Many individuals selling their homes face the difficult decision of whether or not to hire a real estate broker in order to find a buyer. In order to make this decision intelligently , it is important to understand what the broker does and what the broker will charge for those services.
A real estate broker is responsible for finding a buyer that is ready, willing and able to purchase the home on terms and conditions acceptable to the seller. The broker is the seller’s agent in the transaction and will help the seller determine the asking price of the home, suggest how to market the home, advertise the home, and show the home to prospective buyers. The broker has sales experience, knowledge of the local real estate market, and the time to dedicate to selling the home. The broker can also “share” the listing with other brokers, thus increasing the exposure to prospective purchasers. This can expedite the sales process, reduce the time and energy that the seller would have to dedicate, and increase the likelihood of finding a buyer.
On the other hand, brokers earn substantial commissions. Typically, real estate brokers charge commissions of between 4% and 7% of the sales price. On higher priced homes, the broker may charge a smaller commission. The terms of the broker’s agreement in the seller’s market are always negotiable and include the asking price, commission rate, date the agreement terminates, etc. Sellers should negotiate the shortest term possible and renew the agreement for an additional term if they are satisfied with the broker’s services.
Whether or not to hire a broker depends on all of these factors. When considering selling your home it is always advisable to consult with one or more brokers and discuss the local real estate market as well as the terms of any agreement they may propose. Regardless of whether you decide to actually hire the broker or sell the house yourself, you will find your local broker to be a valuable source of information.