Did you ever have a question you wanted to ask a real estate professional and were afraid or embarrassed to do so? Or maybe you did ask and received a glossy response that didn’t really answer your question. We try to provide candid answers to questions folks have brought to our attention.
Wow, you charge 6%? You must be really rich!
Ok, so I have to admit we've never been asked this exact question, but the general sentiment has been expressed by those more subtle than I. And while — like most professionals — we are well-compensated for the work we do, we thought a description of the commission breakdown might be helpful.
There is no standard for the commission amount charged by real estate brokerages to sell your home. In fact, that would be price fixing and therefore illegal! Keller Williams Realty Boise is a full-service agency and we charge 6, 7, and even 8% to list properties, depending on the level of service requested by our clients.
However, we'll focus on 6% here and talk about how this money is divided between the various parties in a real estate transaction. Let's say you want to sell your house and you want us to be your listing/seller's team. In this scenario, we charge you 6% of the final sales price of your home. We then offer 3% to the cooperating agent — that is, the selling/buyer's agent. That leaves 3%, of which we pay to Keller Williams Realty over 1% to cover the costs they incur to have us as agents. That leaves less than 2% to cover all the costs of marketing your home — photographs, measurements, advertising,
open houses, signage — as well as taxes, insurance, administrative and office costs, and other business-related expenses. And of course we always hope for a little profit. As you can see, there are a lot of ways this pie gets cut!
Now, why would a seller want to pay 7 or 8% or even higher to a listing agency? Remember that percentage that goes to the selling/buyer's agent? What if out of the 25 homes available in your price range, you were the only one paying 4 or 5% to the cooperating broker? This is definitely a way to increase the traffic to your home. If there are a lot of similar houses and you want agents to notice yours, it never hurts to entice them with an additional percent or two of commission.
Or perhaps you have work that needs to be done to your home before you sell it and you don’t have the time, money, or desire to do that work yourself. We can coordinate and, in some cases, pay for work to be done up front to help you net a higher amount at the closing table!
Talk to us about which commission model works best for you and your situation!
Wow, you charge 6%? You must be really rich!
Ok, so I have to admit we've never been asked this exact question, but the general sentiment has been expressed by those more subtle than I. And while — like most professionals — we are well-compensated for the work we do, we thought a description of the commission breakdown might be helpful.
There is no standard for the commission amount charged by real estate brokerages to sell your home. In fact, that would be price fixing and therefore illegal! Keller Williams Realty Boise is a full-service agency and we charge 6, 7, and even 8% to list properties, depending on the level of service requested by our clients.
However, we'll focus on 6% here and talk about how this money is divided between the various parties in a real estate transaction. Let's say you want to sell your house and you want us to be your listing/seller's team. In this scenario, we charge you 6% of the final sales price of your home. We then offer 3% to the cooperating agent — that is, the selling/buyer's agent. That leaves 3%, of which we pay to Keller Williams Realty over 1% to cover the costs they incur to have us as agents. That leaves less than 2% to cover all the costs of marketing your home — photographs, measurements, advertising,
open houses, signage — as well as taxes, insurance, administrative and office costs, and other business-related expenses. And of course we always hope for a little profit. As you can see, there are a lot of ways this pie gets cut!Now, why would a seller want to pay 7 or 8% or even higher to a listing agency? Remember that percentage that goes to the selling/buyer's agent? What if out of the 25 homes available in your price range, you were the only one paying 4 or 5% to the cooperating broker? This is definitely a way to increase the traffic to your home. If there are a lot of similar houses and you want agents to notice yours, it never hurts to entice them with an additional percent or two of commission.
Or perhaps you have work that needs to be done to your home before you sell it and you don’t have the time, money, or desire to do that work yourself. We can coordinate and, in some cases, pay for work to be done up front to help you net a higher amount at the closing table!
Talk to us about which commission model works best for you and your situation!
Knowledge Is Power
