The real estate market is a profitable venture, and the number of investors increases each day. However, this isn't to mean that you can buy and sell property on your own. Most investors lack adequate information about buying or selling homes, hence the need for a realtor. A good realtor will help you locate the best property deals and guide you in the entire process. However, there are various things to negotiate when hiring a realtor, and all of them usually revolve around the commissions.
How much is the realtor fee?
The realtor fee is negotiable when seeking to buy or sell a property. But, this doesn't mean that you offer a lower rate than the cost in your area. Usually, the real estate agent fees in Melbourne ranges between 1.6-2.5% of the overall property cost. If both your buyer and seller have personal real estate agents, realtors will split the commission and pay the broker from their commission. Meaning, a substantial amount goes to the broker, and the agent doesn't get that hefty amount as many people assume.
What are the negotiation tactics to employ when hiring a realtor?
1. Look for a local real estate agent
A local real estate agent has a better understanding of the market and will offer suggestions to help you benefit from the sale. Secondly, they know the most desirable places where you can get a home at a lower price. With a local agent, it'll be easier to get information on agent fees in the area. You can use this to make informed decisions concerning the agent's fee.
2. Study the market
Knowing the prevailing market trends helps in determining the property price. It also helps in negotiating the agent's commission. For instance, if your home is located in prime, and can easily sell, negotiate for a lower commission. Besides, the agent won't have a lot of work marketing the property.
3. Use your listing agent
If you are buying and selling a home simultaneously, use one agent for both transactions. The realtor will be willing to take lower commissions for the two deals. If this is included in the listing agreement, don't involve another realtor later on; it will breach the contract.
4. Hire new agents
A new agent works well. You're likely to get a better deal with a realtor who's new in the business. Besides, most new realtors seek to build a good working relationship, get better reviews, and gain experience; hence they take lower rates. But, ensure that they have all the necessary skills and traits before hiring.
5. Consider multiple listings
If planning to sell different properties, list them at the same time. Doing this saves time and may invite good deals when it comes to the agent's commission. What's more? Multiple properties entice agents, who can gain much from the sale. Many will be willing to lower the commission rate, which saves you money.
6. Allow a lockbox.
If living in the home, a lockbox can be a great bargaining chip. It will only be accessible by licensed realtors, giving you sufficient time before showings. Also, it will save the listing agent time and money as well. Besides, most agents pay their assistants to host showings, and a lockbox saves money on this.
7. Sell during off-peak
A real estate agent may accept a lower rate when not very busy and in need of business. This mostly happens during low seasons when fewer people are selling or buying property. Take advantage of this to negotiate lower commission rates.
Real estate agents are great negotiators and use the same skills to fetch the best property value. Know the best commission rate that matches your property, and this will give you an upper hand during the fee negotiation. In some cases, agents may not be willing to negotiate. And this happens when your property is hard to sell or when the commission is too low.