If you’re buying or selling a house, you’ll likely use a real estate agent to guide the way. But how much will that cost?
After all, you’ve already got hundreds of thousands on the line. Will an agent rack up that bill even higher?
The truth is it’s complicated. Unlike other services, you usually won’t pay your agent directly. Instead, it will come out of the sale proceeds (if you’re selling the house) or from elsewhere in the transaction (if you’re buying).
Let’s break down what this looks like and how much you can expect to pay for your agent:
How much real estate agents cost for sellers
As a home seller, you’ll hire what’s called a listing agent — a real estate agent who will list, market, and sell your home.
Listing agents typically command a fee of 5 to 6%, meaning 5 to 6% of the total sale price. So, if your home were to sell for $300,000, your listing agent would get $15,000 to $18,000 out of your profits.
How much real estate agents cost for buyers
Here’s where it gets a little nuanced. When you’re buying a home, you don’t pay your agent at all. Buyer’s agents are actually paid by the listing agent in what’s called a commission split.
Once the listing agent takes their cut, they give a portion of it to the buyer’s agent — the professional who brought the buyer to the sale. In most cases, this amounts to anywhere from 2.5 to 3% of the sale price.
Alternative and discount real estate agents
To be clear, the above payment structures are just for the traditional types of Realtors. Some agents and brokerages operate on a flat-fee basis instead, and that fee may come up to less than the percentages mentioned earlier.
Others call themselves discount agents, and they cost even less (though they usually come with stripped-down services as well).
Always shop around for your real estate agent, and be sure to read the fine print on any contract. How much will you owe them, and how will it be paid? What services will you get in exchange for the fee? And most importantly, what are your options if they’re unable to sell your house or help you find one to purchase? How long are you locked into their services? These are all things to consider before signing on that dotted line.
Get help finding an agent
Your loan officer can be a great resource if you’re not sure which agent to choose. They should have a deep network of local agents you can pull from — ones with proven experience and knowledge in your market.
Need help connecting with the right agent in your area? Get in touch with Premier Nationwide Lending today.
Premier Nationwide Lending is an Equal Housing Opportunity lender. Sponsored by NTFN, Inc. 700 State Highway 121 Bypass, Suite 100, Lewisville, TX 75067 NTFN NMLS 75333.