If you’re working with a real estate agent to buy a house, you may be wondering if you’re required to pay them for their services. The answer is that there is no set rule – it depends on the agreement you have with your agent.
If you’re hyper concerned or curious about agent commissions though, we have some insights down below to help you ask the right questions and get the right answers.
Why Work With a Real Estate Agent?
In most cases, it is beneficial to work with a real estate agent during the home buying process. They can help you navigate the process, find the best deals, and avoid costly mistakes. But if you’re not comfortable with the idea of paying a commission, be sure to talk to your agent about other arrangements.
You shouldn’t just hire any old realtor though. If you’re going to pay a realtor to help you find a home, then you need someone professional, knowledgeable, and trustworthy. If you’re in the Las Vegas area, we recommend checking out Blue Diamond Realty. They have decades of experience in the local Las Vegas real estate market. They specialize in helping buyers navigate all of the available real estate listings to find their perfect home for the best purchase price, and they would be delighted to work with you. Contact them today to learn more or to get matched with an experienced realtor.
The Most Common Commission Scenario
Typically, buyers don’t pay real estate agents directly during the home buying process. Instead, the seller of the home pays a commission to the listing agent, who then splits it with the buyer’s agent. This arrangement is called a buyer’s broker agreement. When you hire a real estate agent, you can specify that you only want to look at homes that have this sort of arrangement set up in the listing. Oftentimes, this can prevent you from paying any realtor fees. The MLS, or Multiple Listing Service, will tell realtors what the commission offering is.
The commission doesn’t come out of the closing costs, real estate taxes, mortgage payment, or down payment. It is a lump sum given to the realtor at the time of closing and it is calculated as a percentage of the total price.
Individuals with real estate licenses have a strict code of ethics they must adhere to. Realtors who are part of the Greater Las Vegas Association of Realtors aren’t allowed to fix the commission price in their market, but there tends to be a market average for commission payouts, usually expressed in a percentage. Ask several realtors what the average market commission percentage rate is in your area. Usually, it’s somewhere around 2.5%-3% for a buyer’s agent and 3%-3.5% for a seller’s agent. Again, this might vary by area, so do a little online research and ask several brokers for their opinion.
However, some real estate agents may charge a fee for their services regardless of who pays the commission. It’s important to ask about this upfront so there are no surprises later on.
Don’t Be Afraid to Ask
Sometimes, and this is unethical, a buyer’s agent will avoid showing their clients homes in Las Vegas neighborhoods where the listing agents are offering a lower percentage to the buyer’s agent for bringing a buyer. Whenever you look at a home, don’t be afraid to ask what the commission percentage is. You can ask how much your realtor is getting paid. It’s not illegal or taboo to do that because they have a lot of power, and you require transparency. Now, realtors are bound by contractual agreement to have your best interests in mind, not theirs, but it doesn’t hurt to ask so they know you are an informed buyer.
If you’re not working with a realtor, you may be able to save money by negotiating a commission with the seller’s agent. Just be sure to have an agreement in writing so there are no misunderstandings.
Final Thoughts
Purchasing a home is a huge investment, and working with a professional realtor can help ensure that you find the best deal and avoid making any costly mistakes. The buyer is not usually required to pay their realtor when buying a house, but paying up is definitely not out of the question.
It is typical for the seller to pay the commission as a percentage of the home price, which is then split between the buyer’s and seller’s agents. Home buyers can typically avoid paying realtor fees by working only with listings that have a buyer’s broker agreement in place, but be sure to ask about other arrangements if you’re not comfortable with this arrangement. Finally, don’t be afraid to ask about your realtor’s commissions upfront – it’s important to be an informed buyer!
If you’re looking for an experienced, knowledgeable, trustworthy realtor to help you weed through all of the Las Vegas neighborhoods in your local real estate market and find your perfect home, contact Blue Diamond Realty today. Their office will match you with the perfect agent who can help you find your dream home!
