Real Estate Commissions & Real Estate Service Charges
Real Estate commissions are service charges that a property agent or broker charge for assisting you in buying, selling or renting a property, and that’s the main source of their income. Normally, a real estate agent will talk of these commission rates as a fixed percentage of the whole amount. In reality, these commission rates are not fixed and you can (in fact you should) negotiate and reach a deal before you finally hire an agent. To know what the average commission rate is in the market, you must consult a number of property agents and compare their services because at times real estate agents refuse to offer some specific services, when they are working on a reduced commission rate. Therefore, when you’re fixing the commission, you should ask the agent to provide you with a list of services that you can expect to get in this fee.
Do you really need a real estate agent?
Even before you go out searching for a property agent, make sure you really need one. For example, if you are hiring them solely for property search or you want them to show you available homes for sale or rent, you can easily do it yourself, as a number of websites now offer free property listings for almost all cities in the world. You can just search for the property with your required specification and contact the property owner directly. Similarly, if you are looking for an agent to sell your property, you can try doing it yourself by placing an ad in those property portals. That doesn’t imply that property agents are of no use, it’s just that you don’t always need to hire a full-service agent all the time.
Normally real estate agents ask for a specific percentage as their commission; however there are companies who demand a flat rate. You can make a choice between both of these options if you’ve got a clear idea of the amount that will be involved. Do not make huge upfront payments or you’ll be stuck with that agent for a long time even if he/she fails to deliver, and always check for the property license issued by the concerned authorities before making any sort of payment. The situation of the market also affects the rate of commission, if the market is slow then you may get a property agent at lower commission rates, if there are lots of transactions taking place, you may find it hard to hire an experienced real estate agent at low rates.
