There was a time when there were few options other than to pay high commission rates to buyer’s agents when you wanted to buy a home. However, now things are beginning to change.
On May 13th, CBS News aired a feature on 60 Minutes discussing the state of the real estate market. During the episode, agent commission rates as well as buyers’ rebates/commission rebates were talked about.
The point of rebates is to put more money back in the pocket of the home buyer. The point of buyer’s rebates is that there is a lot that the buyers themselves can do during the home buying process - scheduling visits, searching for the right property online - that they do not necessarily need to have an agent’s assistance with.
If you are a buyer who is questioning commission rates, why not learn more about buyer’s rebates and the process of using a flat fee real estate broker to purchase a home?
Flat Fee Realty
Questioning commission rates? See how much you can save with a buyer’s rebate.
Internet Home Services Real Estate Blog
February 13, 2006 – 6:49 pm
Why are you paying 6%?
You save on airline fares. You can buy stocks for just $10. You book hotel rooms, buy books and trade junk from your attic on the Internet. So why are you still paying 6% to sell your home?
According to studies, U.S. home sellers pay about 1.5% more than home sellers in other parts of the industrialized world for the priviledge of having their homes listed by real estate brokers. A listing in the Realtor Multiple Listing Service (MLS) along with a bundle of services from pricing assistance and marketing to contract negotiation and transaction management can take a huge slice out of the home equity pie.
The Internet has brought about a plethora of new business models aimed at reducing the cost to consumers of selling a home. Choosing a discount real estate model is a simple matter of searching the web. Try this experiment: Google "flat fee mls + (your city’s name) " or "discount realtor + (your city’s name)" and you’ll now find hundreds of entries for real estate companies competing for your business by offering lower fees and an "unbundling" of the traditional real estate brokerage offering.
Once a fringe element of the real estate industry, discount real estate has become a part of the mainstream. Discount realtors, flat fee brokers and limited service companies have sprung up all over the country in response to consumers’ clamoring for alternatives to high real estate commissions. The effects have been noticeable. The average commission rate in the U.S. has fallen to about 5%.
So, what are you waiting for? Find a reputable company offering "a la carte" services and you’re on your way to saving thousands of dollars in real estate commissions. That could come in handy in your new home.
October 28, 2005 – 7:27 pm
Two out of three home sellers hire the first agent they contact.
Many homesellers don’t realize that real estate commissions are negotiable. The fact that real estate commissions seem to be fairly standard across the country leads many to believe that there’s only one commission rate.
Nationally, the average commission rate is about 5.2% according to Real Trends, a publishing and communications company providing news, research and information-based services to the residential real estate industry. But a recent poll of home sellers showed that most people anticipate paying a commission of 6% for a real estate agent to list and sell their home.
As new Internet business models enter the real estate arena, the downward pressure on real estate commissions gives home sellers more room to negotiate when it comes to hiring a real estate broker. Knowing what you can hope to gain by doing a little reseach before meeting with a real estate agent could save you a lot.
For a primer on "How to Negotiate Real Estate Commission Rates" see the new online report at Insight-Realty.com.
See Also
