I am always a bit surprised when people I talk to have no idea how Real Estate Commissions work and the shock on their faces when they realize how much money is actually spent on them.  5-7% doesn’t seem like much, particularly when you don’t actually write a check for it.

The traditional way real estate commissions have been paid is quite genius.  I often wonder, who thought it up to begin with…….

fullsizerender-1Let us just tell the consumer “oh, it’s only 6%” that won’t sound like much.

We will wait and charge it to the sellers column at the closing table, after all of their worldly possession are boxed up in a truck.  They’ll never even really calculate what it’s costing him. That sounds like a good idea…….

Except, when you sit down and ACTUALLY calculate it, it’s not all that affordable, is it?  If you have been one of the unlucky souls, coming to the closing table with money, in order to sell your house, to someone else, you know this all too well.

Now, I am not saying real estate agents do not serve a purpose, they certainly do.  They do possess the knowledge of how to prepare your home for the current market. They know what it is really going to take to get your home sold in the current market for top dollar. They also know about contracts and processes that the average consumer does not.  Realtors® possess access to data in assisting with pricing homes that the average person does not have access too. So, back when there was no internet or it was not widely used, before the MLS system it was actually a pretty lengthy and costly process.  Thus, the development of the 5-7% commission rate. But that was then and this is now.  A lot has changed to make is a much simpler and frankly faster process.

Let’s take a moment and do that math on that.  If you home is worth $250,000 and you hire a Realtor® to sell it for at 6% you will pay $15,000 for that service.

That is a lot of money.

fullsizerenderHow much of the year did you go to work every day to make $15,000? 

Now, before you go hating on your Realtor® let me be clear, the listing brokerage will typically keep 1/2 of that fee, so $7,500.  The other $7,500 gets shared with the brokerage that represents the buyer. So now you are thinking….so my realtor® is getting $7,500, that is still a lot of money. You are right it is, but not so fast….most times the Realtor® is not getting that whole amount they have to split that with their brokerage.  A typical split between an agent and a brokerage is 70/30 so your real estate agent is getting $5250.  That could still be a lot of money…..how many hours do you work for $5,250?

Seller/ sellers agent / sellers broker / buyers broker / buyers agent / Buyer
$5,250             $2,250                $2,250                $5,250

It sure does seem like there are a lot of middle men standing in between the seller and the buyer.

Each one taking a bit of YOUR equity out of the deal.

What if you could reduce those middlemen?

What if you could take the sellers brokerage and agent commission portion down to as low as $595?

You would save $6905 on a $250,000 house!

What if your house was worth $550,000?  What if it was worth a million?

fullsizerenderYou owe yourself a visit to solidrealtygroup.com to see what Solid can do for you.  Be your neighborhood hero!

Share it with your friends, share it with your co-workers. Shoot, share it with your boss….if the folks in your life save 1000’s and 1000’s on real estate commission because of you…..I bet your birthday just got a lot better!