I totally stole this from ‘The Lighter Side of Real Estate’, a comical site for realtors to convene and share funnies. There are SO many seriously good articles on the site, and I so look forward to their silly memes and clips everyday. Even as a newer agent, there are so many I relate to. Although… my first year wasn’t like many.
It still seems surreal to me. It doesn’t seem like many- only 5 homes. But for many, that’s more than they do in an entire year. And for some, it’s a petty amount that they can close in one single month. (my business partner would be the latter- she is SUCH an excellent Realtor) I feel confident that I am off to a great start, and I am just pumped for what 2018 has in store. I just have to keep hustling, working hard and continuing on to educate myself on the newest trends, market stats and inventory that is available to me.
DID YOU KNOW: As a buyer, you pay me NOTHING. My fee to you, is free of charge. This is how it works….
A seller needs to sell their home. They have 2 options: Sell it themselves (FSBO- For Sale By Owner) or hire a Realtor. In Omaha, it is typical to charge between 5-7% for a Realtor to put the home on the market. And truthfully, you must know it is not that easy. (entirely different blog post- there is SO much a listing agent does, you’d get dizzy if I shared it here) However- the agent does NOT receive the entire 5-7%. They must share their percentage with the buyers agent, which is minimum 2.4% here. So… do the math… in some cases they are making just as much as the buyers agent, sometimes a bit more. If they find the buyer themselves- good for them! They earned themselves the entire 5-7% commission. (This is called Dual Agency- another topic, another day. Dizzy, remember?)
Let’s plug in some numbers. You want to put your home on the market for $250,000. You pick a Realtor, you have complete confidence in their skill. They arrange for staging, pictures, cleaning, lockboxes, showings, paperwork… this is the tip of the iceberg. You settle on 6% commission. You get what you asked for- because in this market it is ABSOLUTELY plausible, and if you’re in the right price range.. many times you will get OVER asking price! (we dub this market a ‘Seller’s Market’) The commission the agent earns is… $15,000. (250k X .06) But… another agent brought the buyer. So, you must share this split. You are now left with…. $9,000. (250k X .035) You likely have a split with your broker- some are 50/50, some 70/30, and some you may pay a monthly/yearly fee and collect the entire 100%. Depends. (THIS is why it is important to shop smart for your broker!)
I LOVE this article that I found on TLSORE. Check it out- and remember, these things are free of charge from a buyers stand point. And from a seller- sure, sometimes a pretty penny… but it just gets taken from the top of your earnings from the sale of your house. Is it worth it to pay a Realtor to handle the nitty gritty? Selling your house on your own can be incredibly difficult. I also know people who like and will continue to only list their homes themselves, however.. stats do show that people who list with an agent earn quite a bit more. (on average, anywhere between 5-10% more with a Realtor)
We are worth it. I am worth it. I shouldn’t speak for other agents, however… getting your license is not exactly a walk in the park. It doesn’t take a rocket scientist, because clearly… that I am not.. but it takes time, commitment, dedication and continuing motivation, education and persistence. We are not governed by our brokers; we work for ourselves. We are in the business because we believe in our skill enough to successfully aide in the buying and selling of real estate as a whole.
Enjoy the article- if there is something that catches your eye or you have a question about– you know where to reach me.