Though some people take the FSBO route, most home sellers utilize a real estate agent – and for good reasons. Agents know the local market well, are experienced negotiators and make the whole selling process much easier. But they come with a price – real estate commissions. And, really, contrary to what some Westfield, Cranford, Clark, Scotch Plains, Fanwood and Mountainside Areas home sellers think, what you get for your money is well worth it. So let’s see if we can shed some light on real estate commissions and what they cover for home sellers in Westfield, Cranford, Clark, Scotch Plains, Fanwood and Mountainside Areas.
Overview of Real Estate Commissions
When a Westfield, Cranford, Clark, Scotch Plains, Fanwood and Mountainside Areas home seller signs a listing agreement with a real estate agent, she agrees to pay the commission, usually around 6% of the sale price. This commission is then usually split about evenly between the seller’s agent and the buyer’s agent. Each agent in turn typically pays the brokerage a portion of their commission.
When selling your home the agent doesn’t actually receive the entire commission. If a home sells for $500,000 and the total real estate commission is 6%. Assuming an equal split of commission, each agent (seller’s and buyer’s) will get 3%, half of the total 6%. And then each agent will hand over to the brokerage about half of that 3%, each thus winding up with about 1.5% of the original 6% – or around $7,500.
What this means for you as a seller is that your agent is getting far less than 6%, and considering all the work your agent has to put in to earn that 1.5%, you’re really getting a bargain. To find out more, contact a Westfield, Cranford, Clark, Scotch Plains, Fanwood and Mountainside Areas agent at 917-608-7277.
Who Pays Real Estate Commissions?
Home seller have to pay the total real estate commissions and seems that their agent is actually getting only a small portion of what they have to pay. But in reality, this isn’t the case. The buyer’s portion of the commissions is usually included in the price of the home, so the buyer winds up paying her portion of the commissions indirectly.
“Let’s say, for example, that a buyer and seller (each with a real estate agent) agree to a deal on a home for $200,000. Assuming the real estate commission is 5%, the fee would be $10,000 ($200,000 * 0.05).The fee comes out of the cost of the home – it is not added to the sale price. So, while the buyer would pay $200,000, the seller would receive $190,000 from the sale.” In many sales, the seller is considering the proceeds needed and what they will accept is impacted by commision.
Why Real Estate Commissions Are Worth It
The common complaint about real estate commissions is that they are too high and that agents don’t really provide services deserving of the cost. So let’s see if that’s really the case.
At Steve Christian Homes we do a lot more than take a few photos, determine a listing price, and put the home on the market. We offer staging consultations, professional photos, virtual tours, and floor plans. Plus our extensive marketing program includes traditional print media and digital media including advertising on Facebook, Instagram, and more.
“For the seller’s agent, this can add up to many hours spent marketing the home, holding open houses, taking phone calls, and staying abreast of other listings and sales in the neighborhood. That agent will also bear the long-term cost of keeping the house on the market, including signage and advertising fees. When you consider all of this hiring the right professional is worth your time and money.
The Value of a Westfield, Cranford, Clark, Scotch Plains, Fanwood and Mountainside Areas Agent
So even though an agent typically does a lot for a long time to earn her money, it still costs you as a seller. But keep in mind that your agent’s services and skills are vital to the whole process, and they are many and varied, for example:
- Running comps and determining sale price
- Overseeing staging and photography
- Managing virtual tours
- Marketing for extended periods (leveraging social media, placing ads, finding buyers, cold calling)
- Conducting negotiations
- Managing paperwork
- Being present for showings and hosting open houses
- Scheduling appointments for appraisers, inspectors, contractors, and surveyors
- Coordinating closings
We are always be looking out for your best interests, striving to get you top dollar for your home. We represent your interests make the process easier for sellers.
How to Find a Good Agent
You do need a good Westfield, Cranford, Clark, Scotch Plains, Fanwood and Mountainside Areas agent to make sure you get your money’s worth. You can conduct extensive research and spend hours getting recommendations and reading reviews to find the right agent for you. Or you can do it the easy way by contacting Steve Christian Homes today. You can see more about how we sell homes by requesting our Seller’s Guide to Success or if you have concerns about real estate commissions, contact us today at 917-608-7277.