When you’re buying or selling a home, it’s important to know how your real estate agent is getting paid. If you don’t, you may end up with a less-than-satisfactory experience or overpaying for your next home. Here’s the scoop on how agents get paid and where their commission fees come from.
In general, real estate agents make money based on the sales transaction they complete. Depending on the market, this fee can be 5% of the sale price or more. This amount is usually split between the listing and buyer’s agents, although there are some instances where the broker gets to keep the entire fee. Read more https://www.acashhomebuyer.com/sell-my-house-fast-farmers-branch-tx/
The agent’s income is also eroded by taxes and business expenses. Federal and state income taxes, self-employment taxes, licensing fees and multiple listing services (MLS) charges all take a bite out of the commission check. In addition, the average agent spends money on advertising, photography equipment, gas for showing homes, and a variety of other things to help their clients buy or sell a property.
Most people don’t think about how their real estate agent makes their money when they are looking for a new home or considering whether to list their current house. But understanding how agents are compensated can help you shop around and find an agent who will work best for your situation.
Buying a home or selling a home is often the biggest financial transaction a person will ever complete, so it’s not unreasonable to want to be sure you have an agent who is qualified to handle the deal. In addition, it’s a good idea to choose an agent who is reputable, has the right experience for your transaction and will do a thorough job.
Some agents are lucky enough to have a career in real estate that allows them to make six figures. However, even the top agents must work hard to earn this type of income. Unlike salary-based jobs, where most employees get the same amount each week, commission-based careers have large variations in pay. That’s why some people choose to enter a field like real estate for the flexibility it offers, while others find that they need to put in long hours to make ends meet. If you’re interested in becoming a real estate agent, learn how to get a real estate license in New York.
