How San Diego Real Estate Agent Commission Works

When you want to sell your home in San Diego, working with an experienced real estate agent is more than just convenient, it’s a smart financial move. Sellers who hire seasoned agents can earn an average of $40,000 more on a home sale than those who do it alone. But where does this commission come from and how much will it cost you? Let’s take a look at those questions upfront.

Who Exactly Pays Real Estate Agents?

Commission fees, for the most part, are paid through the sale proceeds and are split up between the buyer’s and seller’s respective brokerages. Here’s a simple breakdown:

  • Seller’s Responsibility: Typically the seller pays the commission total, which is divided between the listing (seller’s) agent and buyer’s agent.
  • Brokerage Payout: If partnered with an established brokerage like Coldwell Banker, your Realtor’s commission is paid first to the brokerage and they subsequently compensate your agent based on a predetermined split.
  • Buyer’s Contribution: Usually the buyer doesn’t pay their Realtor directly with commission costs figured into the overall home price.

The structure outlined above basically helps to ensure both agents–buyer and seller–will strive to close fairly and efficiently in San Diego’s highly competitive market.

How Much is the Commission in San Diego?

The amount of the commission is often negotiable, but it traditionally ranges from 5% to 6%, although can sometimes climb up to 8% if selling a mega-mansion. Common practice is that the broker for the seller will share the commission with the broker for the buyer, though this may not be split evenly. 

It is up to the brokers to decide how the commission will be split and if a highly successful agent will receive a larger portion of the proceeds than maybe an agent just getting established. Also, some agents may offer much more negotiable rates/flexible commissions if the property in question is particularly high-end or if the market is hot at the time.

The Real Estate Commission Agreement

Prior to your property’s listing, you will sign an agreement with your Realtor outlining the rate of commission, terms of service, and the nuts and bolts of payment conditions. Here are four things to know:

  1. Commission Rate Disclosure: The commission percentage fee to be charged upon a successful sale is clearly stated in black and white.
  2. Agreement Duration: These contracts typically go from 90 to 180 days but can also be tweaked to fit whatever your needs or provisions might be.
  3. Cancellation Terms: You may also be allowed to cancel the agreement under certain conditions if not fully satisfied with your Realtor’s performance/services.
  4. Multiple Agents: If during mid-sale you opt to change agents or work with multiple brokerages, the whole commission structure can turn more complicated, necessitating double (and double the headache) commission payments in some cases.

If you’d rather avoid unnecessary contract surprises later on, be sure to thoroughly go over and review these details with your Realtor before signing on the dotted line before it’s legally binding.

Why Paying Commission is Worth It

If you are considering whether or not it is worthwhile to pay a portion of your proceeds to a real estate agent, consider that not only will having an agent help you sell your home more effectively and save you time, but those who hire a Realtor end up selling their homes for an average of $40,000 more than those who go FSBO (For Sale By Owner).

Hiring a real estate agent means you’ll have someone who knows how to utilize MLS listings, social media, staging and open houses to attract the right buyers and then negotiate the best price while juggling multiple offers. There’s a million ways to screw up the sale of a home, and your Realtor can help prevent most of them.

This Isn’t Monopoly Money–Hire a San Diego Realtor Today

The final decision on whether or not to hire a Realtor is up to you, but the benefits are clear–you’re getting local market expertise, and can get better offers, quicker sales, and above all else–peace of mind. If you’re ready to realize your home’s full potential value, connect with Realtor Linda Moore today to help you achieve the best sale possible!

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