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Are Realtors commissions rising in your area?

I am curious to hear what real estate commissions are doing in your area through this current real estate roller coaster. Here in Sarasota, Florida the average real estate commission is on the rise.

When I started selling real estate in 2000 I remember a good mix of 7% and 6% commissions with probably the majority of listings at 7%. Back in 2000 you could purchase a nice starter home for $90,000. It seemed to stay this way from 2000-2003.

Like most areas from 2003 to 2005 we took off. Our prices went through the roof. We, of course, are paying for this now. During those boom years commissions started to dip below 6%. We saw discount brokers pop up everywhere. The market was so good that Realtors had a hard time justifying more than 6% because they were not spending much on advertising and the time it took to sell something was very short. Fewer sellers were willing to pay 6% and more and more Realtors were willing to take them at less than 6% because of the lower costs.

Now, that the market is much slower real estate commissions are rising again. I am seeing a lot of 7% and even a few 8% and 9% commissions. People are trying to separate their homes from the pack by offering a higher commission rate. Realtors can justify the higher rates because the time it takes to sell a property is much longer , more work is involved and more advertising dollars are being spent to market a property.

What are you seeing in your town?

Posted by Marc Rasmussen on 04/30/2008 06:39 AM

Comments (7)

real estate commissions, property, sarasota, florida, fl, realtor, real estate, home, houses, brokerage

7 Comments on Are Realtors commissions rising in your area?

Interesting post. here they are the same or lower. ^ percent is becoming the norm not 7. Lowering prices are prompting sellers to ask us to take less.

04/30/2008 06:42 AM

by Charlie Ragonesi Big Canoe Realestate Jasper,Ellijay,Ball Ground,Benttree (All Mountain Realty)

We are seeing a higher commission rate. Another one we see a lot now is an added bonus paid to the Realtor who rings theuyer. Sellers are getting creative.

04/30/2008 06:44 AM

by Gary McAdams (GMAC Schwartz Property Sales)

We've seen some higher commission rates and the added incentives/bonuses are definitely on the rise! However, lately I've noticed a number of new brokerages cropping up with listings that state the buyer must pay the selling agent's commission! It's amazing what crops up during challenging times.

04/30/2008 06:49 AM

by Bonnie Tegge (Prudential Decker Realty)

We are seeing a higher percentage rate on the buyers side now. I've seen one transaction where the buyers agent got 2% and the listing agent got 5%, but generally speaking we're seeing more 3 and 4% commissions offered to buyers now.

04/30/2008 06:50 AM

by June Piper-Brandon, CRIS, ePro, Broker (Advance Realty Anne Arundel Inc.)

I have found (after I made the mistake about posting about commissions) that tihs subject needs to be discussed carefully. Consider Anti-Trust.

best regards, Charles

04/30/2008 07:19 AM

by Charles McDonald / Your Trusted Broker for Charlottesville Real Estate (RE/MAX Assured Properties)

Our commissions are on the rise. My team and I are walking away if they don't want to pay. We are working harder, listings are taking longer to sell and less listings are selling.

04/30/2008 07:39 AM

by Julie Anne - Barrington/Deer Park, IL RE Agent (Keller Williams)

Hi Charles,

Thanks for the warning. However, I don't think we are colluding. Just a discussion on overall trends in commissions. Brokers can charge whatever commission they want. The market establishes our commissions. If you charge too little you can't stay in business. Charge too much and the customers will not use your services.

04/30/2008 07:45 AM

by Marc Rasmussen (SKY Sotheby's International Realty)

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