Jan. 31, 2007 - Many and Varied Fees
One thing I learned this year is that there are many different types of ways to approach a real estate purchase or sale, and many different fee arrangements to go with.
The lowest fee that I charged was $3,000 for house that sold for over a million dollars. The buyer had happened upon the house which was not for sale. The seller only needed to be out of the room so that the buyer could formulate their offer with a disinterested 3rd party. I acted as a "transaction broker" representing neither part, and charged a $3,000 flat fee.
Oh, no, I forgot. The lowest price I charged was zero. I represented the seller and the buyer happened in just as I was receiving an offer from another agent. He was shy and thought that since I had one offer, he should "wait and see what happens" . He and his girlfriend lived the house and I threw in the 3% buyer agent fee so that they could get it. He thanked me so much from beginning to end that I had to keep reminding him that he wasn't my client :) Very nice fellow. Worked at Boeing. Needed no help except for writing the offer.
I charged the seller less than 2% total for both sides of the transaction. They had the place pretty much set up when I got there, so I only had to move a few things around and bring in one truck load of accessories. They were trying to sell it on their own with MLS4U before I came and had lost 6 weeks in the process. They really needed to get to their new jobs out of state, so we just sold it in 4 days by giving the buyer the 3% buyer agent fee. Because they were moving to such an expensive place, I priced my services in between their MLS ONLY option and the going rate.
All in all it was a quick and easy sale for them once they gave up trying to do it all on their own. The did have to pay the MLS ONLY fee, as those types of services have to be paid for whether they are successful or not. But in the end, they ended paying even less for full service than the would have if they were successful at the MLS only option.
The highest fee I charged was a full 3% on a property that needed ten days of staging to get it ready for market. It sold rally fast but was in the $200,000 range, and there is always more room to negotiate when the sale price is highest.
So for the most part, Under $400,000 usually involves some cash toward closing if the property sells quickly or the buyer finds a home quickly and is well qualified for financing.
People who are buying at a price of $800,000 or more, usually pay 1% to 2%, depending on the difficulty involved in finding their new home. And those who are both buying and selling can usually save 1% off their purchase and another 1% of the sale of their home. 3% being the guildeline from which to negotiate.
And always, if the seller is offering an agent bonus...that bonus goes to the buyer.
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