Agents' commission

[Chromeboy007]

Hi,

Typically, how much are agents paid on a residential real estate transaction?

From what I hear, the buying and seller agent typically gets 2.5% each:

http://www.mississauga4sale.com/commission.htm

Can anyone verify this?

Also, for upscale homes a million dollars and up, I bet the seller has more power to negotiate the agent's commission. What is the rate typically?

Thanks

 

[Eldona]

We paid 1.5% to the listing agent and 2.5% to the selling agent, the last two times we sold. But we did not try to sell anything in 2009, and these were sure-thing resale condos.

 

[Chromeboy007]

Thanks Eldona,

If you can, what were the approximate asking price for these units?

Is it true that the higher the asking price is, the more clout the seller has when negotiating a commission rate with the listing agent?

 

[UrbanVigor]

This would be very interesting to hear from someone that knows... I would think so since a lower commission rate on a higher sale value can easily equate to a higher commission payment. At the end of the day, a commission rate is a standard guide to negotiating an agreed commission value.

 

[Eldona]

Today I asked a real estate lawyer, and she only says that "there are a lot of discount brokers out there who will list a property, almost always with reduced services, for less than the standard 2.5%. This does not affect the co-operating broker's 2.5%, however. Commissions are also often further negotiated on a deal where the parties are not far apart, but are deadlocked. One or both agents will then often reduce their commission in order to get the deal to work. That doesn't happen in this market as much."
Personally I doubt that the higher the asking price, the more clout the seller has, but I could be very wrong.
I get discounts from my regular real estate agent when the sale is hardly any work for her and we both know the Unit will sell in one day.
I think big houses and costly condos might take work to unload, on the other hand the cute, convenient little condos sell themselves - whether or not those Units deserve to be bought.
I could be wrong.

 

[Eug]

Big houses might take work to unload, but then again the payoff is much higher.

Small condos that sell themselves may not take much work, but then again the payoff is much lower.

I think either way there is room to negotiate, as I've seen several reports of homes sold with 4% commissions (1.5% and 2.5%). Personally I think a more reasonable amount with today's prices for what the work is really worth is more like 1% + 1%, but with the listing costs paid for by the seller, not the agent. Then again I'm a cheapskate. And that said, when I sold, I gave 5% (2.5 + 2.5), as that was the going rate for the agent I was with, and I was comfortable with him.

 

[bccl]

When I sold my condo, I paid 3.5% (2.5% to buyer's agent and 1% to seller's agent). I did not want to give 2.5% to buyer agent but if I did that, no buyer agent would bring his client to my condo.

Even though I paid 1% to seller's agent, he sent a photographer to my home and took pics and then used those pics to prepare colour feature sheets. When I sold another condo few years ago, I paid 1.5% to another seller's agent but the service was bad when I compared to the other seller agent.

 

[Chromeboy007]

When I sold my condo, I paid 3.5% (2.5% to buyer's agent and 1% to seller's agent). I did not want to give 2.5% to buyer agent but if I did that, no buyer agent would bring his client to my condo.

Even though I paid 1% to seller's agent, he sent a photographer to my home and took pics and then used those pics to prepare colour feature sheets. When I sold another condo few years ago, I paid 1.5% to another seller's agent but the service was bad when I compared to the other seller agent.

Hey bccl,

Would you be more inclined to choose an agent to be your selling agent if he or she were to use video (as well as still photography) to sell your condo/house?

The reason why I'm asking all these questions is I'm a pro videographer wanting to break into the real estate market. Those virtual tours have got to go! I have spoken to a few real estate agents around the topic face to face and I often get a sense that they are not telling me the truth. Popular end user opinion is always best!

 

[amitbuk]

The key thing is to interview the professional - you are hiring them to do work for you! Have you read testimonials? Are they full-time? Part-time? Have you seen their office? Met the broker? You should always do your due diligence before hiring anyone - it's common sense!

 

[bccl]

Hey bccl,

Would you be more inclined to choose an agent to be your selling agent if he or she were to use video (as well as still photography) to sell your condo/house?

The reason why I'm asking all these questions is I'm a pro videographer wanting to break into the real estate market. Those virtual tours have got to go! I have spoken to a few real estate agents around the topic face to face and I often get a sense that they are not telling me the truth. Popular end user opinion is always best!

I don't think I need video if I am selling condo. I prefer pictures rather than video as potential buyer can take the colour feature sheet. If that is a video, potential buyer needs to load the video from internet and it is very time consuming.

 

[Chromeboy007]

I don't think I need video if I am selling condo. I prefer pictures rather than video as potential buyer can take the colour feature sheet. If that is a video, potential buyer needs to load the video from internet and it is very time consuming.

You can watch a HD video from the internet almost without waiting.

You have to wait more than 3 seconds for this?

http://www.youtube.com/watch?v=H4FrkQdStTg