If you decide to work with a realtor to sell your California home, you will likely be responsible for paying the commission. While it is possible to discuss the percentage and find ways to reduce the fee, typically, the commission is deducted from the sale proceeds. Here is a breakdown of the costs associated with using a realtor to sell your home in California.
What is the commission rate for buyer’s agents in California?
In California, buyers’ agents typically charge a commission ranging from 2% to 3% of the purchase price. If you’re thinking of hiring your own agent, be prepared to pay around 4-6% of the home’s price. The commission fee varies based on negotiations and is typically higher for pricier properties. If the home’s value exceeds $1,000,000, you may need to pay around $60,000 or more in realtor commissions, depending on the number of agents involved. For a home priced at $400,000, broker fees typically range from $15,000 to $24,000.
How to Lower Broker Fees in California?
Contact the Brokerage
Many agents typically work within an established brokerage and follow a predetermined commission system. When faced with this situation, it could be challenging to negotiate directly with the agent since their ability to adjust the fee might be limited. Alternatively, you could reach out to their company and attempt to discuss matters with the broker directly. You might have to provide them with an incentive to agree to a reduced fee. If you have multiple properties you want to sell, you might be able to negotiate a lower commission with the broker by offering them future business.
Utilize the agent for particular services only
Some agents may reduce the commission if you require their services for specific tasks only. For example, if you’re able to promote the property and engage with buyers independently but require help with negotiations and closing, a professional might agree to do so for a reduced commission. Some agents may not be receptive to this arrangement, and it will demand additional effort from you. It’s an uncomplicated method to reduce the fee if you require additional cash.
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Negotiate with the Buyer
While negotiating with your own agent can be straightforward, handling the buyer’s agent can be more difficult. So, you’ll need to negotiate with the buyer to reduce their fee. It is uncommon for a purchaser to cover the costs of their own agent directly. If you have some leverage in the deal, you might be able to negotiate a solution. For example, if a buyer is interested in purchasing your home and you have multiple offers, you could negotiate a higher price or ask them to cover some of your closing costs to offset the commission.
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