.

So they actually only get 3% of the profit.

And then the agent's broker takes half of their half.

So now your real estate agent is left with about $4,500 for that

$300,000 home sale, much less than the $18,000. We originally thought,

and I'm not even finished yet.

Everything your real estate agent did to market your house comes out of their

commission, depending on your home.

Your real estate agent could spend $200 for online advertising,

$300 for professional photos, another $300 for virtual tourism videos,

$60 for an open house flyer and another $200 for office supplies, desk space,

and realtor membership fees. All of those services cost over a thousand dollars.

That being said, the agent's take home.

Cash is less than 1% of your sale price seems fair.

Right now you can technically negotiate the real estate agents commission before

you sign the listing agreement with them.

And some agents made and settled for 5% commission. So yes,

you'll walk away with a little bit more,

but that isn't necessarily a good thing for you.

Real estate agents that accept a lower commission will have less money to spend

marketing your home. Take it from Elizabeth Weintraub,

a top performing Sacramento real estate agent.

Who's completed more sales than the average agent in her area.

She had a client who chose an agent with a lower commission fee over her,

but in the end, the lower-cost real estate agent couldn't sell the home.

So he wanted me to discount my fee to what this other company was

going to charge him. And he said,

as far as I see they're going to do everything that you're going to do,

not what they're not, but I tell you what,

when you get into escrow and you get to the home inspection part and when you

don't get out of it, you can give me a call and sure enough,

it got into escrow and the home inspection came around and the whole thing blew

up and the agent didn't know how to handle it because deal with it and you kind

of lose. And then came back to me and said, I want you to list this,

put this in there.

See you get what you pay for.

And remember the commission is split with the buyer's agent when you're bargain

real estate agent lists your home buyers agents in the we'll see that the

commission is less than the standard and might pass on showing your house to

their clients because of it ethically real estate agents should not do this,

but just be aware that a lower commission could affect by our interest for

reasons outside of your control to recap your real estate agents commission,

isn't actually as much as it seems.

Once you factor in deductions to the buyer's agent, broker and marketing costs,

statistics show that selling your home with a professional real estate agent

will garner you a higher profit enough to cover the cost of commission,

as well as put more money in your pocket.

According to the national association of realtors,

the average for sale by owner sales price was $185,000.

While the average price for a home represented by an agent was $245,000.

That's a $60,000 difference. You see real estate agent fees.

Aren't that scary after all what's more important is that you sell your home for

the most money possible. And to do that,

you need a top performing real estate agent.

You can find the best agents in your area based on actual transaction data with

one quick click on homelight.com.

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