Commission Split 50/50?

By
Real Estate Agent with Cactus Mountain Properties, LLC
I am thinking out loud!  How is it that the SELLER in a real estate transaction carries the burden of the cost of both sides of the real estate commission?  Why isn't it split equally between buyer and seller's agents and distributed at the close of escrow?  Wouldn't that help level the financial disparity for both parties allowing for a more active market?  Both the buyer and seller enlist a real estate practitioner to negotiate in their behalf and exercise their expertise in securing all legal details of a transaction, then why does the SELLER pay all the commission?
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Barb Merrill Works 4 U!

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Rainmaker
44,094
Sherri Elliott
Keller Williams INTEGRITY TEAM
Good Question..This is how it has always been. However I do know Buyers agents who get paid even if they do not sell the client a home. Agents will do the buyer rep. and ift their client buy's a FSBO, BUILDER or any other home they still pay the agent their agreed amount for commission. Some even get paid this on top of the commission for selling a MLS listing! No I do not agree with that, but know it happens!
October 21, 2007 08:38 PM
Rainer
78,048
Vicky Poe
Realtor/ Auctioneer
Good Ole Rocky Top
I have thought that the buyer should shoulder some expense.  At most auctions the buyer pays  a buyers premium.
October 21, 2007 08:38 PM
Rainer
32,275
Brandon Causey
Realtor, Coastal Palmetto Realty LLC
Coastal Palmetto Realty LLC
If I'm doing a land acquisition (I love these) I charge a up front retainer fee plus I get a commission from the buyer...Sometimes I am able to negociate a commission from the seller as well.  Remember this is not an easy process.  I almost always have to deal with zoning and the local governments in order for my buyer to use the property for it's intended purpose. 
October 21, 2007 08:38 PM
Ambassador
1,327,121
Jon Zolsky, Daytona Beach, FL
Selling Daytona paradise for heavenly good prices
Daytona Condo Realty, 386-405-4408

Really, such a logical question, and by a matter of habit we do not even think about it. I am curious if there is a reason for that. You asked a terrific question.

Thanks for the idea

October 21, 2007 08:39 PM
Rainmaker
1,072,243
Gary White~Grand Rapids Home Selling Pro Call: 616-821-9375
Real Estate Services You can Trust!
Flexit Realty "Flexible Home Selling Solutions"

Well Barbara....the old standard..."it's always been done that way"!  The primary reason is the seller is the party that engages the selling representation.  The buyer's agent is paid a portion of the selling brokers fee to bring buyers.  It was and is an incentive to do so. 

Why would a buyer share in the marketing and sales costs of a property they do not own?  It might be more equitable but has no incentive for the buyer to participate.  Nice thought probably not going to happen.  Currently sellers even contribute to closing costs and other expenses incurred by the buyer as additional incentives.  Great post Barbara...very thought provoking.

October 22, 2007 08:40 PM
Ambassador
2,365,169
Patricia Kennedy
For Your Home in the Capital
Evers & Company Real Estate, Inc.
Barbara, the buyer does pay the commission as it is included in the price the buyer pays.  By doing it this way, it can be bundled in with the mortgage.
November 29, 2007 10:03 PM
Rainmaker
59,023
Cathleen OnullHannigan
Cary NC Homes Pro
Keller Williams Realty

The seller shouldn't have to pay all of it, but the buyer has lender fees and if you add commission, it's just to much for most buyers, especially now with such tight lending requirements. Also, if buyers have to pay 3%, I think they will just use the internet and contact sellers directly, totally bypassing the agent.

August 24, 2008 07:49 AM
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Rainmaker
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Barb Merrill

GRI, Associate Broker
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