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The Truth About Real Estate Commissions – Are You Overpaying?

December 23 2017
by Jake Cardenas

A traditional real estate agent charges 6% – 3% to list your home, and 3% for the buyer’s agent.

That’s almost $20,000 in commission for a $300,000 home, and $40,000 for a $600,000 home.

Is your real estate agent doing enough work to merit such a large commission check?

Does an agent that sells a $600,000 home work twice as hard as they do for a $300,000 home as their commission would suggest?

Some agents charge a fraction of the traditional 6% to sell your home.

Are they doing the same amount of work as a traditional listing, and will your house sell for the same price with a discounted listing compared to traditional?

How Much Work Does It Take To Sell A House?

Before we can establish if you’re paying too much in real estate commissions, we need to know exactly how much work it actually takes for a real estate agent to sell a house. When a real estate agent sells a home they have the following responsibilities:

  • Listing appointment
  • Pricing the home correctly
  • Taking photos
  • Listing the home on the MLS, Realtor, Trulia, Zillow, and other sites
  • Scheduling showings
  • Reviewing offers
  • Advising on negotiations
  • Marketing

Pricing a home correctly is much easier than it used to be, as agents have access to every sold listing online in an easy-to-use spreadsheet.

Listing a home online takes less than an hour, and it instantly shows up on the MLS, Zillow, Trulia, Realtor.com, and thousands of other local listings websites that potential buyers are already using.

Coordinating showings is done online, and in most markets, through an easy-to-use app.

Finally, let’s talk about what an agent really means when they say they will market your home. Currently, 93% of homes are sold from the MLS and associated sites that pull data from the MLS like Zillow and Trulia.

Home buyers are finding homes online, not in one of the flyers that agents print out and put in a box outside of your house.

Generally, what real estate agents will justify as marketing for your home is actually geared toward them finding more clients to work with. It’s common for agents to send out direct mail featuring properties they just sold.

While that makes them look like a great agent, it won’t help you sell your house any faster.

Does It Take More Work To Sell A More Expensive House?

There are some exceptions, but the short answer is no. Selling a $600,000 home is the exact same process as selling a $300,000 home.

Some homeowners at higher price ranges want professional videos, staging, and drone photography, but all of those are almost never done by an agent and are contracted out to professionals.

Once the home is on the market, the process is identical regardless of price. If the home is priced correctly it will sell.

How Does Discount Real Estate Work?

Traditionally, discount real estate agents offer their services for a flat fee, regardless of the price of their home. These agents have figured out how long it takes them to sell a home, and have their price based on time, instead of commission.

A good discount agent offers the exact same services as a traditional agent, for a fraction of the cost.

The one downside of a traditional discount brokerage is that prospective buyers know that that you’re listing with a discount brokerage, and will take your savings on commission into account when they make an offer.

How Clever Is Different

Clever doesn’t partner with discount brokerages. Clever works with traditional agents, who would normally list your home for 6%.

Clever partner agents list your home under their local brokerage (or national brand), and provide the exact same service that they already provide to their clients that list for 6%.

Sell or Buy a Home with Clever and Save Thousands!

Enter your zip code to see if Clever has a partner agent in your area!

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Why Do Agents Work With Clever?

Real estate agents spend a lot of time and money looking for new clients, and Clever solves that problem for them.

We provide agents a constant stream of quality clients that are ready to list their home. Agents are willing to work for a discount commission with Clever because we send them a high volume of clients, and they make a normal commission when they help our clients buy a home.

Our partner agents know that we will only continue send them referrals if they provide quality service to our clients.

Ready To List Your Home?

If you’re ready to list your home, Clever can connect you with a top-rated local agent in your market who will list your home for a flat fee of $3,000 for homes under $350,000, or 1% if the home is worth more. Clever partner agents provide the exact same services as agents that charge 6%. Homeowners who list with Clever save an average of $8,000 when they sell their home.

For more information, or to list your home, go to https://listwithclever.com/.