Who Pays The Real Estate Agent?
Now that you’ve learned how much does a real estate agent make, you’re wondering who pays the real estate agent?
Get ready for a non-answer. Or a super-answer. It’s a half-full/half-empty situation.
The thing is that both the home buyer and the home seller pay the real estate agents involved with the sale of a property but if you want to get too technical and literal, it’s the home seller.
Confusing? Ok, let’s go step by step of a sale and after we’ll comment and set things straight:
If Home Buyer Sam and his agent Steve close the deal with Seller Diane and her agent Roxanne, Home Buyer Sam pays up Home Seller Diane, who is obligated to give Agent Roxanne her real estate commission of 6%, that will be, then, split 50-50 with Agent Steve.
So, as you can see, the 6% commission is included in the payment done by the buyer and passed on by the seller. It’s a matter of point of view if you want to look at it as one specific party paying for that commission. And, of course, many greedy people see it this way: home buyers complain they could have spent less for the property if it wasn’t for the real estate commission and home sellers complain they could keep more of the money in their pockets if it wasn’t for the real estate commission.
But the truth is that they are both wrong. What is positively correct is the exact opposite: going about a house sale by way of a For Sale By Owner with no real estate agent involved will make you lose money. Whether you are the seller – by pricing it below (or even worse: above!) its true market value potential – or if you are the buyer – by not knowing how to detect and negotiate through the pitfalls of real estate and failing to avoid problems with paperwork and home inspection that will come to haunt you later and cost you lots of money.
Contact one of our local real estate agents right now so you don’t have to worry who pays for the real estate agent. Actually, you know what? We’re adding another answer to the question of who pays for the real estate agent! It’s not the seller or the buyer or the combination of the two… if you think about it, the agent actually pays for himself through the great work and return over your investment in hiring him! Do it!
Popular Real Estate Glossary Terms
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Same as term government rectangular survey: Way in which the U.S. government uses to subdivide public land. Land is designated as either a base line (East-West) or principal meridian line ...
Opinion of a judge having no direct legal or binding effect on the outcome of a pending judicial decision. An obiter dictum is considered to be an incidental judicial remark about some ...
(1) Judgment against a defendant who does not respond to the plaintiffs lawsuit or fails to appear in court at the hearing or trial date. (2) Judgment issued by the court against the ...
(1) Methods that involve discounting the future cash flows generated by an income property. These techniques are used primarily for valuation. (2) Methods of selecting and ranking ...
Room that is fit for living in. the building in which the room is located conforms with the building code and has a certificate of occupancy. Usable for all purposes, but does not include ...
Existing state of affairs with respect to the real estate market and conditions. ...
The concept of a release can define various meanings in the financial and real estate business. Typically, it establishes a discharge or literal escape from a loan borrower's economic ...
Voluntary giving up of a right of a lien, usually on a temporary basis. The waiver may be explicitly stated or implied. An example is when a lender waives its right of lien against ...
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