Home Buyers & Sellers Why Commission?
Why does a REALTOR® charge commission?

Your REAL ESTATE agent is a self employed business professional. Their job is to represent you in the transaction of REAL ESTATE. Whether you are selling a home, or looking to purchase property.  As a licensed REALTOR®, a huge amount of responsibility goes along with the job, not only to serve you as a client, but to help protect you and your interests.

Being a REALTOR® is not a nine to five job. There is no wage or salary check from their employer at the end of each pay period and no hourly rate is determined by a labor board. Your REALTOR® is paid only upon successful close of escrow.

Being a REALTOR® is just like operating your own business. Your agent faces similar “overheads” found in any business venture with a good portion of their commission satisfying these business related expenses. Depending on the agent and the agency he/she represents, that commission is often split with their REAL ESTATE office to help cover the “cost of doing business”.

Other REALTOR® expenses come in many forms. Advertising your house, and their services via magazines and newspapers is extremely expensive. A single page in a “free” publication (i.e., found at the grocery store), can cost several hundred dollars alone each month.  Transportation, vehicle operating costs and rising gasoline prices are also a very expensive portion of a REALTOR’S® business. Office space/facilities and equipment are a monthly expense for your REALTOR®. “Cutting edge” technology costs money and computers, printers, hardware, software, web-pages, e-mail, cell phones with airtime and long distance, pagers, renewal hours and continued education classes are just some of the things which must be paid by your agent before a commission is ever paid.

When you retain a REAL ESTATE agent, please remember that they are working hard for you and the commission that they earn is typically well deserved.


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