Know How Discount Brokers Operate
Are you looking for the best discount real estate brokers in NJ? On an rough estimate, the traditional brokerage fees are as high as 7% of the sales price. The average co-brokering fee, the fee paid to selling agents who cooperate, is often as low as 3.15%. Therefore, listing agents make a lot more money than selling agents. An agent spends about 4.5% on advertising fees, giving 2.5% to the selling agents and keeping 2% for her company. Here are some of the examples that can help you understand how these discounts operate:
Flat-fee Listing Policies
This brokerage accepts listings at a flat rate, paying a cooperating percentage fee on top of that amount to selling brokers. This cooperating fee is also paid by the seller. We can often see a brokerage ad offering to list your house at a fee of $2,000 with small disclaimer that this fee is exclusive of the fee paid to the selling broker.
Small Percentage-Fee Listing Policies
Some brokers tend to advertise to take a listing for 1% or 2%. Again, many of these brokers fail to make clear that the selling broker has to pay an additional fee by the seller.
Buyer Commission Rebates
Many real estate agents advertise that if you hire one of them to buy a home, the company will credit the buyer a percentage of its commission or a flat-fee at closing. This money is what the seller pays to the broker who presents the buyer.
There are several other ways but these three are most common way how broker discount works. This could vary from one place to another and from broker to broker.