Real Estate: Dealing with Agents/real estate agents


Real estate agents make a commission.  I live near
Minneapolis and am thinking of shopping around for a lower commission.   (6% of $200,0000 is $12,000.)

     How would I go about finding a lower rate.?
Do you think the rate is negotiable  when I get ready to buy?

 Any suggestions?

Thanks   Dick

To answer your question I think I should first review how commissions are established.
Commissions are always open to negotiation.  Although a broker may have a commission rate that they consider standard, there is no rate set by law.  I know many brokers who will not negotiate their commission - you either accept what they ask for or they won't work for you.  I'm the opposite, I adapt the commission rate to the type and amount of work I'm expecting to do.

99% of the time, commissions are established between the seller and the seller's broker ("listing agent") when the property is put on the market.  Typically, the listing agent tells the seller he will sell the property for X%.  That X%, let's say 6%, is then split between the seller's agent ("listing agent") and the buyer's agent ("selling agent") with each receiving 3% when the property closes escrow.  Therefore, all commissions are paid by the seller, even though we know that the seller is using money that comes from the buyer to pay for everything.

On rare occasions, a buyer might ask his agent to take a smaller commission as a way to bring the purchase price down.  The commission reduction would be described in the buyer's offer so that the seller would understand that he still pockets the same net amount from the sale.  For example, if I'm working with an investor who will buy several properties using me as his broker throughout the year, I might offer a 25% commission discount on each sale.  If sellers are offering a 3% commission, I'll agree to take 2.25%.  The remaining 0.75% can be used as a price discount by the buyer.

Can a buyer reduce commissions paid to both his broker and the seller's broker?  Of course, anything's possible.  However, when a seller lists his property with his broker he signs a contract to pay his broker X%.  The seller's broker doesn't have to accept a lower commission, he's already guaranteed his percentage by the listing contract.  However, if the market is very slow and there are few buyers for the listing, the broker may consider a reduction if there are no other offers.

I hope this information helps.

Real Estate: Dealing with Agents

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John A. Souerbry


I can answer questions pertaining to: - How to find an agent that fits your needs - How to compensate your agent (commissions, incentives, flat fees, and more) - How to communicate with your agent before and during your transaction - How to initiate dispute resolution with an agent I cannot answer questions pertaining to: - Potential litigation or other legal matters


I am a licensed California real estate broker (CalBRE 01370983) specializing in residential brokerage, property management, and estate services. I have been licensed since 2003 and am currently working as an independent broker in the San Francisco Bay area.

Bay East Association of REALTORS(R) Silicon Valley Association of REALTORS(R) California Association of REALTORS(R) National Association of REALTORS(R)

In addition to my own web site, my blogs, articles and responses to consumer questions appear online at,, and other real estate forums. My answers also appear in several categories relating to real estate on

BS, Business Administration MBA, Globa Management

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My clients are: - Consumers searching for a primary residence or vacation home - Investors buying and/or managing residential income property - Estates in probate requiring temporary management and property sales support

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