Just as your doctor's expertise is priceless when a problem develops on the operating table and your attorney's experience is paramount after a surprise witness is introduced in the courtroom, the true value of the Realtor® you select may not be appreciated until after you have secured a buyer for your home and a problem develops on the way to closing.
Hurst Home Realty has the experience and expertise to handle even the most complicated situations that can develop while you are under contract. At times like this, your Realtor® is worth every penny that you pay them. After all, do you negotiate your fee with the other professionals in your life? Such as your doctor, attorney or CPA.
Most people think real estate agents earn an outrageous amount of money for the work they do. If you would like to see the list of over 100 plus things an agent does to get your house sold, contact us and then you will understand that buying or selling a house is a very complex process.
Let’s look at where the commission goes on the sale of a house.
A hypothetical commission of 6.0% (remember that commissions are negotiable between the listing broker and the seller) the agent/broker who represents the buyer usually gets half (3.0%), leaving the listing agent with 3.0% of the selling price.
Listing Agent Buyer's Agent
Of the 3.0% left to the listing agent, his/her broker usually gets around 1/3 (1%) for rent, utilities, insurance and other fees leaving the listing agent with 2.0%.
| Listing Agent Listing Agents Broker |
Of the 2.0% left to the listing agent, there are real estate expenses that must be paid to earn that income. Remember, all the costs to sell your home are usually paid from the commission earned. The listing agent is "out-of-pocket" for these costs until the transaction is closed and in many cases, the agent does not re-coup those costs! These costs take about 1/3 of the commission leaving the agent with only 1.0% to pay for their personal living expenses.
Listing Agents Gross Commission...Then...TAXES!
Of the 1.0% left more than half goes to taxes (35.0% federal + 10.0% state (where applicable) + 15.3% self-employment tax) leaving most agents with less than 0.5% of the sales price of a house to pay personal living expenses such as food, clothing, housing and education for children.
Real Estate expenses include, but are not limited to the following; automobile, gasoline, auto insurance, professional board fees, MLS fees, advertising, signage, lock boxes, forms, equipment, internet services, liability insurance, repairs, postage, printing, copying, referral fees to other agents, mobile phone, business phone and fax lines, entertainment and more.