The standard 6% commission is no longer being considered the norm anymore. As house prices continue to rise, 6% seems to be a number that is definitely negotiable amongst realtors and home sellers. Their commission can easily be in the tens of thousands if they sell in the median house range.
However it’s not always such a good deal to get a discounted commission from a realtor. Some companies will accept the discounted commission but only post your house on their website and may give you advice on selling, but the open house and showing the home are left entirely up to the seller. So just know when you’re paying for a discounted commission, you may indeed get what you’re paying for. You may not get a full-service realtor.
However don’t feel like you’re stuck paying the 6% or getting shoddy service. Haggling the commission is always acceptable. Try it with the realtor and see what they would take, but don’t get greedy or you may end up with an agent who won’t work as hard for you.
The main reason for the discounted commission rates is the fact that there are so many agents now. The number of real estate agents has doubled in the last 5 years which is leaving them to compete for business, especially in a slow market. This is to the seller’s advantage that you may actually find a realtor who wants to do business with you and will lower their commissions.
Just be sure that you know what services you are getting when you’re choosing a realtor. They may not offer full-service and may even offer ‘do it yourself’ service when you read the bottom line. There are even extremely cheap packages that you can buy that just buy you a listing at Realtor.com which is run by the National Association of Realtors and you have to be a licensed realtor to list a site there. However this site will get your listing a lot of exposure, but you will be left alone to ‘seal the deal’ by yourself.
However due to competition, some discounters are giving away good values. There are certain companies out there that sell high-end market homes and will drop their commission to 2-3% and still offer full-service. Partially it’s due to the Internet and the availability to ‘shop around’ and find the best deals for the buyer and partially it’s due to the explosion in the amount of agents. But one thing you can be sure of, buyers have never had such bargaining power before.
Just remember you get what you pay for. If you have a lower priced to median priced house and you’re trying to get a lower commission rate, the realtor may not be as willing to give you the full service. If you have a house worth a higher value (for example $500,000), you may just have more bargaining power to get below the 6%.