If you’re in a slow housing market, which is most of the country, then a good real estate agent is worth his or her weight in gold. And, to be sure, that’s what they’re going to charge you. But commission is always negotiable, and there is one area of the contract that is often overlooked by the seller; an area that can potentially save the seller thousands in real estate commissions.
When an agent represents both the buyer, as well as the seller, this is considered a double ended transaction and is the dream of many real estate agents. Most would kill to double end a transaction; and with very good reason. This type of transaction is often much easier for the real estate agent. When an agent controls both sides they not only have a much easier time with paperwork, but they also make twice the commission; their original commission to sell your home plus the buyer’s agent commission. This is where the seller should be negotiating.
Before the listing contract has been signed, address this issue. Many agents will never bring this subject up, letting the seller assume the commission offered will always go to the buyer’s agent and realistically most of the time it will, but in the event your agent does find a buyer, negotiate a lower commission based on these factors:
Your agent will be controlling the transaction from both sides including all necessary paperwork, which often can be the hardest part of the transaction.
The double sided transaction is often easier for the real estate agent since they have direct access to the buyer, this makes negotiating easier, problems that arise can be handled quicker and often potential cancellations can be avoided.
Be prepared to give a little in order to get a little. Offer a slightly longer listing period in exchange for a discount on the two sided transaction. Most agents will look at this favorably and are more likely to accept, knowing in a slower market most homes average up to 90 days or more on the market before they sell.
Keep these factors in mind when negotiating, but also understand, the agent who represents both sides in a transaction also assumes twice the liability and has twice the likelihood of being sued. Expect the agent to explain these and other factors in order to validate their worth, and they are worth a decent commission, so don’t try to undercut them so badly that the commission offered becomes an insult. Simply let the agent know that if this situation arises you expect at least a one point discount and maybe as much as a point and a half. These discounts are based on an average 6% total commission with the sellers agent and the buyers agent each receiving 3%.
Commission is not the only issue to be concerned with when selling your home so don’t choose an agent based solely on commission; but being prepared to negotiate this issue, explaining to the agent why you feel a reduced commission is expected, can be much easier if you have all the facts and understand the agent’s point of view. Negotiate honestly and realistically and you have the potential to save thousands on you real estate commissions.
When an agent represents both the buyer, as well as the seller, this is considered a double ended transaction and is the dream of many real estate agents. Most would kill to double end a transaction; and with very good reason. This type of transaction is often much easier for the real estate agent. When an agent controls both sides they not only have a much easier time with paperwork, but they also make twice the commission; their original commission to sell your home plus the buyer’s agent commission. This is where the seller should be negotiating.
Before the listing contract has been signed, address this issue. Many agents will never bring this subject up, letting the seller assume the commission offered will always go to the buyer’s agent and realistically most of the time it will, but in the event your agent does find a buyer, negotiate a lower commission based on these factors:
Your agent will be controlling the transaction from both sides including all necessary paperwork, which often can be the hardest part of the transaction.
The double sided transaction is often easier for the real estate agent since they have direct access to the buyer, this makes negotiating easier, problems that arise can be handled quicker and often potential cancellations can be avoided.
Be prepared to give a little in order to get a little. Offer a slightly longer listing period in exchange for a discount on the two sided transaction. Most agents will look at this favorably and are more likely to accept, knowing in a slower market most homes average up to 90 days or more on the market before they sell.
Keep these factors in mind when negotiating, but also understand, the agent who represents both sides in a transaction also assumes twice the liability and has twice the likelihood of being sued. Expect the agent to explain these and other factors in order to validate their worth, and they are worth a decent commission, so don’t try to undercut them so badly that the commission offered becomes an insult. Simply let the agent know that if this situation arises you expect at least a one point discount and maybe as much as a point and a half. These discounts are based on an average 6% total commission with the sellers agent and the buyers agent each receiving 3%.
Commission is not the only issue to be concerned with when selling your home so don’t choose an agent based solely on commission; but being prepared to negotiate this issue, explaining to the agent why you feel a reduced commission is expected, can be much easier if you have all the facts and understand the agent’s point of view. Negotiate honestly and realistically and you have the potential to save thousands on you real estate commissions.
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