If you are getting ready to buy or sell a house, you are probably wondering how a real estate agent is paid and where your fees go. The Rieger Realty team has broken it down for you to give you an overview of how real estate commission works. These figures will vary between agents.
Commission figures: Typically, the real estate commission is 5-6% of the home’s selling price, split between the buying and selling agent. For example, If a real estate agent is selling a home, they will receive 2.5-3% of the selling price and the buying agent will receive the remainder.
Some agents will lower these fees, particularly if it is a dual agency, meaning the same realtor is assisting with the buying and selling of the house.
Who pays: Home buyers will pay closing costs (appraisal costs, inspection costs, insurance, Homeowner's Association dues, etc) whereas home sellers, will pay the commission fees to both the selling agent and the buyer’s agent when the house closes.
What happens if you don’t buy/sell: Agents are paid at the end of the process, so make sure that you have done your research beforehand. In theory, if you do not buy a home, you will not be charged for their time, but it also might be difficult to break a contract with an agent before moving to a new agent. Same goes for not selling your home.
For the most part, you will not be charged until the home is sold, but always make sure to read the fine print of the contract before signing it. The Rieger Realty family strives to provide the best service in every aspect of business. Give us a call today if you are looking to buy, sell or lease a home.