real estate fees

Are Real Estate Fees Negotiable?

Yes, real estate fees are negotiable because virtually everything is negotiable in real estate, including the commission, closing costs, staging costs, and repairs. All together, sellers can expect to pay about 10 percent of the final selling price in fees.* But what you actually pay will depend on your home, the market you’re in, and negotiations with your agent.

Real estate agents are licensed salespeople for homes and property. They make a living by assisting buyers and sellers in a real estate transaction. By and large, real estate agents work for themselves, which means they are free to set whatever price they want on their services. Every real estate transaction is also different, which means the price may change depending on the services required. These two factors create a highly flexible environment in which everything is negotiable.


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When Do I Have Leverage to Negotiate Lower Fees?

Traditionally, real estate agents make 6 percent in commission.* However, many will accept lower than this if the conditions are right. The times when agents are more likely to accept a lower commission include:

When the home is very expensive

If the home is worth a lot, the commission will be high and there will be a lot of competition from other agents to represent the seller.  To ensure he or she does not lose the listing, the agent may be willing to accept a lower commission rate.

When the home can be expected to sell quickly

A quick selling home allows agents to collect a commission and then move onto new sales. If you are in a hot market, your agent may be willing to accept less knowing that the next sale is right around the corner.

When the agent is representing the client as a buyer and seller

It’s uncommon for homeowners to use the same agent to help them sell their old home and buy a new one. In this case, the agent is in line to collect two commissions, and may accept less for each.

When the homeowner does not need all services

If the homeowner is familiar with the real estate industry and is willing to take on more of the responsibilities, such as marketing and showing, he or she may be willing to negotiate a lower commission.

The availability of alternatives

The presence of flat fee services, Redfin, and other discount models also may be enough to push an agent to accept a lower fee. These companies offer lower fees than a typical agent and increase competition for listings.

Should I Try to Negotiate Lower Fees?

So now you know that real estate fees are negotiable. Should you try to negotiate them? The answer to this question is yes and no.

While negotiating down the commission can help you save money on real estate fees, it can cost you elsewhere. These potential costs include:

Buyer’s Interest

The commission your agent makes is split with the buyer’s agent. If the commission you set is too low, you may limit the number of buyer’s agents willing to pursue the listing.

Marketing Expertise

Many agents respond to requests for lower fees by reducing the services they provide. One of the first to go is usually marketing. If you are an experienced marketer this may not be a big deal for you. If not, you may lose out in the additional time it takes to sell your home or the reduce offers it receives.

Agent Quality

The best agents stand by their work and the fees they charge. Insisting on lower fees above all else may drive them away and leave you with a pool of lesser quality agents.

Is There a Happy Medium?

So you want to save money, while using the full range of services offered by your agent. What can you do?

One tactic is to ask your agent to make the fees performance-based. This can work a couple of ways. First, you can set a timeline, say 60 days from listing to close, and offer a full commission if the agent meets that timeline and a lower commission if he or she does not. Second, you can negotiate a tiered commission based on price, where you provide a base rate for the asking price, and more (or less) if the final selling price exceeds the asking price (or falls below it).

Any questions or feedback? Leave them in the comments below. Or for more, check out How much do you pay to sell a house? and How Much Does It Cost to Get Access to the MLS?

*Please note: By law, there is no fixed commission rate in real estate transactions and any attempt to do so would be against federal law.


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The opinions or information expressed in this article are those of the author and do not necessarily reflect the official views, policy, or position of Realtyna. The information on Realtyna’s Website is general, for informational purposes only, and is not to be relied upon or interpreted as real estate, legal, accounting, or other professional advice or a substitute. Please discuss anything related to the certification process, professional advice or legal procedures with your MLS providers.

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