A Buyer’s Agent Costs Nothing

Typically, for properties listed with a local MLS the buyer’s agent fee is paid BY THE SELLER!!!

Generally, when a property owner agrees to sell property through the MLS system, he/she retains a seller’s agent to sell that property at a specific commission rate (in our area 4% – 5% is common).  Through the MLS listing, the seller authorizes the seller’s agent to offer a “cooperating broker commission” to buyer’s agents who serve as the procuring cause of a ready, willing and able buyer.  Generally the seller’s agent and the buyer’s agent split the available commission. By way of example, for a 5% commission deal, both the seller’s agent and the buyer’s agent would receive a commission of 2.5% of the sale price.

Sometimes buyers ask whether the use of a buyer’s agent means the seller’s “bottom line” sales price will be higher because they have to account for the buyer’s agent’s commission.  Because (in most cases) the seller is paying the same total commission (4% – 5%) whether or not there is a buyer’s agent involved, there is no reason a seller would agree to a lower sales price if a buyer proceeded without a buyer’s agent.  Instead, the reason sellers authorize and instruct their agent to offer cooperating broker commission to buyers’ agents is to maximize the incentive, exposure and motivation for the most number of agents to bring prospective buyers to see their property.