One of the most rewarding aspects of buying a home may also be one of the best kept secrets of the real estate industry. Real estate rebates and new home rebates, also known as real estate commissions are incentives given to buyers of a house by the real estate agent as a thank you for giving them your business. So you may be wondering how to negotiate real estate commissions, the following information will ensure that you get your piece of the rebate pie.
What is the Real Estate Commission?
The real estate commission works like this, the homeowner puts the house up for sale and agrees to pay their realtor a commission when the house sells. The money for selling the house is the pay the realtor earns, and they take a small piece of their own commission and offer potential buyers a cash incentive to work together. If they buy the house, at closing they are given the cash that was agreed upon.
What is the Average Real Estate Rebate?
While the actual numbers vary from realtor to realtor, a good rule of thumb to remember is this. If a house sells for $300,000, the realtor will usually give the buyer of the house a check for $3,000 at closing, or generally 1%. This number does vary depending on the unique circumstances of the sale, especially if the realtor makes less or more than the standard commission.
How Do I Negotiate a Real Estate Commission?
Negotiating the real estate rebate is simple because the realtor wants your business, and the fact you are asking in advance puts them in a position they have to do what it takes to get you as a client. The bigger house you are buying, the more you could negotiate because the realtor makes more money. If you feel the cash percentage they are offering is low, consider some other forms of payment. many realtors have inroads with inspectors, painters, contractors, hardware stores, and big box home centers.
Consider getting your commission is the form of a store of your choice gift certificate, payment towards closing-costs, or free ancillary services like home inspections or possibly moving services.
So now you understand how to negotiate real estate commissions. You should have plenty of real estate agents knocking down your door if you are looking to buy a house, and now you know how to sweeten the deal in your favor. Remember, it doesn’t hurt to ask about a real estate rebate.
