Effective marketing, professional advice, and negotiation are all factors in finding the home of your dreams. That is, unless you want to save on real estate agent fees and handle the entire transaction on your own.
There’s no doubt that hiring a realtor can be beneficial, but a question that many first-time buyers often have is, “Who pays real estate agent fees?”
Since not all brokers are paid the same, the answer is dependent upon the type of realtor you choose.
Not quite sure how to decide? We’ve got all the info necessary to make a smart decision.
Home Sellers
When you buy a home, the real estate agent representing you as the buyer usually doesn’t charge a fee. The agent’s commission—the fee charged for his or her services—is generally paid by the seller of the home. In some cases, the buyer and seller may agree to split the real estate agent’s commission.
So, if you would like to know more on how to zero out fees or closing costs, check the homepage here.
Home Buyers
When you buy a home, the real estate agent representing you as the buyer usually doesn’t charge a fee. The agent’s commission—the fee charged for his or her services—is generally paid by the seller of the home. In some cases, the buyer and seller may agree to split the real estate agent’s commission.
Marketing Fees
A real estate agent’s marketing fee is a commission that is paid to the agent for their services in marketing a property. The fee is typically a percentage of the final sale price of the property and is paid by the seller at the close of the sale.
Marketing fees can vary greatly depending on the agent and the market conditions but are typically around 5%- 6% of the sale price.
Commission Fees
As a general rule, the party who stands to benefit most from the sale of a property pays the real estate agent fees. In most cases, this is the seller. The realtor commission fee is typically a percentage of the final sales price and is paid at closing.
The typical commission fee is 6%, but this can vary depending on the type of property, the location, and the agent. Buyers usually don’t pay commission fees, but there are some instances where they may be responsible for a portion of the fee.
For example, when a buyer’s agent represents their buyer, the seller may agree to pay a reduced commission fee and the buyer’s agent will usually charge their client a fee for their services.
Administrative Fees
In some cases, buyer and seller may split the administrative fees that are generally paid by the property owner. Real estate agents receive a real estate commission from the sale of the property, which is then used to cover their administrative fees. The agent may also charge a flat fee for real estate services.
Understanding Who Pays Real Estate Agent Fees
Now we know who pays real estate agent fees. We learned that the home seller pays the real estate agent fees. However, there are situations when the buyer may be responsible for paying the fees.
It’s important to discuss the fees like commission fees, marketing fees, and administrative fees with your real estate agent upfront so there are no surprises.
Check out our other blog posts for more tips and advice for buying and selling real estate.
