Q: 1) What is the typical range or fixed rate of commision for seller?s realtor when selling vacant land? How negotiable is this?
2) Does the qty of land (eg 2 acres vs 100 acres) affect realtor?s commission?
3) What?s the avg base salary range for a Realtor working for a well-known agency (apart from/ IN ADDITION to the commissions they get )? Or is commission the only income for realtor working for a real estate agency?
4) Is it unwise for Seller to allow his Realtor to also be the Buyer?s realtor (ie a ?:double agent? so to speak? If so, why? If not, why not?
?Milly, Newago, MI
A: Realtors can?t fix their commission. Each office has a different one. I suggest you interview a few different companies and compare what each can do.
Matt Laricy is a Realtor? with Americorp Real Estate in Chicago, IL.
A: Dear MI Seller,
I am a California Licenses Realtor, so things may be different in your state. In my area, it is customary to charge 6% for a standard residential sale. With lots and land, the commission is usually significantly higher, due to the nature of selling lots and land. It takes longer and more marketing dollars to advertise/market land and see it through the entire sales process. As a result commissions on land sales are often anywhere from 10%-20%.
Commissions are ALWAYS negotiable; that?s the law. Whether or not you will be able to negotiate a rate you like, is open. Just remember when negotiating commission fees, you often get what you pay for. For instance, if a Realtor is quick to let you negotiate a lower commission than he/she usually charges, then how good will that Realtor be at negotiating in general? You want a Realtor who can negotiate a good sale price and terms for you.
A good negotiator will explain in detail why he/she is worth the commission charged. Your Realtor should provide you with a list of the work to be performed, schedule of marketing and advertising, and length of time expected to get the property sold.
The quantity of land does not usually affect the commission.
Usually Realtors work on commission only; they do not earn a base salary. Additionally, say your Realtor charges you a 10% commission. He/she will have to split that 10% with the buyer?s agent. So that leaves your Realtor with 5% of your sale price. Then, your Realtor has to share his/her 5% with his office/broker, which is usually anywhere from 25%-40%. At the end of the transaction, your Realtor may end up with as little as 60% of 5% of the sale price. And Realtors pay for their own advertising and marketing, errors & omissions insurance, business license, etc.; their office does not customarily pay for any of those expenses.
Best practice is to not allow your agent to represent both the buyer and seller. However, I would allow the same company to represent both sides, meaning Realtor Bob from ABC Realty is your agent and Realtor Jane from the same company represents the buyer? that scenario is still called ?dual agency? because one COMPANY is representing both sides, even though two different Realtors are doing the work.
I personally NEVER represent both the buyer and seller. I focus solely on the needs of my seller and if a buyer comes my way wanting to buy your land, I help that buyer by referring him/her to a good Realtor; that way I?m not turning away a possible buyer and I?m remain focused on you.
Many agents prefer to ?double-end? a deal for the obvious reason of an increased commission. If you decide to allow your agent to represent the buyer too, then consider negotiating a commission that is something like this: ?15% commission to be split with buyer?s agent; 10% commission if Seller?s agent represents both sides?.
I hope you find this information helpful!
DeniseTheRealtor CA DRE Lic No 01481788
Denise Shur is a Realtor? with 1:1 Realty in San Jose, CA.
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