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Real Estate Commissions Are Actually A Positive Feature Of A Transaction
Dated: November 12 2018
Well when it comes to Real Estate it's a common question: Why am I paying this agent this commission? What I often say, is, what level of service do you want? If you want to pay a 1%-2% commission to your Listing agent and buyers agent how hard do you think they are going to work to sell your property? If a contractor is getting paid $4000 for one job and $500 for another which job do you think the contractor is going to spend the most time and attention on? The $4000 job, and he is going to make his level of service and time commitment much higher to that job. It's just a fact. Same with Real Estate commissions. This is how Realtors make their living, pay their bills, afford things for their children, etc. When a Realtor asks for a 5%-6% commission remember, half of that goes to the buyers agent who you and the Seller are relying on to bring buyers by to your property. Also, the Listing Agent will be spending part of his commission on Marketing, Signs, Promotion, Advertising etc. of the Sellers home (before they have earned any money on it) to promote and sell the home as quickly and for as much money as possible. That all takes time and money. If you're only paying each agent 1% or 1.5% commission, and they have other, or a majority of other deals that are paying 2.5%-3% commission, where do you think they're energy and time will be spent? The commission is part of the value your Realtor is providing and is expected to deliver that level of service to all clients as well as other agents. That's all important in doing good business. Plus, once you read the fine print of Zillow, Trulia, PurpleBricks, RedFin, etc. you almost always end up paying more than 6% at closing and receive a much lower level of service or no service at all. SO, I guess it just depends on what you want, but if you aren't willing to pay at least whats reasonable or standard, be willing to except a lower level of service from everyone in the transaction because that is most likely what you are going to receive.
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